1.5 Competition And Five Forces Analysis
1.5 Competition and five forces:
In order to achieve average return, Customer satisfaction is a core competency that every organization should focus. Business level strategies are used to carry out this core competency. Actions which are taken to add values to customers and gain competitive advantage in a specific market with the single product or service, are included in the business level strategy. The main concern of a business level strategy are position of a firm in the industry, firm’s competitors and Porter’s five forces. The customers of an organization are considered as the foundation or essence of business level strategies, followed in any organization. The senior management determine the following:
• Who are all the customers?
• What …show more content…
In order to form core competencies, an organizations must know to combine the resources and capabilities. Value crating strategies are implemented to satisfy the needs of the customers, by using these core competencies.
1.5.1 Business Level Strategy
An organization can establish competitive advantage with the help of four generic strategies. A firm is free to choose whether it can compete in a broad market or focused market. Integrated strategy is the fifth level business strategy.
1. Cost Leadership :
Based on price, an organization can compete for a wide customer. Internal efficiency is used to determine the price. Based on internal efficiency price is determined. Because the determined price should bring a return above the average level and also the cost expected by the customer for that particular product or service offered by the organization. When the product is standardized so that the customer will get the best service or product at low cost. In order to be a successful cost leader continuous efforts are taken to lower costs with respect to the competitor’s product. Following are included:
• Building an art efficient facilities. (To imitate it can be made costly for …show more content…
Using an Integrated Low-Cost/Differentiation Strategy:
The popularity of the new strategy increased due to an increase in the global competitor. An improvement in the ability of the firms is seen, when a firm utilize this strategy.Following are the ability of the firm which uses the strategy:
• Adapting environmental changes.
• Learn new skills and technologies.
• Across the business units, core competencies across and products lines are leveraged more effectively, which enables a firm to produce goods at low cost with differentiated features.
Thus based on features of a product and a low cost, the customer realizes value. For an example Southwest airlines is a company that uses Integrated Low-Cost/Differentiation Strategy.
However, organizations which choose this strategy must be aware of the following: not to stuck in the middle i.e., unable to manage the five competitive forces successfully and not achieve strategic competitiveness. Differentiated features can be added to the products during reducing
In order to achieve average return, Customer satisfaction is a core competency that every organization should focus. Business level strategies are used to carry out this core competency. Actions which are taken to add values to customers and gain competitive advantage in a specific market with the single product or service, are included in the business level strategy. The main concern of a business level strategy are position of a firm in the industry, firm’s competitors and Porter’s five forces. The customers of an organization are considered as the foundation or essence of business level strategies, followed in any organization. The senior management determine the following:
• Who are all the customers?
• What …show more content…
In order to form core competencies, an organizations must know to combine the resources and capabilities. Value crating strategies are implemented to satisfy the needs of the customers, by using these core competencies.
1.5.1 Business Level Strategy
An organization can establish competitive advantage with the help of four generic strategies. A firm is free to choose whether it can compete in a broad market or focused market. Integrated strategy is the fifth level business strategy.
1. Cost Leadership :
Based on price, an organization can compete for a wide customer. Internal efficiency is used to determine the price. Based on internal efficiency price is determined. Because the determined price should bring a return above the average level and also the cost expected by the customer for that particular product or service offered by the organization. When the product is standardized so that the customer will get the best service or product at low cost. In order to be a successful cost leader continuous efforts are taken to lower costs with respect to the competitor’s product. Following are included:
• Building an art efficient facilities. (To imitate it can be made costly for …show more content…
Using an Integrated Low-Cost/Differentiation Strategy:
The popularity of the new strategy increased due to an increase in the global competitor. An improvement in the ability of the firms is seen, when a firm utilize this strategy.Following are the ability of the firm which uses the strategy:
• Adapting environmental changes.
• Learn new skills and technologies.
• Across the business units, core competencies across and products lines are leveraged more effectively, which enables a firm to produce goods at low cost with differentiated features.
Thus based on features of a product and a low cost, the customer realizes value. For an example Southwest airlines is a company that uses Integrated Low-Cost/Differentiation Strategy.
However, organizations which choose this strategy must be aware of the following: not to stuck in the middle i.e., unable to manage the five competitive forces successfully and not achieve strategic competitiveness. Differentiated features can be added to the products during reducing