Michael Porter’s Value Chain and Gaining a Competitive Advantage The more value an organization creates‚ the more profitable that organization likely will be and by providing more value to your customers‚ the organization is gaining a competitive advantage. Understanding how your company creates value and looking for ways to add more value are critical elements in developing a competitive strategy. The concept was first introduced by Michael Porter in his 1985 book “Competitive Advantage.” A
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I. Operational Effectiveness Is Not Strategy According to Porter‚ various management tools like total quality management‚ benchmarking‚ time-based competition‚ outsourcing‚ partnering‚ reengineering‚ that are used today‚ do enhance and dramatically improve the operational effectiveness of a company but fail to provide the company with sustainable profitability. Thus‚ the root cause of the problem seems to be failure of management to distinguish between operational effectiveness and strategy: Management
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Michael Porter 5 Forces Porter’s five forces of competitive position analysis is a simple framework for assessing and evaluating the competitive strength and position of a business organization that formed by Michael E. Porter of Harvard Business School in 1979. Basically‚ the concept of this theory is actually based on the five forces model that uses to determine the intensity of competition and market attractiveness. Therefore‚ strategic analysts are often to use Porter’s
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Strategic Management and Michael Porter: a postmodern reading by: Toby Harfield It is an important and popular fact that things are not always what they seem. Hitchhikers’s Guide to the Galaxy Douglas Adams Introduction This article is located within a postmodern sensibility of exploration and play (Bauman 1992; Rorty 1989). I do not attempt to deconstruct (Linstead 1995; Cooper 1989; Derrida 1978)‚ but merely to explore the possiblilty of a radical new reading of Michael E Porter. Is Porter
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Michael Porters Strategy Michael Porter is the University Professor (the highest honor in Harvard University) in Harvard Business School. He is acknowledged as the father of competitive strategy. He has two main theoretical perspectives; one is “the five forces model of competition”‚ and the other one is just the “three competition strategies” (Michael Porters Strategy). The three competition strategies are cost leadership strategy‚ differentiation strategy and segmentation strategy. These strategies
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The Three Basic Economic Questions 1. What to Produce? what items to produce and how much of each item to produce using its productive inputs in the most efficient manner. 2. How to Produce? one the decision has been made regarding what to produce. each country must choose which resources productive inputs will be used and in what combinations 3. For Whom to Produce? should the productive outputs be distributed based on social customs‚ personal wealth and ownership‚ or mandated by the government
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Michael Porter’s video discusses how to gain competitive advantage and in the market place using specific strategies. Competitive advantage is the positioning of a company in its competitive environment. The starting point to have superior competitive advantage is to “improve faster than the competitors can catch up”‚ and this requires strategies. One of the strategies is broad differentiation which is defined as having a unique benefit over the competition. In other words you need to market a product
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Porter generic strategies Michael Porter described three types of strategy to achieve/maintain competitive advantage in his 1980 work Competitive strategy: techniques for analysing industries and competitors. (CS:TAIC) These generic strategies are based on two dimensions: market scope + core competency with two competencies being the most important: product differentiation/product cost. [pic] Porter (1980) stressed that failure to adopt single strategy of differentiation or low cost results in
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In General Motor (GM) in relations with their external environment‚ there are many elements in which (GM) as a company will have no control over when conducting it business. In the “Five Forces Model” ‚ Michael Porter provide an suggestion and analysis regarding the forces which companies like (GM) will have no control over such as: 1. Who their immediate rivals will be‚ 2. Who the potential entrants are‚ 3. their customers‚ 4. suppliers and 5. Substitute products that will be purchased over (GM)
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read was‚ What is Strategy? By Michael Porter. In this article Porter talks about the abilities to set objectives‚ facilitate resources and the ability to target the right customers. Porter goes onto talk about operational efficiency. He says that operational efficiency is basically preforming similar tasks better than your rivals in the market. He emphases being different than your rival‚ don’t try to be better and always out do them‚ be different and unique. Porter stresses that to have a competitive
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