How Competitive Advantage And How Does It Manage A Company 's Business Model?

Decent Essays
1. What is competitive advantage, and how does it relate to a company’s business model?
Competitive advantage is that a company has better ability in earning profit and profit growth compared to its competitors for the same group of customers in one industry.
Management level uses the business model to establish the strategies for the company’s operation and thus create competitive advantage over the company’s rivals and make more profit.

2. Describe the strategic planning model, and who is involved in the strategy-making process
There are five steps in the strategic planning model:
1. Identify the company’s mission and goals
2. Analyze the external competitive environment to identify opportunities and threats
3. Analyze the internal
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Threats: Nokia phones once dominated the phone market. However, it failed to see the threats from smartphone and the new phone manufacturer, and thus the brand Nokia faced serious strike and almost disappeared until recent.

4. What are the various levels of management, and how do they participate in the process of strategic decision making?
The various levels of managements are corporate-level managers, business-level managers, and functional-level managers.
Different levels of managers evaluate and make strategic decision from different aspects. They contribute to strategies establishment based on their own areas.
Corporate-Level Managers: Monitor and control the strategies for the entire organization, making sure the strategies consistent with the pursuing of profit.
Business-Level Managers: Be in charge of the business units and thus focus on the strategies specific to a particular business.
Functional-Level Managers: Focus on specific functions and create strategies used to achieve the goal of the above two levels’ strategies.

Chapter 2 Questions:
1. Define “Industry”, “Business” and “Sector”. How are these related?
Industry: A group of companies provide similar products or services which
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