Business Strategy Concerns – A competitive strategy consists of a company’s business approaches and initiatives by attracting customers and meeting their expectations, strengthening their market position.
Thompson and Strickland’s definition emphasizes the “views and initiatives” of managers in determining strategy. Therefore, competitive strategy refers to the measures taken by managers to improve the company’s market position by satisfying customers.
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The concept of competitive strategy (as opposed to cooperative strategy) focuses on the competitor. Competitive strategy includes approaches that define different ways to create a sustainable competitive advantage.
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The management action plan is the main focus of the competitive strategy. The management adopts a plan of action to compete successfully with the competitors in the market. It also aims to provide higher value to customers.
The goal of competitive strategy is to achieve a competitive advantage by meeting the needs of customers and ultimately over competitors (or competing companies.).
Michael Porter identified four types of competitive strategies that can be used in any business organization, regardless of the size and nature of the products. Because all business ventures are easy to use in common, they are labeled generic strategies.
Apart from these, strategic alliance, joint partnership, merger, acquisition, vertical integration, outsourcing strategy etc. There are other strategies that a company can use as needed.
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Competitive advantage is superior to competitors. Managers often ask the question, “How long does a competitive advantage last?”
‘Barriers to imitation’ create barriers for competitors to easily copy a company’s distinctive competencies. Competitors will always try to copy a company’s resources and capabilities.
Resources Tangible resources (eg, plant and machinery, buildings) are easier to sample than intangible resources (eg, patents, goodwill, brand names, technological know-how, marketing techniques).
Thus, it is necessary to create a distinctive competence based on unique capabilities rather than material resources. This will help the company to have a unique competence in the long run.
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If competitors are committed to doing business in a certain way, they will not suddenly copy the company’s innovations.
A third factor in the sustainability of distinctive competence is industry dynamism, which is an important determinant of competitive advantages.
For example, the software industry, the electronics industry and the computer industry are very dynamic due to the high innovation. Competitive advantages in such industries are short-lived.
Since gaining and maintaining a competitive advantage is the main objective of competitive strategies, managers must take measures to maintain competitive advantage.
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As mentioned earlier, a company has a competitive advantage if it can maintain an industry average profit rate for several years.
By focusing on these building blocks, Apple Computer Company enjoyed a long-term competitive advantage from 1987 to 1993.
These are called “generic” because any organization can adopt them regardless of their products (or the industry in which they do business).
High efficiency allows the company to reduce its costs; High quality allows him to reduce costs and pay a high price; Higher customer responsiveness allows it to charge higher prices, and higher innovation may lead to higher prices or lower unit costs.
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As distinctive competencies are developed, they help improve performance in all areas of the four building blocks.
Specific competencies must be developed in all relevant areas – in some areas at the expense of other important areas. Companies must balance their pursuit of distinctive competencies.
Maintaining a competitive advantage requires an inherent environment within the organization that promotes learning within the organization (commonly referred to as organizational learning).
Learning organizations can stay ahead of all their competitors because they are always on the lookout for knowledge.
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In the process of seeking and disseminating knowledge, they learn from past mistakes and improve their work processes over time.
Continuously improving the quality of products and services (in fact, everything a company does) to maintain a long-term competitive advantage.
Some organizations have succeeded in improving quality through total quality management (TQM) programs and business process reengineering.
Organizations evaluate (search for) successful work practices of other competitors/companies and then adopt them after necessary adjustment.
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In doing so, they can create and maintain resources and capabilities – essential to achieve excellence in efficiency, quality, innovation and customer responsiveness.
Companies can overcome barriers to change through effective leadership, making necessary changes in organizational structure, establishing appropriate control systems and involving employees in decision-making.
In order to be competitive in the market, a business organization must have distinctive competence in one or more areas of its activity.
Distinctive competencies refer to the strengths of an organization that give it a competitive advantage in the market.
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These strengths are unique to the organization and they help it achieve high efficiency, quality, innovation and customer responsiveness.
It can be argued that PepsiCo has a unique competence in the production of bottled water – Aquafina.
However, the resources of an organization must be unique (ie no other company has the resources) to be considered unique competencies. Resources are physical, human, financial, informational and technological.
It can be said that an organization does not need unique resources to develop a distinctive competence, unless other competitors have such resources. An organization can create distinctive competencies while simultaneously possessing unique resources and using them effectively.
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Successful strategies often build on a firm’s existing competitive competencies or help the firm develop new ones.
Business strategy is broader than competitive strategy. Business strategy includes all measures and approaches to fight against competitors, management of various strategic issues.
Hill and Jones noted that business strategy consists of planning action through which strategic managers use the company’s resources and distinctive competencies to gain a competitive advantage over its competitors in the market.
When conducting business, companies face many strategic challenges. In order to survive in the market, management must effectively address these issues.
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Business strategy addresses these issues and “how to compete.” On the other hand, competitive strategy deals with “management’s plan of action to compete successfully and provide superior value to customers.” During my last Applied Business Architecture course, students were asked to define the responsibilities of a Business Architect in a sentence. Although the concept of business architecture is part of general enterprise architecture, business architect focuses on defining the business domain and defining the strategy. “Are you beginning to transform your business or enterprise with it?” In this article I provide more information about the advantages of changing the business field with the enterprise.
A business architect translates and contextualizes strategy for operational needs and develops specialized artifacts such as business opportunity maps and value streams to bridge the gap between strategy and execution. In addition to developing concrete results, approaches and approaches, a business architect synthesizes and synergizes the work of others from disciplines such as strategy development, business analysis, process management, operations and systems analysis.
In this Applied Business Architecture course, we take it a step further. We answer the question: “How do we go from strategy to execution?” We answer this question by using opportunity maturity supplements. Identifying stakeholders and understanding their concerns is a critical and sometimes overlooked task. Extras:
To better understand the concerns of stakeholders, we need a deeper understanding of the relationships between overlays as shown in Figure 1. To begin this assessment, we begin by covering the strategy. The core model is the Business Potential Model (BCM). BCM is a fundamental architectural approach that describes the capabilities that must be met to meet the strategy of an enterprise. In addition to helping to demonstrate an enterprise’s capabilities, models can provide added value by assessing multiple dimensions such as people, process, data and technology to determine their maturity. The capabilities are defined at different levels. When mapping capabilities, it is customary to work top-down, starting at the overall level and moving to capability areas, sub-capabilities and process tasks.
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The relationship between strategic coverage and current maturity coverage: “Am I achieving my strategy?” It helps to answer the question. Answering this question makes sense after the business architect captures the tactical and strategic enterprise goals. If the enterprise is sensitive enough. Changed, the strategy cannot be achieved. The business architect must define the necessary capabilities to implement the strategy.
Another contrast is between strategy coverage and Pain Points coverage, which looks at how the strategy aligns with management issues and focus areas (stakeholder interest). Which raises the next concern: “Am I failing enough? Tactical questions?” Area is low, this weakness can lead to pain points that limit the company’s ability to achieve its strategic goals.
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