...introduction: Strategy –definition, scope and importance: A strategy is a plan of action designed to achieve a vision. It can also be said that, strategy is a pattern in action over time of getting from here (present position) to there9 desired future position) Everybody is concerned with some strategy as it involves a plan “how and means of getting from here to there”. Strategy the word derives from the Greek word for generalship in army. It is the art and science of planning and marshalling resources for their most efficient and effective use. So, strategy is a method or plan to bring about a desired future prospect to adapt successfully. Three main areas of strategy: Every organization proceeds with some strategies. Corporate strategy is the linking process between the management of the organization’s internal resources and its external relationship with its customers, suppliers, competitors and so on. Every organization manages its resources in three main areas: 1) Resources strategy 2) Environment strategy 3) Adding value Resource strategy includes it resources such as – human skills, investment capital and others. Organization has to develop strategies to exploit those resources in a good pattern. Sometimes innovative ability can be a resource that is necessary to develop continuously. For example – Apple has huge investment in R&D sector. They have exploited their investment in that sector that requires comprehensive strategy to follow. So,...
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...THE CONCEPT OF COMPETITIVE ADVANTAGE IS CENTRAL TO THE STUDY OF STRATEGIC MANAGEMENT, AND EXAMINE THE USE OF PORTER’S GENERIC STRATEGEIS BY COMPANIES TO COMPETE. KEY TERMS Competitive advantage. This is the favourable position an organization seeks in order to be more profitable than its competitors. Strategic management. It is the systematic analysis of the factors associated with customers and competitors (the external environment) and the organization itself (the internal environment) to provide the basis for maintaining optimum management practices. The objective of strategic management is to achieve better alignment of corporate policies and strategic priorities. Porter’s generic strategies. These are three general types of strategies developed by Michael Porter that are commonly used by businesses to achieve and maintain competitive advantage. Company. It is a voluntary association formed and organized to carry on a business. Types of companies include sole proprietorship, partnership, limited liability, corporation, and public limited company. INTRODUCTION The concept of competitive advantage is central to the study of strategic management, since a company or an organization must follow an aligned strategy to outperform their rivals in the industry. Michael Porter introduces three generic strategies that a firm may apply in order to do so they include; overall cost leadership, Differentiation and Focus. In order to create and sustain competitive advantage, companies...
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...information system plays in organizations pursuit of competitive advantage: 3 Competitive Strategies 3 Cost leadership 3 Differentiation 3 Innovation Strategy 3 Growth (including mergers and acquisitions) 3 Strategic Alliance 3 Business Eco-systems and Co-opetition (Competition & Cooperation) 3 The Competitive Forces Model 3 Information systems can improve overall performance of business units by promoting synergies and core competencies 3 Core competencies 3 Network-based strategies 3 Sustaining competitive advantage 3 Performing strategic systems analysis 3 Managing strategic transitions 3 Product differentiation 3 Focus on market niche 3 Strengthen customer and supplier intimacies 3 Conclusion 3 Recommendations 3 References 3 Abstract: Daily life today requires the use of information technology systems. Endeavour such as education, manufacturing, research etc, treat information systems as a need. Information system (IS) combines hardware, software, infrastructure and trained personnel to facilitate planning, control, coordination, and decision making in an organization. Gaining competitive advantage is critical for company survival and success. Therefore, development and implementation of strategies to effectively counter the competitive forces is required. The solution is the application of Management Information System (MIS) as a critical enabler of competitive strategies like cost leadership, differentiation, innovation,...
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...information system plays in organizations pursuit of competitive advantage: 3 Competitive Strategies 3 Cost leadership 3 Differentiation 3 Innovation Strategy 3 Growth (including mergers and acquisitions) 3 Strategic Alliance 3 Business Eco-systems and Co-opetition (Competition & Cooperation) 3 The Competitive Forces Model 3 Information systems can improve overall performance of business units by promoting synergies and core competencies 3 Core competencies 3 Network-based strategies 3 Sustaining competitive advantage 3 Performing strategic systems analysis 3 Managing strategic transitions 3 Product differentiation 3 Focus on market niche 3 Strengthen customer and supplier intimacies 3 Conclusion 3 Recommendations 3 References 3 Abstract: Daily life today requires the use of information technology systems. Endeavour such as education, manufacturing, research etc, treat information systems as a need. Information system (IS) combines hardware, software, infrastructure and trained personnel to facilitate planning, control, coordination, and decision making in an organization. Gaining competitive advantage is critical for company survival and success. Therefore, development and implementation of strategies to effectively counter the competitive forces is required. The solution is the application of Management Information System (MIS) as a critical enabler of competitive strategies like cost leadership, differentiation, innovation,...
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...IDENTIFYING COMPETITIVE ADVANTAGES Video: Panera Bread Cohesion Case: Competitive Advantage:Business Dilemma To survive and thrive, an organization must create a competitive advantage. A competitive advantage is a product or service that an organization's customers place a greater value on than similar offerings from a competitor. Unfortunately, competitive advantages are typically temporary because competitors often seek ways to duplicate the competitive advantage. In turn, organizations must develop a strategy based on a new competitive advantage. When an organization is the first to market with a competitive advantage, it gains a first-mover advantage. The first-mover advantage occurs when an organization can significantly impact its market share by being first to market with a competitive advantage. FedEx created a first-mover advantage by creating its customer self-service software, which allows people and organizations to request parcel pickups, print mailing slips, and track parcels online. Other parcel delivery companies quickly began creating their own online services. Today, customer self-service on the Internet is a standard for doing business in the parcel delivery business. Page 14 As organizations develop their competitive advantages, they must pay close attention to their competition through environmental scanning. Environmental scanning is the acquisition and analysis of events and trends in the environment external to an organization. Information technology...
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...circumstances, samples, movements, and relationships within corporation’s internal and external surroundings. Internal environment examples are how the members of staff interrelate with other associates, including the management team, how directors interact with investors, and more. According to "Environmental Scanning" (2013), “Scanning must identify the threats and opportunities” (para. One). External environment examples are competition with other companies, technology, marketplaces favorite, and more. Business should be aware of competition, and learn from other companies’ mistakes to improve their own companies. They should take advantage of any topic the competitors are missing or adjust it if possible in their own field. For example: Most of fast- food restaurants offer a dollar menu or value menu because they noticed how profitable it could be like the way it works for McDonalds. Determine relevant business competitive strategies In order to determine which business strategies are relevant to a competitive market. The market must be identified. For example; using a technological industry versus the restaurant industry, the markets in which they compete would be different. Some techniques and practices may require the same concept to move the strategy forward. However, not all business strategies would work for both industry markets. To remain competitive in the...
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...What makes a strategy a winner? Please provide some examples. Ans. 1. Three questions can be used to test the merits of one strategy versus another and distinguish a winning strategy from a losing or mediocre strategy: a. How well does the strategy fit the company’s situation? i. To qualify as a winner, a strategy has to be well matched to industry and competitive conditions, a company’s best market opportunities, and other aspects of the enterprise’s external environment. Unless a strategy exhibits a tight ft with both the external and internal aspects of a company’s overall situation, it is likely to produce less than the best possible business results. b. Is the strategy helping the company achieve a sustainable competitive advantage? i. The bigger and more durable the competitive edge that a strategy helps build, the more powerful and appealing it is. c. Is the strategy resulting in better company performance? i. Two kinds of performance improvements tell the most about the caliber of a company’s strategy: (1) gains in profitability and financial strength and (2) gains in the company’s competitive strength and market standing. 2. Strategies that come up short on one or more of the above questions are plainly less appealing than strategies passing all three test questions with flying colors. CORE CONCEPT: A winning strategy must fit the enterprise’s external and internal situation, build sustainable competitive advantage, and improve company performance...
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...Global Strategy – Analysis and Practice BUSI 1271 This Lecture’s Focus & corresponding Learning Objectives The exploring Strategy model Moving from Strategic Analysis to Strategic Choice 4–3 Sources of Superior Profitability Basic Objective: Survival!!! RATE OF PROFIT ABOVE THE COMPETITIVE LEVEL INDUSTRY ATTRACTIVENESS Where to compete? CORPORATE STRATEGY How do we make money? COMPETITIVE ADVANTAGE How should we compete? BUSINESS STRATEGY 4–4 Business Level Strategy Definition Competitive advantage is to be attained by achieving a strategic fit between an organisation’s internal capabilities & its external environment. In order to maintain strategic fit organisations will need to constantly scan their environment & adjust their internal capabilities in order to exploit opportunities as they arise. Key Concepts: Generic Strategy (Porter, 1985) The Strategy Clock (Bowman & D’Aveni, 1995) 4–5 The importance of Generic (Business) strategies: Example 1/2 2004 2005 2006 2007 2008 2009 Increase (%) Ryanair EasyJet Lufthansa 26,6 24,3 50,9 33,4 29,6 51,3 40,5 32,9 53,4 49,0 37,2 62,9 57,7 43,7 70,5 65,3 46,1 76,5 145,5% 89,7% 50,3% British Airways Air FranceKLM 36,1 35,7 35,6 33,0 33,2 33,1 -8,3% 48,7 48,2 53,8 56,5 74,8 74,4 52,8% Total number of passengers (in millions) 4–6 The importance of Business strategies: Example 2/2 2004 Av. fare %>...
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... Core Competence, Distinctive Competence, and Competitive Advantage: What Is the Difference? ANN MOONEY STEVENS INSTITUTE OF TECHNOLOGY HOBOKEN, NEW JERSEY ABSTRACT. Core competence, distinctive competence, and competitive advantage ABSTRACT. are 3 of the most important business concepts that managers, researchers, and educators rely on for decision making, pedagogy, and research. However, little attention has been paid to defining these concepts. As a result, they have become buzzwords that are used so frequently that their meanings are often taken for granted but are not fully understood. In this article, the author reviews the evolution of these concepts in business literature and provides comprehensive definitions, conceptual models, and examples to help clarify and distinguish the concepts so that failures of communication can be avoided. Keywords: competencies, competitive advantage, strategy Copyright © 2007 Heldref Publications 110 Journal of Education for Business S R ince its genesis in the mid-20th century, the study of business disciplines has become an established academic discipline. The proliferation of business curricula, journals, and academic and professional associations is evidence of a dramatic growth in business education. Although the growth has improved the understanding of business and informed business practices, with growth comes various problems. For example, business practitioners, researchers, and educators...
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...LECTURE 1 Fundamental Concepts of Information Systems Learning Objectives Understand the concept of a system and how it relates to information systems Explain major components of an information system Present major types of information systems in the business world Explain how a firm can use IT to gain competitive advantages What is a system? A system Is a set of interrelated components With a clearly defined boundary Working together to achieve a common set of objectives By accepting inputs and producing outputs in a transformation process A computer, an organization Example: What is an Information System? An organized combination of… People Hardware and software Communication networks Data resources Policies and procedures Collects, processes, stores, and disseminates information in an organization This system… Information systems model Components of an IS People Resources End users: the people who use the IS or the information from the IS IS specialists: the people who develop and operate IS All physical devices used in information processing Machines, data media, peripherals All information processing instructions including programs and procedures System software, application software and procedures Hardware Resources Software Resources Components of an IS (cont.) Data Resources Facts about the business transactions...
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...information system plays in organizations pursuit of competitive advantage: 3 Competitive Strategies 3 Cost leadership 3 Differentiation 3 Innovation Strategy 3 Growth (including mergers and acquisitions) 3 Strategic Alliance 3 Business Eco-systems and Co-opetition (Competition & Cooperation) 3 The Competitive Forces Model 3 Information systems can improve overall performance of business units by promoting synergies and core competencies 3 Core competencies 3 Network-based strategies 3 Sustaining competitive advantage 3 Performing strategic systems analysis 3 Managing strategic transitions 3 Product differentiation 3 Focus on market niche 3 Strengthen customer and supplier intimacies 3 Conclusion 3 Recommendations 3 References 3 Abstract: Daily life today requires the use of information technology systems. Endeavour such as education, manufacturing, research etc, treat information systems as a need. Information system (IS) combines hardware, software, infrastructure and trained personnel to facilitate planning, control, coordination, and decision making in an organization. Gaining competitive advantage is critical for company survival and success. Therefore, development and implementation of strategies to effectively counter the competitive forces is required. The solution is the application of Management Information System (MIS) as a critical enabler of competitive strategies like cost leadership, differentiation, innovation,...
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...topics: Achieving Competitive Advantage and International Business. It is a great pleasure to be standing here in from of all of you today as I share my thoughts on some of the hottest business topics today, which are achieving Competitive Advantage and International Business. Show of hands, how many people feel that competitive advantage in business is an important topic to discuss? As over 90% of the crowd raised their hands, I felt that they were well aware of what competitive advantage is and very interested in my speech today. The other 10% that did not raise their hands will understand more about this business topic and I will address any questions that are necessary. I will begin this speech by defining competitive advantage. It is a position of a company in a competitive landscape that allows the company earning return on investments higher than the cost of investments. The goal is to keep money and sustain its position against competitors. Achieving competitive advantage strengthens and positions a business better within the business environment. As I have given everyone a brief explanation of what competitive advantage is, I will be discussing and connecting international business to competitive advantage. My thoughts on this subject is that upgrading a business system can create a gain in financial and operational field, return on investments give businesses an extra strategy to create competitive advantage. Competitive Strategy, Competitive Advantage, and...
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...Operational efficiency is performing operations tasks well, even better than competitors. Strategy, on the other hand, is a plan for competing in the marketplace. Operational efficiency and strategy must be aligned; otherwise, you may be very efficiently performing the wrong task. The role of operations strategy is to make sure that all the tasks performed by the operations function are the right tasks. These include developing an understanding of what business the company is in (the company’s mission), analyzing and developing an understanding of the market (environmental scanning), and identifying the company’s strengths (core competencies). _Mission A statement defining what business an organization is in, who its customers are, and how its core beliefs shape its business. Environmental scanning Monitoring the external environment for changes and trends to determine business opportunities and threats. What Does Environmental Scanning Tell Us? Environmental scanning allows a company to identify opportunities and threats. For example, through environmental scanning we could see gaps in what customers need and what competitors are doing to meet those needs. forming partnerships with international firms, called strategic alliances _Core competencies The unique strengths of a business. Core Competencies The third factor that helps define a business strategy is an understanding of the company’s strengths. These are called core competencies. In...
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...Information Systems for Competitive Advantage CHAPTER Strategic Information Systems for Competitive Advantage Rosenbluth International: Competing in the Digital Economy 3.1 Strategic Advantage and Information Technology 3.2 Porter’s Competitive Forces Model and Strategies 3.3 Porter’s Value Chain Model 3.4 Interorganizational Strategic Information Systems 3.5 A Framework for Global Competition 3.6 Strategic Information Systems: Examples and Analysis 3.7 Implementing and Sustaining SIS Minicases: (1) Cisco Systems/ (2) Aeronautica Civil 89 LEARNING OBJECTIVES 3 After studying this chapter, you will be able to: Describe strategic information systems (SISs) and explain their advantages. Describe Porter’s competitive forces model and how information technology helps companies improve their competitive positions. Describe 12 strategies companies can use to achieve competitive advantage in their industry. Describe Porter’s value chain model and its relationship to information technology. Describe how linking information systems across organizations helps companies achieve competitive advantage. Describe global competition and global business drivers. Describe representative SISs and the advantage they provide to organizations. Discuss the challenges associated with sustaining competitive advantage. ROSENBLUTH INTERNATIONAL: COMPETING IN THE DIGITAL ECONOMY PROBLEM ➥ THEInternational (rosenbluth.com) is a major global player in the extremely Rosenbluth competitive travel agent industry...
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...do with technical and specific information. “Strategic marketing means looking at the whole of a company’s portfolio of products and markets, and managing the portfolio to achieve the company’s overall goals”. (Jain, 1987). “ Strategic marketing as seen as a process consisting of:analyzing environmental, market competitive and business factors affecting the corporation and its business units,identifying market opportunities and threats and forecasting future trends in business areas of interest for the enterprise ,and participating in setting objectives and formulating corporate and business unit strategies. Selecting market target strategies for the productmarkets in each business unit, establishing marketing objectives as well as developing, implementing and managing the marketing program positioning strategies in order to meet market target needs”. (Drucker, 1973) Its role is to direct the firm or company towards attractive economic opportunities. The opportunities that are adapted to resources and knowledge and offer a potential for growth and profitability. Strategic marketing includes the way to reach the customers with products and services. It provides competitive advantage by considering segmentation, branding, marketing messages, and positioning. With segmentation, firm can concentrate specifically to particular market as per their buying behavior or lifestyle. As a result, it saves time and money that could be wasted on marketing blindly. The 4 P’s of strategic marketing...
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