A competitive advantage could simply be defined as the advantage or ability a firm has over its rivals in the industry; or the ability a firm has to outperform its industry rivals.A firm is said to have a competitive advantage when it has the capabilities or means to push out its rivals in striving for the favour of customers. This applies internationally or locally as well as to both services and products.Thus, a sustainable competitive advantage is the persistence the firm applies despite efforts by competitors or potential entrants to copy or overtake it. Sustainability therefore, requires that strategic assets are not easily available to others and imperfectly mobile. This will be considered later.Porter (1990) states that, though not all nations are in the forefront of competition, the home nation which shapes the competitive advantage is the starting point for a firm's competitive advantage and also from which it must be sustained. However, in whatever field of endeavor, … [Read more...] about Sustaining Competitive Advantage
Sustained competitive advantage
The most common routes to sustainable competitive advantage involve one or more of the following basic strategies: differentiation, low cost, niche, preemptive move, and synergy.Differentiation - your product is distinguished from that of your competitors by giving customers more value and greater perceived benefits than they could obtain elsewhere. You have to clearly state what your product has, or can do, as compared to your competitor's product - why your product is different and therefore better! Low Cost Strategy - should not be confused with the idea of being inexpensive, or dare I say it, "cheap". It's about value. In today's tough economic times, customers demand more value for their money, causing marketers to examine creative ways to deliver additional value to their customers. While value doesn't necessarily mean that the customer will pay less for your product, it does generally imply that they will receive more for their money. Niche - a … [Read more...] about How to Achieve a Sustainable Competitive Advantage
"The only unique asset that business has for gaining a sustained competitive advantage over rivals is its workforce-the skills and dedication of its employees. There is no other sustainable competitive advantage in the modern, high-tech, global economy," said Robert B. Reich, former Secretary of Labor under President Bill Clinton and now professor of public policy at the Goldman School of Public Policy at the University of California at Berkeley.Managing Labor in Tough TimesThe workforce is changing, and depending on what sector your business is in or what part of the country it is located in, you may be feeling the pinch of the growing labor shortage. Recent research from the Boston College Center on Aging and Work indicates what some companies are doing and that is: intensifying recruitment and reorganizing work flow so that they stay productive with fewer people. In these tougher labor times, organizations will also need to address poor work habits of their current employees to … [Read more...] about Leadership Matters Work Habits That Sustain Competitive Advantage
A Sustainable Competitive Advantage (SCA) is a unique offering that is valued by your customer and is not available from the competition. It is not what you think it is or what you want it to be. It is what your customer believes and that is what counts. This perception is everything.Your SCA is made up distinctive competencies, which are unique attributes or benefits that are valued by the customer. Simply stated, this means that you do different things, or that you do things differently from your competition. These distinctive competencies are so valuable to your customer that they will choose your offering instead of the competition's offering. These benefits could be unique product features, product design, method of delivery, or even your brand.An example of doing things differently is Starbucks. They serve coffee, which is hardly unique, but they make the coffee buying experience almost a lifestyle. Have you seen the lines at this place? And, people go to Starbucks just to hang … [Read more...] about Niche Marketing With a Sustainable Competitive Advantage
All of us in business are constantly thinking of ways to stay ahead of our competitors, but what actually is competitive advantage? Many strategy specialists discuss competitive advantage and the need for it in business, yet very few of them actually define the term. The difficulties in finding a suitable definition may simply be the result of competitive advantage meaning what it is; i.e. an advantage in terms of competitiveness, where no exact definition is given because it is company or product specific.The notion that competitive advantage is company specific is supported by Hay and Williamson (1991, p42), where they define the term as a, "deceptively simple idea of assessing a company's capabilities and market position by how they give it advantage relative to competitors". They bring forward the opinion that competitive advantage can only be found by making a comparison between a company and its competitors. This is further supported by Barney (1991, p99) who also brings in the … [Read more...] about What Is Competitive Advantage?