Showing papers on "Competitive advantage published in 1980"

Competitive Strategy: Techniques for Analyzing Industries and Competitors

Abstract: Michael Porter presents a comprehensive structural framework and analytical techniques to help a firm to analyze its industry and evolution, understand its competitors and its own position, and translate this understanding into a competitive strategy to allow the firm to compete more effectively to strengthen its market position. The introduction reviews a classic approach to strategy formulation, one that comprises a combination of ends and means (policies), factors that limit what a company can accomplish, tests of consistency, and an approach for developing competitive strategy. A competitive strategy articulates a firm's goals, how it will compete, and its policies for achieving those goals. Competitive advantage is defined in terms of cost and differentiation while linking it to profitability. Part I, "General Analytical Techniques," provides a general framework for analyzing the structure of an industry and understanding the underlying forces of competition (and hence profitability). Five competitive forces act on an industry: (1) threat of new entrants, (2) intensity of rivalry among existing firms, (3) threat of substitute products or services, (4) bargaining power of buyers, and (5) bargaining power of suppliers. Looking at industry structure provides a way to consider how value is created and divided among existing and potential industry participants. One competitive force always captures essential issues in the division of value.There are three generic competitive strategies for coping with the five competitive forces: (1) overall cost leadership, (2) differentiation, and (3) focus. There are risks with each strategy. A firm without a strategy is "stuck in the middle." This framework for examining competition transcends particular industry, technology, or management theories. Building on this framework, techniques are presented for industry forecasting, analysis of competitors, predicting their behavior, and building a response profile. Essential for a competitive strategy are techniques for recognizing and accurately reading market signals. Implications of structural analysis for buyer selection and purchasing strategy are presented. Game theory provides concepts for responding to competitive moves. Using the concept of strategic groups, structural analysis can also explain differences in firm performance (profitability), provide a guide for competitive strategy, and predict industry evolution. Part II, "Generic Industry Environments," shows how firms can use the analytical framework to develop a competitive strategy in industry environments, which reflect differences in industry concentration, state of industry maturity, and exposure to international competition. These environments determine a business's competitive strategic context, available alternatives, and common strategic errors. Five generic industry environments are examined: fragmented industries (where level of industrial concentration is low), emerging industries, transition to industry maturity, declining industries, and global industries. In each, the crucial aspects of industry structure, key strategic issues, characteristic strategic alternatives (including divestment), and strategic pitfalls are identified. Part III, "Strategic Decisions," draws on the analytical framework to examine important types of strategic decisions confronting firms that compete in a single industry: vertical integration, major capacity expansion, and new business entry. Additional use of economic theory and administrative consideration of management and motivation helps a company to make key decisions, and gives insight into how competitors, customers, suppliers, and potential entrants might make them. Appendix A discusses use of techniques for portfolio analysis applied to competitor analysis. Appendix B provides approaches to conducting an industry study, including sources of field and published dat

Industry Structure and Competitive Strategy: Keys to Profitability

Abstract: (1980). Industry Structure and Competitive Strategy: Keys to Profitability. Financial Analysts Journal: Vol. 36, No. 4, pp. 30-41.

Competitive Strategy: Techniques for Analyzing Industries and Competitors

Abstract: Now nearing its 60th printing in English and translated into nineteen languages, Michael E. Porter's Competitive Strategy has transformed the theory, practice, and teaching of business strategy throughout the world. Electrifying in its simplicity -- like all great breakthroughs -- Porter's analysis of industries captures the complexity of industry competition in five underlying forces. Porter introduces one of the most powerful competitive tools yet developed: his three generic strategies -- lowest cost, differentiation, and focus -- which bring structure to the task of strategic positioning. He shows how competitive advantage can be defined in terms of relative cost and relative prices, thus linking it directly to profitability, and presents a whole new perspective on how profit is created and divided. In the almost two decades since publication, Porter's framework for predicting competitor behavior has transformed the way in which companies look at their rivals and has given rise to the new discipline of competitor assessment. More than a million managers in both large and small companies, investment analysts, consultants, students, and scholars throughout the world have internalized Porter's ideas and applied them to assess industries, understand competitors,, and choose competitive positions. The ideas in the book address the underlying fundamentals of competition in a way that is independent of the specifics of the ways companies go about competing. Competitive Strategy has filled a void in management thinking. It provides an enduring foundation and grounding point on which all subsequent work can be built. By bringing a disciplined structure to the question of how firms achieve superior profitability, Porter's rich frameworks and deep insights comprise a sophisticated view of competition unsurpassed in the last quarter-century. Book Description Publication Date: June 1, 1998 | ISBN-10: 0684841487 | ISBN-13: 978-0684841489 | Edition: 1 Clique Aqui

The Philosophy of Management

Abstract: The period 1890-1940 marks the first systematic attempt to analyze and understand how commercial organizations function. Prior to this period, most attention had been focused on inputs into business - specifically the three factors of production: land, labour and capital - and to a much lesser extent, on the products and services they produced and sold. Now, businessmen and social scientists alike began turning their attention to the organization itself: how it was formed, how it was organized and controlled, and how it functioned. In doing so, they laid the groundwork for the field that we know today as organization behaviour. This set includes work by both academics and practitioners, including some of the leading business thinkers of the early 20th century: Elton Mayo, Mary Parker Follett, Dexter Kimball and Lillian Gilbreth. Together, the submissions show how new disciples like psychology and sociology as well as the principles of scientific management were brought to bear on the problem. Then as now, the problems faced by the managers of large businesses were both practical and moral - how to achieve mazimum efficiency, how to create a workplace climate that attracted the most highly skilled and loyal employees, how to ensure efficient communication and promote innovation, and how to achieve lasting competitive advantage and success. (Many of these themes were also touched on in the earlier set, "Human Resource Management", and "Organization Behaviour" serves as a companion to that collection). These works represent a foundational view of the discipline: later sets may explore individual aspects of organization and behaviour in more detail.

Situational Segmentation of Industrial Markets

Abstract: Proposes that grouping industrial market transactions into separate segments can be aided by use of individual dimensions and combinations of dimensions. Examines the idea that knowledge about the composition of the decision‐making unit or buying centre in specified situations helps marketers to design or modify communication programmes – concentrating attention on those market segments to which the competitive advantages are most meaningful. Uses interviews with purchasing personnel (over several years with more than 30 organisations in the USA, of differing products/services, location and size). Says there is a four dimensional classification system for industrial buying situations and these are: buyers' familiarity with the buying task (new or rebuy); product type; importance of the purchase to the buying organisation; and principal type of uncertainty present in the purchase situation. Goes on to discuss these and uses tables for extra emphasis in explanation. Concludes that interview data suggest that the use of situational segmentation, when combined with segmentation based on ability to refine market programmes, select the most promising on which to focus.

Metagame analysis of competitive strategy

Abstract: The need for effective competitive strategy planning for a firm's survival and growth has long been recognized to be important The identification and selection of good, or robust, market strategies must be based on the anticipation of the likely strategies of significant competitors, who should ideally be visualized as undergoing a similar process of assessing their own and other's goals and probable strategies This paper reviews and evaluates the traditional economic and game theoretic approaches to competitive strategy analysis and presents an application of metagame analysis—an approach which has not previously been used in the strategic business environment This approach, which appears to have some significant advantages over both economic and game theoretic approaches has been utilized and evaluated in a business firm (Dutta and King, forthcoming) An illustration of its use, which is based on a real-world application, is discussed

Structural Factors in the Exit Decision Within Declining Businesses.

Abstract: The conceptual construct, exit barriers, is expanded using both statistical findings and the results of field studies. The immobility of resources, it is suggested, can be overcome by helping margi...

Research in Japanese Construction Industry

Abstract: In-house research by private companies is fundamental to the technological advancement of the Japanese construction industry. Shortly after World War II several of the largest construction companies established research institutes. These institutes have since grown and become an integral part of Japanese construction. Many have laboratories with highly educated professional research staffs working with large-scale and technologically complex research equipment that makes them among the best construction research facilities in the world. This research transcends all disciplines related to construction and a large fraction is similar to the fundamental and applied research one finds in U.S. universities. This research enjoys strong top-management support and the research institutes are recognized as important resources by the operations personnel in the companies. Benefits and incentives include creation of new markets, solving practical field problems, corporate prestige, gaining a keener competitive edge, substantiating claims, proving compliance with regulations, and advancing Japan to the forefront of world construction technology.

Competitive strategies: a cognitive choice model

Abstract: A theory of competition between firms in heterogeneous markets is formulated using a psychological model of choice, the heteroscedastic form of the Thurstone random strength model. Market shares are defined in terms of random variables which portray individual variation in perceived utility. The analysis focuses on the relationship between market shares and utility variances. Besides the general theory of competition two special cases are analyzed, each of which can be identified without precise knowledge of the utility parameters. The conclusions tend to support conventional marketing wisdom but emphasize that the degree of dominance of the market leader is a significant factor in its competitive strategy. Short and long-run analyses of the model are presented, and it is shown that the best policy for a particular firm in the short run remains optimal in the presence of competitors' reactions, but it may no longer be effective. The paper concludes with some comments on statistical implementation.

Formulating a strategy of superior resources

Abstract: The grass may seem greener in another field, but take a long, hard look before your company diversifies. The pitfalls of scattering your resources—technology, knowledge, management, human skills, and finances—can mean disaster. Concentrate instead on focusing your energies and gaining competitive advantage.

Strategies of Effective Low Market Share Businesses.

Abstract: This is a multivariate analysis of the product-market choices and competitive strategies of effective low share businesses. The study includes two control groups: effective high share and ineffecti...

Construction Joint Ventures

Abstract: A construction joint venture is a partnership of contractors who have formed a business alliance for the purpose of undertaking a project. Motivation for such an alliance may be technological complexity, political expediancy, large size, or high risk. An analysis of the risk-sharing characteristics is presented concentrating on principles of diversification for the individual contractors and competitive advantage of the joint venture as a whole. A formulation of risk-sharing rules and basic contractor risk behavioral criteria leads to the development of a methodology for optimal joint-venture share allocation. By means of a three contractor joint-venture example the optimal allocation of shares is demonstrated, as well as a verification of principles of diversification and competitive advantage.

The national transportation policy study commission and its final report: a review

Abstract: The author calls the recommendations of this comprehensive study often vague, sometimes in conflict, and frequently lacking in details needed for implementation. No sense is conveyed of the relative importance of proposals or of possible conflicts between them. Broad themes are reliance on market, utilization of private enterprise wherever possible, avoidance of government policy which is prejudicial to market performance, subjecting of proposed policy to economic analysis, and moving of public investment decisions as far as possible toward the local level. Much is made of the weakness of the railroad industry but prospects for mergers, deregulation, restructuring and competitive advantage do not appear to offer great promise for increasing railroad capabilities. There also seems to be little promise in substituting antitrust jurisdiction for existing regulation, for relying on market forces to control energy use, and for the fostering of intermodalism.

Long-Term Social Change and Hawaii's Economy

Abstract: For much of its unified history, Hawaii has depended on a single industry to be the backbone of its economy, moving from sandalwood to whaling to sugar and, finally, to tourism. Nonetheless, economic diversification has long been seen as the path to sustained and more robust development. While there have been some achievements along the path to diversification within the past several years, dependence on tourism remains a fact of life. Much of the problem, is a focus on short-term solutions, the tendency to ignore the powerful links that exist between economic and cultural systems both locally and globally, and thus the failure to anticipate and take advantage of long- term changes in the world economy. I analyze the opportunities for successful economic diversification in Hawaii, focusing in particular (though not exclusively) on the following issues areas: • Systematically identifying Hawaii's intrinsic socioeconomic attributes and tailoring policies to them. • Analyzing long-term processes of social change in order to build long-term competitive advantage. • Broadly analyzing forward and backward linkages for emerging sectors and generating holistic policy recommendations.

Pulp and paper in the ASEAN region

Abstract: The development potential of the pulp and paper industries sector of the Association of Southeast Asian Nations (ASEAN) was analysed by the Pulp and Paper Industries Development Programme of FA0 in two stages: an indicative investigation in 1977 and a more intensive analysis in 1978-79. The 1978-79 analysis resulted in a decision by the econonmic ministers of ASEAN to implement the next investigative phase: that of feasibility studies. The approach to the analysis and subsequent strategy development was technical/political. This required that political aspirations and priorities by ASEAN member countries and the Association as a whole were considered in the selection of scenarios to be considered for evaluation and that the final choice of strategy was politically based. The analysis was made with the help of a linear/integer programming model designed to derive optimal allocation of paper manufacturing activities, geographically as well as over time. This allocation involved resource utilization, industry location, industry type and size, choice among optional manufacturing processes and product qualities, trade with non-ASEAN countries and intra-ASEAN product distribution. The results of the analysis indicate that ASEAN has a cost competitive advantage which allows the Association to manufacture and supply up to 90 percent of the projected internal requirement of the major grades of industrial and cultural papers in competition with the world market, without fiscal protection of the industry. All member countries of the Association, except Singapore, who has limited raw material resources, have a role to play in this intra-ASEAN supply of paper. An attempt to critically evaluate the approach and assess the implementability of the development strategy was made.