Competitive Advantage And Competitive Strategy

1714 Words Aug 14th, 2015 7 Pages
COMPETITIVE ADVANTAGE

If a value creating strategy is implemented by an Organization and it is not being implemented at the same time by another organization, one can say the organization has a competitive advantage over its competitors. It is imperative for a firm to choose the height of competitive advantage it wants to attain in the industry. An organization must aim to initiate a profitable and sustainable spot against your competitors in the same industry. WHAT IS COMPETITIVE STRATEGY?

Competitive strategies are long term plans/steps by which an organization achieves a competitive advantage in the market over its rivals.
There are three primary competitive strategies that are commonly implemented by organizations. They are cost leadership, differentiation and a focus strategy.
But Michael E. Porter argued that there are five competitive forces that play a significate role in a firm’s success or failure;
1. The entry of fresh rivals (competitors),
2. The threat of substitutes,
3. The bargaining ability of suppliers,
4. The bargaining ability of buyers,
5. The rivalry among the present competitors
The combination of these five competitive influences will determine the power of a firm in any industry.

COST LEADERSHIP STRATEGY
This strategies focus on buying raw materials that are the highest quality at the lowest price. The Human Resource must also use the…
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