Business Competition

All posts tagged Business Competition

Organizational Focus and Discipline

Published May 2, 2014 by Mayrbear's Lair

focus on success magnifying glass

When a company is disciplined and focused on reaching their goals, they are more likely to achieve higher outcomes and greater performances. For example, during my studies at Ashford University, part of the requirements for the MBA program was a six week course on Financial Analysis. What my research work uncovered from my analysis of the KODAK Company, is that one of the reasons the corporate giant lost their competitive edge and high standing position in their industry, was because of a strategy that was intentionally implemented to focus their outputs on copying products created by their competitors at Polaroid, rather than focusing their research and development on their own innovation and creativity.

polaroid-v-kodak-p122-web

For example, Polaroid became a popular brand after the firm introduced a camera that developed photos in sixty seconds. To maintain their competitive edge, rather than using their talent and energy to develop innovative products, KODAK engaged in a strategy to copy Polaroid’s highly popular product, their Instamatic camera. In other words, KODAK was looking to profit from trying to duplicate Polaroid’s innovative ideas.

kodak

The copycat strategy was meant to help KODAK win back the marketplace. As it turned out, this was an ineffective tactic and consumers looked at it as a highly unfavorable action, especially after Polaroid took KODAK to court and won for patent infringement! Even worse, while KODAK was focused on the copycat strategy that led to the lawsuit, the Japanese Corporation Fuji, came in to dominate the 35 mm film market because KODAK also dropped the ball on their film development division due to ineffective strategic decisions made that were focused on out-maneuvering Polaroid, rather than honing their energies to develop their own unique products.

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In the end, KODAK’s reputation as an innovator was damaged, they were unfavorably perceived as copycats, while Fuji was poised to come in and dominate the marketplace because of their ability to focus and develop their high quality and inexpensive 35 mm film. This was case disclosed an excellent example of how poor strategic management at the KODAK Company caused the once industry giant to lose its competitive edge and how effective strategists at Polaroid and Fuji were able to enter the market to dominate the industry which edged KODAK out of the top spot.

Well, that wraps things up for this week’s look at competition in a business arena. Have a great weekend everyone … and keep organized!

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“Your task is not to seek for love, but merely to seek and find all the barriers within yourself you have built against it.” — Rumi

Business Competition Part 2

Published April 30, 2014 by Mayrbear's Lair

inbound-marketing-competition

Competition is the component that makes a firm unique and is effective in determining their competitive advantage (Coulter, 2010). By understanding the competitive environment, key strategic decision makers are in a better position to create the strategies required to stand out above their competitors and outperform them. This falls in alignment with the concept that businesses that are committed to adjust their strategies and continue to evolve to keep up with the market, are in a better position to grow, than those that remain stagnant because of their inability to embrace improvement or, are incapable of finding creative means to continue to develop or improve their strategies and operations.

business-competition

Without the element of business competition, companies would not need to create strategies to achieve success. Magretta (2011) explains that the most common mistake leaders make about the concept of competition is that success is achieved by being the best at something. Although this is an important component, a more effective strategy is determined by the ability to pass the following five basic tests:

  1. Is the firm creating value, which is at the root of development and helps establish a distinctive value proposition that will translate into different activities and abilities from rivals?
  2. Is the development of a tailored value chain unique to that firm?
  3. Have they developed strategies that offer compromise or trade offs, by saying no to some clients, for example, to serve others better?
  4. Do the strategies fit, relate to one another, and are they sustainable and functional?
  5. Is the company capable of continuity and how adept is the firm at keeping up with industry changes (Magretta, 2011)?

Competitive-Advantage-751925

Asking these five questions can help identify components that are effective for companies in their efforts to establish competition in a business arena. In other words, business leaders, key decision makers, and strategic planners who create a competitive advantage as a strategic weapon of choice, are in a better position to stand up to industry rivals. In conclusion, developing an effective business competition strategy is the key to creating value that in turn, helps make a firm unique.

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“Intuition is a sense of knowing how to act spontaneously without needing to know why.” ―Sylvia Clare

References:

Coulter, M. (2010). Strategic management in action (5th ed.). Upper Saddle River, NJ: Pearson Education, Inc.

Magretta, J. (2011). Understanding Michael Porter: The essential guide to competition and strategy. Boston, MA: Harvard Business Review Press.