Competitive Stance PDF

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Competitive Stance ●

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Method: ○ 1. Identify Trends, Evidence and Uncertainties ○ 2. Interpret Trends and Uncertainties together - Competitive stance + implications ○ 3. Evaluate challenges, moves + future moves, what do uncertainties mean? ■ Use uncertainties + Strategic Options ○ Execution: ■ 1) What is the company’s competitive stance? ● a) Blue ocean: ○ Increased value = low cost = mass market ○ Different to all industries in existence ○ Characteristics: 1, Focused, 2, Divergent, 3, Compelling Tagline ● b) Premium: ○ Price insensitive ○ Particular segment ● c) Differentiation: ○ WTP (Willingness To Pay) ○ Customised (Threshold/Differentiating activities) ● d) Economy: ○ Price sensitive ○ Standardised ○ Control cost ○ Economies of scale ■ 2) Does competitive stance have performance implications ● . ■ 3) Does competitive stance of other companies have implications for firms performance: ● . ■ 4) What challenges would firm confront if it changed competitive stance? ● . Factors: ○ Banners view of focused differentiation → premium with porter ○ Raynor and Ahmed (2013) excellent firms: increase cost = price of excellence → 3 rules: ■ 1. Better before cheap ■ 2. Revenue before cost ■ 3. No other rules ○ Industry profit depends on: ■ 1) Threat of substitutes ■ 2) Rivalry ■ 3) Entrants ■ 4) Supplier/Buyer power ○ Aim → Tactic → Method → Competitive stance → Who to compete with Competitive stance + PEST ○ Advantages

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■ Operating environment - possible changes, Opportunities and Threats ■ Seek strategic moves to benefit a firm ■ Intel use 5 Forces ■ MacIntosh - 5 Forces + Pest = Good template ○ Disadvantages ■ Margetta (2012) - ill equipped to deal with intent (5 forces) ■ Public ■ Doesn’t guarantee success but costly Lectures: ○ Economic rationale (volume and cost relationship) ■ Economies of scale, Higher margins, Reduce fixed costs and Experience curve ○ Differentiation ■ WTP, Marketing, Customised features ○ Premium (focused differentiation) ■ Particular customer segment and Price insensitive customers ○ Red vs Blue Oceans; ■ Red Oceans represent all industries in existence today. ■ They have defined rules, competitors, and market boundaries. ■ Blue Oceans represent all industries NOT in existence today. ■ This is undefined market space, otherwise known as OPPORTUNITY. ■ The principle behind a Blue Ocean strategy is simple: ● To win in long term stop competing ● Value innovation is the “new” strategic logic ● Focus on differentiation and low cost to provide value ■ Three Tests of a Blue Ocean Strategy: ● Focused ● Divergent ● Compelling Tagline Related studies/theories/quotes: ○...