Maintaining competitive advantage in today's ever-changing business environment is not a simple task. For any company to maintain a competitive advantage, the company must develop the advantage such that it is "rare, costly to imitate, no substitutable, and nontransferable" (Snyman, J.H., 2006). Along these lines, Michael Porter has provided five competitive forces that can assist any company in maintaining the advantage. These forces are "the entry of new competitors, the threat of substitutes, the bargaining power of buyers, the bargaining power of suppliers, and the rivalry among existing competitors' " (Pfeffer, J., 2005). Three methods for maintaining competitive advantage that will address these forces are effective strategic management, the effective management of people, and the effective management of research and development.
Dr. Johannes Snyman conducted a study of the trucking industry within the United States. Dr. Snyman concluded "in order to compete successfully in today's deregulated environment, trucking companies must continually evaluate and adjust their strategies. They must therefore not only pay attention to the content of strategy, they should also focus on the processes by which strategy is crafted" (2006). This could be said for any company in any industry.
Effectively managing people means "achieving success by working with people, not by replacing them or limiting the scope of their activities" (Pfeffer, J. 2005). Some firms that have gained and maintained a competitive advantage through the use of their people management are Circuit City, Tyson Foods, Wal-Mart, and Southwest Airlines (Pfeffer, J., 2005). In alignment with experts' suggestions on maintaining competitive advantage, effectively managing people is not easily imitated, can be rare, and is thus a great choice of how to keep the advantage.
Smith's Group used R&D to achieve and maintain competitive advantage. By having a...