5.0 Michael Porter's Generic StrategiesPorter's generic strategy identifies three types of generic strategies that can be pursued by almost any company that include cost leadership, differentiation and concentration and helps to achieve, defend and sustain the company's competitive advantages. (Huizen, 2006)Diagram 6: Micheal Porter's Generic StrategiesThe objective of the differentiation strategy involved offering a unique product or service that would allow the company to charge a premium price. Successful differentiation allows the company to charge a premium price for the product or service and gain brand loyalty. (Huizen, 2006) (Vipin Gupta, 2007)5.1 DifferentiationDiageo uses differentiation strategy, implementing a focused differentiation strategy. The relatively high operating profit indicates the premium collected on the products. The company has gained competitive advantages by using unique resources to create a greater perception of product benefits over competitors, so it can charge premium prices. The benefit of differentiation has been achieved by obtaining a price premium in the market that exceeds the cost of providing the differentiation. Consumers are generally loyal and willing to pay high prices for Diageo products. Diageo currently launches products focused on the customer's desire for luxury, taste, quality and brands such as Johnnie Walker, Crown Royal, Windsor, Captain Morgan etc.5.2 FocusDiageo Plc has announced that CEO Paul Walsh will step down after his 13 years as CEO of Diageo in 2013. Over the past 13 years, Paul Walsh has shaped Diageo to become the world's No. 1 spirits maker. Paul Walsh focuses on drinks but......at the heart of the paper......markets are big markets around the world; this is because the price of beer is much lower than other drinks such as whisky, vodka etc. Finally, there are some strengths and opportunities for the company. Diageo has a significant brand of its own. According to the report, in the coming years the trend of drinking will increase and precisely the opportunities of the Diageo company are leading in the wine and spirits market. Diageo another opportunity is the famous travel retail. The trend shows that travel retail is favorable and there are many sales of Johnnie Walker's collection. While CEO changes may affect the company's culture, however, new CEO Ivan Menezes said he will not change the strategy used by Paul Walk for the past 13 years and may not have the much greater effect of strategic risk.