The human resources of the company are a source of cost advantage because they are the driving force of the organization (Jannesson, Nilsson, & Rapp, 2013). The cost advantage can be reached if the employees are equipped to be innovative, creative, productive and have excellent customer service. The processes and the practices, the intellectual properties and products, natural resources and the capital availability and the technology of the company can be used to gain a cost advantage in the industry. Also, the organizational culture and the structure or the common mission, objectives, and beliefs will help the organization to focus the abilities and the energies of the employees on positive results. Hence, the strategies of the company will be based on the sources of the cost advantage as they will be the major determinants of the organizational culture of the organization.
For a company to improve their performance so as to face their competition, they must put in place a unique panning technique. This technique will differentiate the company from others through linking the strategic planning of the organization to the decision-making especially in regards to operations of the company (McGrath, 2013). Therefore, this can be achieved by setting up a planning framework which involves all levels of the organization and facilitates decision-making concerning the resources or the customers of a company. In addition, a planning process which encourages entrepreneurial thinking should be set up. Finally, an organizational value system which supports the strategies of the company should set up in order for all the employees in the organization to work towards a common goal.
The key components of successful governance include clear strategy which will help the workforce of a company to stay focused on the mission. Also, effective management of risk is essential for a company for prevention of risks such as unexpected disasters and competition (Jannesson, Nilsson, & Rapp, 2013). Strategies such as diversification can be used to mitigate risks in the company. Discipline in the implementation of the policies, strategies, and resolutions of the company can be equally effective in governance. Moreover, treating the customers and employees fairly will ensure that a company has the best workforce and loyal customers. Transparency and responding to the social responsibility will ensure that the company has unity internally and externally. Finally, self-evaluation ensures that the company identifies and manages the issues arising at some stage in business.
The desire to be competitive in the market makes companies use the best possible message which will grab the attention of readers or viewers not caring about the legal or ethical marketing (Jannesson, Nilsson, & Rapp, 2013). The greatest ethical tensions in advertising are the puffery and the false advertisement carried out by companies who are trying to advertise their products. Puffery can be referred to as the legal promotion of products through the use of hyperbole or exaggerations. False advertisement is the use of factually false statements to promote a product. Hence, through puffery and false advertising, the advertisers are neglecting the moral values and principles which governs the decisions or actions in regards to vulnerable groups in the society such as the children, elderly and minorities.
Advertising should be kept ethical by preventing the presentation of offensive messages to the vulnerable members of the society. Hence, a number of organizations are tasked with the responsibility of ensuring that the advertisers present content which does not infringe on the rights of the vulnerable members of the society. Their role is to look into the disputed B2B practices such as puffery, misleading claims, and some free speeches intended to sell products. Some of these organizations include; National advertising division including the national advertising review council, children’s advertising review unit, and national advertising review board. Their role is to review every advertising content to make sure it is appropriate for advertising. The self-regulating groups and state regulating groups such as the federal trade commission and the patent trademark office state also have the mandate of regulating the marketing and advertising of products in regards to the regulations set.
Business owners should have information about their competitors for them to maintain have a competitive advantage over the competitors. Hence, a business owner should know who their direct and indirect competitors are to determine the appropriate activities for the business (Jannesson, Nilsson, & Rapp, 2013). Competitors can be offering same or different products or services but the business should be able to know how these competitors have positioned themselves so that the business could differentiate and become unique in the market. The pricing strategy of the competitors should be looked at for the business to know where their prices fall within what the consumers are willing to pay for the goods and services. The weaknesses and strengths of the competitors should be learned to give the business an opportunity to improve and serve customers better.
The sources of cost advantage in a company are the aspects which enable a company to perform better than their competitors in an industry (McGrath, 2013). These cost advantages include the human resources of an organization who are the driving force of innovation, creativity, and productiveness in accompany. Moreover, the processes and the practices of the organization can generate a competitive advantage as competitors will find it difficult to replicate. Also, the intellectual properties and products of the company such as the unique design of the products in the company can be used to gain the competitive advantage over the competitors. The natural resources, the capital availability, and technology such as machinery, biotechnology, information technology, energy, consumer products and office equipment are a source competitive advantage.
Strategic group analysis is a technique used to evaluate the positions of the companies in the competitive environment by focusing on the positions in the market as well as the factors which determine the profitability and the competitive advantage of the companies (Jannesson, Nilsson, & Rapp, 2013). The technique characterizes the strategies of different companies along with a wider range of strategic dimensions. These dimensions are based on the structure of the industry, the projects issued being featured and the profitability factors. Strategic group analysis helps in identification of the direct competitors and the basis of the competition between them. Also, it helps in determining the likelihood of an organization moving from a different strategic group to another and identification of opportunities for the companies.
Jannesson, E., Nilsson, F., & Rapp, B. (2013). Strategy, Control, and Competitive Advantage: Case Study Evidence. Berlin/Heidelberg: Springer Science & Business Media.
McGrath, R. G. (2013). The End of Competitive Advantage: How to Keep Your Strategy Moving as Fast as Your Business. Brighton: Harvard Business Press.