strengthen the company's competitive position

 

بسم الله الرحمن الرحيم

22102013... Assalammualaikum w.b.t, hello everyone, long time no see. Today’s post is all about “Strengthening A Company’s Competitive Position: Strategic Moves, Timing, and Scope of Operations”. In the previous post, I have already talked about the five generic competitive strategy options. After the company has settled which of the five generic competitive strategies they should employ, they must take another action in order to complement its competitive approach and maximize the power of its overall strategy.  But which action the company should take? What should they do?

In order to strengthen the company’s competitive position, they must consider the competitive moves and their timing. That is whether and when to pursue OFFENSIVE OR DEFENSIVE STRATEGIC MOVES to improve a firm’s market position. Your competitor’s strengths and weaknesses should be considered in choosing the best strategy.

• Whether to undertake offensive competitive moves to improve the company’s market position. The best offensives use a company’s most powerful resources and capabilities to attack rivals in the areas where they area weakest.
• Whether to undertake defensive strategy to protect the company’s market position. The purpose of defensive strategies are lower the firm’s risk of being attacked, weaken the impact of an attack that does occur, and influence challengers to aim their efforts at other rivals.
• When to undertake it - whether advantage or disadvantage lies in being a first mover, a fast mover, or a late mover. (Sometimes being a follower is better because they can analyze the weaknesses of the first mover)

offensive and defensive...

A special kind of offensive: BLUE OCEAN STRATEGY. Have you hear about it? It is a totally invent in new market industry that other company have never or rarely do it. To avoid costly competition, firms can innovate or expand in the hope of finding a blue ocean. A blue ocean exists where no firms currently operate, leaving the company to expand without competition. Got it? An example of the company that uses this strategy was FedEx, they create delivery in just one night.

The company also can strengthen their market position via its scope of operations. The scope of the firm refers to the range of activities which the firm performs internally, the breadth of its product and service offerings, the extent of its geographic market presence, and its mix of business.  

• HORIZONTAL SCOPE is the range of product and service segments that a firm serves within its focal market. HORIZONTAL MERGERS AND ACQUISITIONS, which involve combining the operations of firms within the same product or service market, provide an effective means for firms to rapidly increase the scale and horizontal scope of their core business.
• VERTICAL SCOPE is the extent to which a firm’s internal activities encompass one, some, many, or all of the activities that make up an industry’s entire value chain system, ranging from raw-material production to final sales and service activities. VERTICAL INTEGRATION STRATEGY can expand the firm’s range of activities BACKWARD into sources of supply and/or FORWARD toward end users. It’s make strategic sense only if strengthens a company’s position via either cost reduction or creation of a differentiation-based advantage.  

Miss Ummi have told us that Malaysia was the third country that people go for outsource after China and India. Did you know what “Outsource” is? OUTSOURCING STRATEGIES narrow the scope of a business’s operation was the opposite of vertical integration strategies. Outsourcing involves contracting out certain value chain activities to outside vendors.  

A STRATEGIC ALLIANCE is a formal agreement between two or more separate companies in which they agree to work cooperatively toward some common objective. Strategic alliance and cooperative partnership provide one way to gain some of the benefits offered by vertical integration, outsourcing, and horizontal mergers and acquisitions while minimizing the associated problems.

As a conclusion, I think the company should understand about all of the strategy in order to strengthen their competitive position. They should know each pros and cons of every strategy in order to make the best decision in choosing which strategy they want to implement. that's all from me. peace no war!!!

Ya ALLAH, ketika aku melakukan kesalahan kepada mereka, anugerahkanlah aku kekuatan untuk meminta kemaafan,
manakala diwaktu mereka melakukan kesalahan kepadaku, anugerahkanlah aku kekuatan memberi kemaafan...