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This document discusses competitive advantage and strategies for achieving sustainable competitive advantage. It defines competitive advantage as when a firm earns a persistently higher profit than its rivals within the same market. The main types of competitive advantage are cost advantage and differentiation advantage. Porter's generic strategies for achieving competitive advantage are cost leadership, differentiation, and focus. Truly sustainable competitive advantage comes from combining rare, valuable, and difficult to imitate resources and capabilities to offer unique products and services.

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ashkukreja
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52 views15 pages

Final

This document discusses competitive advantage and strategies for achieving sustainable competitive advantage. It defines competitive advantage as when a firm earns a persistently higher profit than its rivals within the same market. The main types of competitive advantage are cost advantage and differentiation advantage. Porter's generic strategies for achieving competitive advantage are cost leadership, differentiation, and focus. Truly sustainable competitive advantage comes from combining rare, valuable, and difficult to imitate resources and capabilities to offer unique products and services.

Uploaded by

ashkukreja
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd

Competitive Advantage

1
Presented By:
NAMES ROLL NOS.

Prerna Dandona 22
Sagar Jadhav
Deepak Jain
Onkar Khanvilkar
Ashu Kukreja
Deeshi Mehta
Rahul Mehra 58
Saru Sood
2
What is Competitive advantage?

… a basis for the firm’s long term success?


… a basis for value creation?

Do we really know where it resides?


Can it be sustainable?

3
4
What is Competitive advantage?
“When two or more firms compete within the same
market, one firms possesses a competitive advantage
over its rivals when it earns a persistently higher rate of
profit (or has the potential to earn a persistently higher
rate of profit)”
R. M. Grant, 2000

5
The main types of Competitive
Advantage

Cost
Costadvantage
advantage
d uct
a r pro st
il r co
Sim e
ow
Competitive at l
Competitive
advantage
advantage Hig
for he
un rp
iqu ric
ep e
rod
uc
t Differentiation
Differentiationadvantage
advantage

6
Competitive strategies
by Porter

Types of competitive advantage

Low cost Differentiation

Industry-wide Differentiation
Cost leadership
Market

Niche Focus with Focus with


low cost differentiation

7
Competitive strategies
extending Porter
Types of competitive advantage

Low cost Differentiation

Industry-wide
Cost Leadership Differentiation

Market
Hybrid Strategy
Niche”
Focus with Focus with
low cost differentiation

 “In-between” there might be a successful strategy (Value for Money)


 Hybrid strategies can be more effective
8
Features of competitive strategies

Cost Leadership Differentiation


 Efficient scale  Quality
 Standardization  Innovation
 Design
 Design for low
 Credibility
production cost
 Brand name
 Control of overheads and
 Reputation
R&D
 Environmental posture
 Avoid marginal
 Customer service
customers
 Integrated services

9
Sustainable competitive advantage
What is meant by sustainable competitive
advantage?
Durable
Valuable to the firm
 Exploiting weaknesses and neutralizing threats
Unique
Difficult for competitors to imitate
Not easily substitutable

10
May competitive advantage be
sustainable?

Increased competition leads to decrease of


differences in competitive advantage
Standardization/ mass production of unique
features: What can be left for differentiation?
Unique features of differentiation become
prerequisites for survival
Dynamism & complexity of the environment

11
How can competitive advantage
be sustainable?

The firm must seek competitive advantage


in combining resources & capabilities
Develop resources and capabilities, which are
rare, valuable, non-tradable,
Make those resulting competences sustainable
by precluding imitation or substitution by
competitors
The firm must offer competitive products

12
Sustainable competitive advantage
…reflected on product

 Quality and quality of customer service


 Design
 Innovative product
 Customized product with integrated services
 Environmental friendly

13
OPEN FOR QUERIES

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