Building Competitive Advantage Through Market Based Management Practices
Building Competitive Advantage Through Market Based Management Practices
In 21st Century Management practices, firms and corporations are constantly seeking the leg-up on the competition to increase profits and long-term value creation.
In an increasingly global environment, competition remains stiff if not more competitive than ever before. Representing indirect forces on competitive advantage for companies, globalization and national and international business/trade laws have an increasing impact on competitive measures that firms may take.
In Contemporary Management by Jones and George, Competitive Advantage is defined as “the ability of one organization to outperform other organizations because it produces desired goods or services more efficiently and effectively than its competition” (2009). Competitive Advantage is a vast concept that encompasses many ideas and concepts into the overall paradigm in creating value and advantage for a company. It is important to note however that competitive advantage should not be utilized alone as a means for merely creating immediate profit. However, in todayʼs competitive and global environment, competitive advantage is often inner-twined with value creation and market based management principles for “creating long-term profits
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when specializing in activities that create the most value for customers at the least cost” (Koch 1993).
Within any market or industry, it is outwardly apparent that some firms/companies often outperform others. For instance, Wal-Mart has been very successful in strategically outmaneuvering numerous companies throughout the years and gaining a competitive advantage over companies that are now long-gone or dwindling. When a company sustains profits that exceed the average for the industry, the company is said to possess a competitive advantage (Jones & George 2009).
Competitive advantages exist within a market due to the appropriate application of the core
In 21st Century Management practices, firms and corporations are constantly seeking the leg-up on the competition to increase profits and long-term value creation.
In an increasingly global environment, competition remains stiff if not more competitive than ever before. Representing indirect forces on competitive advantage for companies, globalization and national and international business/trade laws have an increasing impact on competitive measures that firms may take.
In Contemporary Management by Jones and George, Competitive Advantage is defined as “the ability of one organization to outperform other organizations because it produces desired goods or services more efficiently and effectively than its competition” (2009). Competitive Advantage is a vast concept that encompasses many ideas and concepts into the overall paradigm in creating value and advantage for a company. It is important to note however that competitive advantage should not be utilized alone as a means for merely creating immediate profit. However, in todayʼs competitive and global environment, competitive advantage is often inner-twined with value creation and market based management principles for “creating long-term profits
2
when specializing in activities that create the most value for customers at the least cost” (Koch 1993).
Within any market or industry, it is outwardly apparent that some firms/companies often outperform others. For instance, Wal-Mart has been very successful in strategically outmaneuvering numerous companies throughout the years and gaining a competitive advantage over companies that are now long-gone or dwindling. When a company sustains profits that exceed the average for the industry, the company is said to possess a competitive advantage (Jones & George 2009).
Competitive advantages exist within a market due to the appropriate application of the core
References: New York: Crown Business, 2001. Koch, Charles G. 1993. Introduction to Maket Based Management. Retrieved September 11, 2011 from http://www.huizenga.nova.edu/5012/textbooks