Introduction When a firm sustains a profit that exceeds the average for its industry, the firm is said to possess a competitive advantage over its rivals. The goal of much of business strategy is to achieve a sustainable competitive advantage (SCA). (QuickMBA, 2007) Michael Porter identified basic types of advantages used by businesses. Cost and differentiation advantages are positional advantages used by organizations to achieve that competitive through creating superior value for its consumers and thus increase profits for itself. In this session long project I will discuss strategic plans including; low cost, differentiation, focus, and preemptive. By comparing each strategic plan with one of Kraft’s SWOT elements, I will discuss a tactic for taking advantage of strength, opportunity, or managing a threat or weakness, and ultimately recommending which strategic plan in order to achieve SCA. Creating a Competitive Advantage A competitive advantage exists when the firm is able to deliver the same benefits as competitors but at a lower cost (cost advantage), or deliver benefits that exceed those of competitors products (differentiation advantage). (QuickMBA, 2007) Creating this competitive advantage is produced using the organizations resources and capabilities b either a cost advantage or differentiated. Porter identified three basic strategies one of which is the cost leadership strategy. This strategy intends for the organization being the low cost producer in the industry. Such ways to lower prices include; improving process efficiency, vertical integration, and avoiding some cost for example. The differentiation strategy intends to development of a product or service that offers unique attributes that are vale by ... ... middle of paper ... ...9 Dec. 2013. . Moeller, Scott. "Case study: Kraft’s takeover of Cadbury." Financial Times. Financial Times, 9 Jan. 2012. Web. 2 Jan. 2014. . PR Newswire. "Who is Making Good Decisions in the Reputation Economy? Amazon, Kraft and 3M, According to New Study of U.S. Consumers." Bloomberg.com. Bloomberg, 5 Apr. 2011. Web. 18 Dec. 2013. . Watrous, Monica. "Product development overhaul at heart of Kraft Foods strategy." Food Business News. SOS Land Publishing, 20 Feb. 2013. Web. 2 Jan. 2014. .
This article from the Harvard Business Review was an intriguing piece on how an established organization has to change their mindset in order to change their organization. Campbell Soup Company has been a heavyweight in the food industry for over 145 years. The article portrays how Campbell Soup began to fall behind its competitors and needed to change. They did this in two very important ways. Decision making and courage were the two aspects of the company that they changed in order to grow within their industry.
Porter, Michael E. "From competitive advantage to corporate strategy." Harvard Business Review (1987): 43-59. Print. May 2014.
Bloomberg Businessweek (201, July 14). How Yum! Brands Is Conquering the World - Businessweek. Retrieved January 28, 2014, from http://www.businessweek.com/globalbiz/content/jul2010/gb20100714_088544.htm
Differentiation through distribution, including distribution via mail order or through internet shopping. For example u can buy Monster from Amazon.com.
We have carried out a study on the F.M.C.G Company Heinz. Heinz is the most global U.S based food company, with a world-class portfolio of powerful brands holding number 1 and number 2 market positions in more than 50 worldwide markets. There are many other famous brand names in the company¡¦s portfolio besides Heinz itself, StarKist, Ore-Ida, Plasmon, and Watties. In fact, Heinz owns more than 200 brands around the world and makes over 5,700 varieties.
It’s interesting reading about large consumer brands and their various methodologies for consumer research as it relates to new product development. In the consumables business, P&G is the heavyweight and is the pinnacle of research with their expertise in identifying the products that resonate with consumers. They also have manufacturing and distribution dialed in which makes them the “ideal” that many manufacturing-driven organizations aspire to be like.
This case examines issues of asset control for Ben & Jerry’s Homemade, Inc., in light of the outstanding takeover offers by Chartwell Investments, Dreyer‘s Grand, Unilever, and Meadowbrook Lane Capital in January 2000.
According to the Harley Davidson case study, the author has mentioned Harley Davidson uses the differentiation strategy: focus strategy for their business level strategy. This is, the focus strategy is an integrated set of actions taken to produce goods or services that serve the needs of a particular competition segment. Thus, by using the focus strategy for their business level strategy, it can help Harley Davidson to build strong brand recognition for their products. Harley Davidson believes that they understand the dynamics of their market and the unique needs of customers within it very well. Since they serve their customers in their market uniquely well, they tend to build strong brand loyalty amongst their customers. As a result, they
In the modern world of conducting business, any company that wishes to succeed must differentiate its products or services from others in the industry. Differentiation makes it possible for consumers to point out notable differences between one company’s products as compared to those of competitors. Differentiation helps companies build brand loyalty as the uniqueness keeps customers fixed on a particular product. BMW is one of the most popular automakers in the world today. It definitely uses differentiation as a strategy to beat off competition by building products that are innovative, detailed and incomparable to those of competitors.
Sasha Chapman, “Manufacturing Taste: The (un) natural history of Kraft Dinner,” The Walrus, September 2012 http://thewalrus.ca/manufacturing-taste/
Johnson, G., Scholes, K. (2002) Exploring Corporate Strategy: Text and Cases. 6th edn. Harlow: Pearson Education Limited.
of a firm to attain new forms of competitive advantage (Müller, 2011). It is due to these
Competitive advantage is the advantage for the competitors and gained by the offerings from the consumers that have the greater value either by the low prices of the products and by providing the benefits and services to the consumers that denotes the high price. It is a set of the innovative and different features of the company and the products and services sale to the consumers so that company can achieve the targets what they have decided and it is the betterment for the enterprise in the competitive market (Porter, 2011). There are three determinants which can be used in the competitive advantage that what the company produce for their consumers, their target market that what they have to achieved and the competition from the other entity
Competitive strategy is the approach that an organisation takes in order to gain advantage over its competitors. According to Porter, there are two major sources of competitive advantages: costs and differentiation. Cost-based competitive advantage involves reducing production costs so that an organisation can earn higher profit margin or offer products at lower price compared to competitors. Differentiation-based competitive advantage involves offering unique properties that are not offered by competitors’ products. Differentiation allows an organisation to charge a premium for their products because they offer additional benefits to buyers.
We can define competitive advantage as simply what a given company excels best at. This could be the distinguishing factor as to why consumers purchase from your company and not the competition. This could also be understood from the perspective of quality that a business can create for the consumer.