Integration
Integration is a strategy where a firm seeks to control more of its value chain (Porter, 1985). Integration can be a powerful strategy to achieve competitive advantage because it places more control in the hands of the firm. The risks of pursuing an integration strategy are many, including needing to be able to effectively manage all aspects of the production process from raw materials to retailing. Many firms practice a partial integration strategy and seek to control certain key aspects of their value chain. Part of the internal and external analysis should include evaluating which parts of the value chain are providing the most profitability. Once these units are identified they will need to be acquired and integrated into the corporate processes and culture.
Example of integration strategy.
Example of integration strategy.