Strategies to Fight Low Cost Rivals
STRATEGIES TO FIGHT LOW COST RIVALS
In this new era, which global industry is growing very fast, it makes most company everywhere in the world trap on war of price. Most companies should invest a lot of money, people, and time to fight they rivals .Last but not Least, each company has to grow with a right strategy.
The steps to get the best strategy on the Price War situation is strategy development and implementation :
A. Critical Success Factors :
1. Environmental Analysis - identify SWOT - understand the environment, customers ,industry, and competitors
2. Determine Corporate Mission
- state the reason for the firm’s existence and identify the value it wishes to create
3. Form a strategy
- build a competitive advantage, such as low price, design or volume flexibility, quality, quick delivery, dependability, after-sales services, broad product lines, differentiation, flexibility, etc Choose The Strategy (3 strategies that relevant through the Price War Situation
• Differentiation (defense), ex : STARBUCKS
• Low Cost Leadership (attack), ex : EasyShare, Southwest
• Wait and watch / Competing on Response (attack and defense)à Full of flexibility, ex : ING, HSBC
Then it’s time to achieving competitive advantage through Operations as the part of the Functional Areas Core Competencies
B. Core Competencies :
Support a core competence and implement strategy by identifying and executing the critical success factors in the functional areas :
1. Marketing = 4P+Service+Chanels distributions
2. Finance/Accounting = Leverage, cost of capital, working capital, receivables, payables, financial control, lines of credit
3. Operations = 10 OM decisions
(Product,quality,process,location,layout,human resource,supply chain,
In this new era, which global industry is growing very fast, it makes most company everywhere in the world trap on war of price. Most companies should invest a lot of money, people, and time to fight they rivals .Last but not Least, each company has to grow with a right strategy.
The steps to get the best strategy on the Price War situation is strategy development and implementation :
A. Critical Success Factors :
1. Environmental Analysis - identify SWOT - understand the environment, customers ,industry, and competitors
2. Determine Corporate Mission
- state the reason for the firm’s existence and identify the value it wishes to create
3. Form a strategy
- build a competitive advantage, such as low price, design or volume flexibility, quality, quick delivery, dependability, after-sales services, broad product lines, differentiation, flexibility, etc Choose The Strategy (3 strategies that relevant through the Price War Situation
• Differentiation (defense), ex : STARBUCKS
• Low Cost Leadership (attack), ex : EasyShare, Southwest
• Wait and watch / Competing on Response (attack and defense)à Full of flexibility, ex : ING, HSBC
Then it’s time to achieving competitive advantage through Operations as the part of the Functional Areas Core Competencies
B. Core Competencies :
Support a core competence and implement strategy by identifying and executing the critical success factors in the functional areas :
1. Marketing = 4P+Service+Chanels distributions
2. Finance/Accounting = Leverage, cost of capital, working capital, receivables, payables, financial control, lines of credit
3. Operations = 10 OM decisions
(Product,quality,process,location,layout,human resource,supply chain,