A market can be described as either a red ocean or a blue ocean depending on whether the industry of the market is in existence or not. To be specific, red oceans denote the already known market space where all the industries in it are existent. In the red oceans, boundary lines between industries are well-defined. Here, companies are endeavor to have a greater market share against their competitors. However, expected earnings and growth become low due to fierce competition as more and more market participants enter into the market. On the contrary, blue oceans are defined as unexplored market space where all the industries in it are not existent. In the blue oceans, not only the market is non-competitive, but also new demands are created with the potential for high growth. In order to seize an opportunity for profit and growth, blue oceans should be created.
The very first step for a company to open a blue ocean market is to define the basic unit of analysis. In numerous books and research literature relating to business, the company is regarded as the basic unit of analysis for the red ocean-based business strategy. However, no company everlastingly achieves high performance, and the same company repeat rise and fall. Consequently, the company is not an appropriate unit of analysis to investigate the origin of blue oceans and high performing companies. Instead, it is the strategic move that is a suitable unit of analysis for the blue ocean-based business strategy. The strategic move represents a managerial decision that creates a new market space by rapidly increasing demand and dominates the market space with an innovative product or service.
The approach of a company toward business strategy is the consistent criteria for de...
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...ean strategy is to strategize execution of the strategy. In implementing the blue ocean strategy, there always exists a certain amount of risk and uncertainty. Therefore, all the members must be fully aware of and trust in the ongoing strategy. For this purpose, the three E principles of fair process – engagement, explanation, and clarity of expectation – should be applied. With this specific principle, all personnel at all levels of a company act on the strategy underway.
With the six steps for successful blue ocean strategy abided by, a company can create the new uncongested market space where has never existed before. However, more and more companies enter into the blue ocean as frontiers and early followers consistently succeed in the industries. Value curve of the frontier company will be eventually imitated and a company may fall into a trap of competing with
a. Basically, corporation strategy demonstrates a corporation’s overall direction in the light of its general mindset toward growth and the management of its businesses and product portfolios. There are three crucial categories, which are stability, growth, and retrenchment, that involve within corporation strategy. Additionally, business strategy often occurs at the business unit or product level, and it highlights the improvement of the competitive position of a company’s products and service in the particular market segment served by the business unit. Competitive and cooperative strategies are two main categories that match within business strategy. Furthermore, functional strategy is the method that through a functional area to
BUSA 4126 has given me the chance to study the different business policies and strategies a company has to consider when operating. Numerous topics in this course have given me a better insight on companies that interest me such as Nike, UPS, Nestle, and the NFL to name a few. A few of the topics that interested me most were the subjects of creating and linking the companies vision and mission with its core values, key success factors, competitive advantage, key resources and capabilities, and the four test of a resources competitive power.
Market structure is classified according to the degree of competition firms encounter in their industry (Baker College, 2016). There are four main market structures: pure competition, monopolistic competition, oligopoly and a pure monopoly. Pure competition is where fir...
A market is a group of good and service for buyers and seller in economic industry (Mankiw, 2011). The buyers were included by group of demand for the product, and the sellers were included by group of supply of the product (Mankiw, 2011). A market is only for group of economic agents, which is firms and individuals, for who were interact with each other in buyer-seller relationship (Wilkinson, 2005). In general, market structure can beclassified into four major characteristics: monopoly, perfect competition, monopolistic competition and oligopoly.
As such, BlueScope is facing two comfort traps including cost-based thinking and strategic planning. In the original plan, BlueScope aimed at reducing the production costs in order to lower their prices to competitive rates. This approach, however, failed to consider revenues. Regarding strategic planning, the original plan focused on the short-term benefits rather than long-term sustainability. In order to avoid these traps, the company needs to focus its strategy on the customers rather than reducing costs.
Business strategy is the means by which firm’s plans to achieve its goals and objectives. It can also be termed as organization long-term planning. The strategy covers periods between 3-5 years and sometimes longer. Businesses use two major types of strategy, general or generic and competitive strategies. The overall strategy involves strategies of growth, globalization and retrenchment. The competitive advantage includes low pricing, product and customer differentiation. We will look at the business strategy used by Marks and Spenser (Cole, 1997). The company is a British multinational located at Westminster London and specializes in clothes and luxurious food products.
Arthur, A., Thompson, Margaret, A., Peteraf, John, E. Gamble, A., J., Strickland III. (2014). Crafting & Executing Strategy: The Quest for Competitive Advantage 19e: Concepts & Cases. C6-C25.
The strategic recommendations provided will improve and enable the business to cope with the competitors, while the implementation of the strategy section will outline the way to go about achieving these alternatives in the business setting. Lastly, we put up a discussion on the evaluation procedures and necessary controls for the business. In the case study, it was discovered that there were sources of opportunities in which the company would invest.
The Strategy plays an important and vital role in the 7-S’s Model as the strategy is the detailed plan devised to maintain and build the competitive advantage over the competition for achieving and accomplishing the targeted common goals.
Throughout the global economic environment the desire to out-perform the competition is always present. In every situation, the companies who do better are the ones with superior strategy (Rothaermel, 2013). Strategic management is therefore important in every company, no matter what industry or market they operate in; and as stated by M. Carpenter and G. Sanders, 2013, is described as "The process by which a firm manages the formulation and implementation of its strategy". Strategic management is a constant topic under discussion with different schools of theorists with different beliefs and attitudes which is described as "A tense array of disagreement" (Rees, 2012).
In a world of free trade, growing competition and accessibility to foreign markets, the need for methodical market analysis and assumptions is steadily rising in today’s business environment. It is just a normal way of thinking to primarily intent to eliminate the financial before entering a new and foreign market. This suggests that enterprises have to develop an overall strategy for their business in order to gain competitive advantage and consequently market share. With the words of Michael E. Porter, professor at Harvard University and leading authority on competitive strategy, this desirable market success is indirectly linked to the individual structure of a market. The unique structure of a single market influences the strategic behaviour and the development of a competitive strategy within a firm. The competitive strategy finally decides whether a company performs successfully on the market or not. Referring to this interpretation of business success, M. E. Porter established his five forces framework that enables directives to gather useful information about the business environment and the competitive forces in industries.
Markets have four different structures which need different "attitudes" from the suppliers in order to enter, compete and effectively gain share in the market. When competing, one can be in a perfect competition, in a monopolistic competition an oligopoly or a monopoly [1]. Each of these structures ensures different situations in regards to competition from a perfect competition where firms compete all being equal in terms of threats and opportunities, in terms of the homogeneity of the products sold, ensuring that every competitor has the same chance to get a share of the market, to the other end of the scale where we have monopolies whereby one company alone dominates the whole market not allowing any other company to enter the market selling the product (or service) at its price.
A key part of an organizational strategy is to identify market opportunities by finding a niche or a gap in the marketplace that they can pursue to take their company ahead of all their competitors. An organiz...
...lopment industry as well as the strengths and weaknesses within the company. The Business Strategy should reflect the main issues that determine the long-term
A strategy which is adopted by an organisation indicates what area the firm intends to do well in.