Competitive Positioning Based View Commerce Essay


Leila A. Halawi, Jay E. Aronson and Richard V. McCarthy (2003) states that not only in a new millennium, but also in a new era: the knowledge era. Sustainable competitive advantage is dependent on building and exploiting core competencies with the purpose to earn long term profit as well as to satisfied customer need. The resource-based view (RBV) of the firm defines a strategic asset as one that is rare, valuable, imperfectly imitable and non-substitutable. Knowledge is seen as a strategic asset with the potential to be a source of competitive advantage for an organization. According to porter (1999) explain that we can make tough choices about what we have to do and not do to make competitive advantage. It means for successful corporate activities organisation need to know in the competitive environment how to use sustainable competitive advantage. He also defines that the capability towards earn profits on investment constantly higher than the standard intended for the industry (Porter, 1985).this line explain that for the successful organisation we must adapt sustainable competitive advantage and it shows the result in strategic assets which is the most advantageous thing of the RBV method. This was developed to explain how any organisation reach sustainable competitive advantages.( Barney, 1991; Wernerfelt, 1984, Hoopes, Madsen and Walker, 2003). Sustainable competitive advantages are the task of organisational governance, industry testing and organisational effects in the form of strategies and advantages. However, Collis (1994) recommended about advantages in marketplace that a firm can compete away by high-order capability by placing importance upon management as the strategic asset, that are simultaneously valuable, rare, difficult or costly to imitate, and non-substitutable, driving towards adaptability and ability of identifying opportunities (Connor, 2002).

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In the articals of (JOSEPH T MAHONEY; RAJENDRAN PANDIAN J 1986 -1996)Application of principle of resource based view in any organizational management provides the accurate & right direction to the management strategy formation. In which the strategy planners counts market segments, compititors strenghs & weaknesses, availability of both tangible & non-tangible resources,future needs in terms of product & services.Resource based view support to creat a standard framework & conversation between company's goal & its management.

"The resource based approach frame in a dynamic context.Schumpeterian compitions involves carrying out new combination including new method of production as well as organitonal innovation (Lwai 1984)".

I am completely agree with above statement , it precisely speaks about the factors used as a strength on the basis of resourced based view. Certainly, the above combination method of innovation and talent improves marketing policies of company as well as provide better solutions. Thinking beyond the compitetors policies makes this principle of resource based view as worth application.

"As a means of achieving the goals of sustain competitive advantage (Ghemawat 1986), penroe(1959) ,following Shumpeter(1950), view the competitive process as dynamic involving uncertainty ,struggle , and disequilibriam".

Example of isolating mechanism (both efficiency and market power) derived from resource based theory, mainstream strategy research, organizational research and economy and the industrial organization literation.

A Resource-based View of the Firm


(Strategic Management Journal (pre-1986); Apr-Jun 1984; 5, 2; ABI/INFORM Global)

From the firm resources and production are the different side of same coin. The present report about the company clearly display that the decisions made after every resource based view are considered mainly its resources rather than product. After valuation of all resources, it was found that the company look over resources which are profitable, high - yielding and easily accessible among the plenty of resources. Overall view says that every major resource take care of other minor resources machine capacity, customer loyalty, production experience, technological leads.

competitive positioning based view or I/O-

According to theory of the competitive organisation (I/O) model, the exterior environment, of general industry and competitor has a major crash on the firm's strategies. Comparing this background. It can be found that industry background has a great crash, which by use of Porter's five forces model can be manipulate in the firm's favour by evaluating watchfully the opportunity and fear within that industry background. Certain industry has certain peculiarities on the origin of which strategies are been strong-minded. Buller, beck-dudley & McEvoy(1990) recommended in their articles that diverse human practices advance uses diverse strategies like a high employee input ,mix of character and cluster , in house equity plunder are be liable towards use of isolation strategy while narrow job coursework, fixed stable job explanation, external equity plunder are more likely towards cost leadership ,but rising the struggle in the market has created a cost control in the course of economies of scale. In the today's cut-throat world it is not the first cause to look for the customer require ,but also has to appear to their supplier which can suggest chance to create a cut-throat positioning in particular industry or organisation .it has been described by Reck and long (1998) with the aid of four progressive stages (indigestive , supportive, passive, and independent) which make clear that level connection to firm's aggressive advantage varies appreciably ,

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In Geoffrey r.(1995) article states that market allow finer grained product measurement of competitive condition than is possible useing conventional approaches. This approaches are as follows which are based on it's natural market approach is derived from the industrial organisation economics literature and the second, is on enactment approach, is connected with the open systems on viewpoint of organisation. As well as the weakness of the competitive positioning is that they attempt to sell their similar products is not sufficient to identify them as competitors, but sometimes some products having different kind of a demand in the different geographical areas, for e.g. Colget and Pepsodent , colget has a huge demand in rural market in India on the other hand pesodent has a huge demand in urban market. In the competitive environment, the market or industry ignore the customer side, their assumption is that market is national in extent and demand characteristics are same across the entire firm in the category. However in some cases market is not same or uniform. "the geographical extent of market has been a prominent issue in studies and discussion of antitrust issues surrounding mergers in the banking"(Jackson 1992) , health care (federal trade commission,1985),energy provision (duchesneau ,1975) among the areas in some other industries such as banking and health care uniformity in product offering is based on the geographical which is primary determinant of market boundries ,therefore in the geographical extension is the key to measures the organisation competitive environment which is consider as a strength of the competitive positioning . the main weakness of the competitive positioning in other industries the use of unspoken national boundaries for markets are confirm or fixed .on that Thomas and Venkatraman (1988), for example, argue for expanding the boundaries for the geographical scope in industry definition to allow for the fact that competition can be must go beyond the with the multinational or national boundaries. In this Thomas and Venkatraman wants to point out that if competition will be on the large scale then the new organisation can learn new thing from the competitors while this competitor can be harmful for the new or small scale industries.

Howard Thomas and Alex Wilson stated in the their articles that Business schools are divisive organizations: the title of Khurana's recent book From Higher Aims to Hired Hands (2007) shows the insecure positioning of business

schools in the modern university. These business schools are always interested in management research and management education about the new strategies and so on, but it is too difficult to handle because of importance and cooperation

(Pettigrew, 1997).This schools are having better impact as well as point out the strength which will really helpful discipline-based scholarship shows that contribution for the knowledge of expanding management ,practice explain that trying to improve the practice of the management level of the people as well as the managers, academic and learning research involved mechanisms and awareness (AACSB, 2007) ,on the other hand there are some weakness which create a problem in management has a "cross-cutting ,multi- disciplinary nature (Pfeffer and

Fong, 2002)

According to one case study of Yugo - a cheap motor car cost of USD$3990.This car introduced in 1986 at price of less than USD44000 in USA. That time they made a good sell in the USA market but after sometime people knew that this car made up of a low quality material, poor performance which made a worst car of the year in all the car history. This case study shows that in competitive positioning we must look at the consumers need and wants within the company boundaries (Prof. Dr. Bernd Venohr 2007)

According to one case study of Yugo - a cheap motor car cost of USD$3990.This car introduced in 1986 at price of less than USD44000 in USA. That time they made a good sell in the USA market but after sometime people knew that this car made up of a low quality material, poor performance which made a worst car of the year in all the car history. This case study shows that in competitive positioning we must look at the consumers need and wants within the company boundaries (Prof. Dr. Bernd Venohr 2007)

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Above all applies the concept (i.g, resource based view and competitive positioning) defines the differences and similarities of themes which are as follows.

Common things about the RBV and competitive positioning strategies

1)One roof shopping and wide selection in this part they try to put all kind of a material under one out late or on the website where consumer can purchase .such as, wall mart

2)Technology in this part so many company trying to give a new technical things to their consumer but some are fail on the other hand some will got the consumers responses such as Sony laptop compare to Compaq laptop

3)Quality in this part company try to give best quality product to the consumer but some are produce worst quality product which consumer will not prefer ,such as Toyota and Maruti car company

4)Spare parts availability in this part some automobile company try to make sure that their spare parts available easily to the consumer but some company can not reach to their consumer. Such as, Toyota and Maruti (automobile company).

Difference between RBV and competitive positioning strategies

Prestige- in this part some brand are having their own identity in the market or they have a some different kind of producing method which no other company can try to follow. Such as Rolex watches

Reliability-in case of any trustworthy and reliable company the buyer will render the services of that company even in the case of newly launch product, instead of tracking the particulars of it's new product.

Better service-in this part company or an organisation try to give different services or a different complimentary things so they can attract more consumer .such as Ritz-Carlton and FedEx

Performance and engineering design- in this part company or an organisation produces a new thing which will not available in the market with the help of this thing they can try to capture the market. such as Mercedes-Benz and BMW

` Above all the over view of this essay shows that in the 21st century for any organisation who wants to make profit they must be use RBV method . Accorading to Ziff Davis Media Inc.2008 one author suggested that in Sony is the producing best lcd HD DVD comparreing Thoshiba DVD which are not so good in front of the Sony for this the author explain with the help of the former heavyweight champion Muhammad Ali ,he was great player in his time but that time he use the different strategies which were new one.when he fought he tried to disturb or trying to distract his opponent and at the end he overcome on his opponent .Sony also doing the same thing that they were distract their opponent or competitor which help them to overcome or win the market .in 21st century developed countries people are not price oriented but they are quality oriented so it's useful for the company like Sony who has a good quality product.( PC Magazine. New York: May 2008. Vol. 27, Iss. 6 )

After having a view on the whole scenario of the I/O model and RBV model, there is a wide difference between their processes as I/O model is outside-in while RBV model is inside-out process. The another difference can be viewed is that RBV model is based upon resources and capability of the firm while I/O model is based upon outside actions been performed by the firm stakeholder, in a way can be said as RBV is more towards absolute approach while I/O is more of comparative approach. I/O model uses moral stakeholder approach while RBV strategic stakeholders approach. Even after such difference between the two models, in today' competitive environment the concept of using both model to have sustainability competitive advantage is followed due to important similarity been found between the models which help them to successfully implement the plan strategy.