A Business Encyclopedia

Stability Strategy

Definition: The Stability Strategy is adopted when the organization attempts to maintain its current position and focuses only on the incremental improvement by merely changing one or more of its business operations in the perspective of customer groups, customer functions and technology alternatives, either individually or collectively.

Generally, the stability strategy is adopted by the firms that are risk averse, usually the small scale businesses or if the market conditions are not favorable, and the firm is satisfied with its performance, then it will not make any significant changes in its business operations. Also, the firms, which are slow and reluctant to change finds the stability strategy safe and do not look for any other options.

Stability Strategies could be of three types:

Stability Strategy

  1. No-Change Strategy
  2. Profit Strategy
  3. Pause/Proceed with Caution Strategy

To have a better understanding of Stability Strategy go through the following examples in the context of customer groups, customer functions and technology alternatives.

  1. The publication house offers special services to the educational institutions apart from its consumer sale through the market intermediaries, with the intention to facilitate a bulk buying.
  2. The electronics company provides better after-sales services to its customers to make the customer happy and improve its product image.
  3. The biscuit manufacturing company improves its existing technology to have the efficient productivity.

In all the above examples, the companies are not making any significant changes in their operations, they are serving the same customers with the same products using the same technology.

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