Focus Ltd has always had a strategy of product differentiation; that is, providing high-quality products and extracting a price premium from the market. During the recent economic downturn, Focus Ltd has seen its customer base diminish and has decided to move strategically to a cost leadership strategy; that is, to sell more product at a lower price.

(a) What are the implications of this strategy change for the production cycle? (LO1)

(b) What changes would you expect to see in the production cycle? (LO4)

(c) What are the implications of this strategy change in terms of the usefulness of historical sales data for production decision making? (LO3)