Competitive Advantage: Difference between revisions
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Sustainable Competitive Advantage is a set of assets, positions and environmental conditions that enable a company to consistently outperform its competitors in its chosen industry. It is NOT a strategy it the outcome of strategy | Sustainable Competitive Advantage is a set of assets, positions and environmental conditions that enable a company to consistently outperform its competitors in its chosen industry. It is NOT a strategy it the outcome of strategy. | ||
Attributes - Cost Advantage - Unlikely MES > 75% and unlikely to be sustainable in the | Attributes - Cost Advantage - Unlikely MES > 75% and unlikely to be sustainable in the long-run. More likely a hygiene factor, unless you are the only one who lives on top of gold mine - Monopolies, Oligopolies | ||
Differentiation - Allows a firm to command a premium price | Differentiation - Allows a firm to command a premium price because a combination of product offerings is difficult to copy. | ||
Sources of CA - Structural - Installed Base - Microsoft | *Sources of CA - Structural - Installed Base - Microsoft | ||
Execution - Organizational Learning, Culture of | *Execution - Organizational Learning, Culture of Customer Service | ||
Insight - Tech innovation (copyable) Pricing, Arbitrage | *Insight - Tech innovation (copyable) Pricing, Arbitrage | ||
CA is about creating imperfections - Tech Innovation, Controlling Info, Barriers to entry/exit, High switching costs, Size (MES), Product Differentiation = PRICE MAKERS | CA is about creating imperfections - Tech Innovation, Controlling Info, Barriers to entry/exit, High switching costs, Size (MES), Product Differentiation = PRICE MAKERS | ||
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The sustainability of CA is based on | The sustainability of CA is based on | ||
Power | *Power | ||
Catching up - nullifying CA | *Catching up - nullifying CA | ||
Keeping ahead | *Keeping ahead | ||
Re- | *Re-enforcement - mutually re-enforcing existing advantages | ||
Is there more than one generic Strategy possible | Is there more than one generic Strategy possible | ||
YES Org innovation, technology allows high quality/low cost. | *YES Org innovation, technology allows high quality/low cost. | ||
NO Stuck in the middle, most | *NO Stuck in the middle, most organizations are not flexible, different strategies need different and conflicting strategies | ||
The three major routes to CA | The three major routes to CA | ||
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Pharma - few and large - patented drugs | Pharma - few and large - patented drugs | ||
See also [[Differential Advantage]],[[Porter's Generic Strategy]] | See also | ||
*[[Differential Advantage]], | |||
*[[Porter's Generic Strategy]] | |||
*[[Competitive Advantage History]] | |||
[[Category:Strategy]] | [[Category:Strategy]] | ||
Revision as of 07:43, 13 October 2012
Sustainable Competitive Advantage is a set of assets, positions and environmental conditions that enable a company to consistently outperform its competitors in its chosen industry. It is NOT a strategy it the outcome of strategy.
Attributes - Cost Advantage - Unlikely MES > 75% and unlikely to be sustainable in the long-run. More likely a hygiene factor, unless you are the only one who lives on top of gold mine - Monopolies, Oligopolies Differentiation - Allows a firm to command a premium price because a combination of product offerings is difficult to copy.
- Sources of CA - Structural - Installed Base - Microsoft
- Execution - Organizational Learning, Culture of Customer Service
- Insight - Tech innovation (copyable) Pricing, Arbitrage
CA is about creating imperfections - Tech Innovation, Controlling Info, Barriers to entry/exit, High switching costs, Size (MES), Product Differentiation = PRICE MAKERS
It has to be perceived by the Customer
The sustainability of CA is based on
- Power
- Catching up - nullifying CA
- Keeping ahead
- Re-enforcement - mutually re-enforcing existing advantages
Is there more than one generic Strategy possible
- YES Org innovation, technology allows high quality/low cost.
- NO Stuck in the middle, most organizations are not flexible, different strategies need different and conflicting strategies
The three major routes to CA
- Specialize on a customer group - Focus
- Differentiation
- Lowest Cost Producer
Pharma - few and large - patented drugs
See also
