The Sustainable Competitive Advantage In Hospital Industry Marketing Essay

Competitive Advantage means when the business is all about selling high quality goods at high prices to gain this advantage. It means to create brand Loyalty and selling brands which are completely unique products. Brand is a unique name of the product that distinguishes it from other brands which make people brand Loyal to it and they keep on buying things of that particular brand only. It helps in increasing sales and uplifting profit and Economies of Scale can also be achieved. The more the competition there is the more likely it is that prices will b fixed similar to those fixed by other rival businesses. Competitive advantage helps in creating powerful image and perception in the minds of consumer either negative or positive. It means the business has all the unique attributes and unique identity which outperform its competitors. it means business is having Information networks and access to natural resources, high market growth and high market share that are STAR products, high skilled labor force and good amount of resources. To bring about successful business change using information technology, healthcare organizations should avoid simply investing in technology that improves performance of traditional functions. Rather, organizations should ensure that technology works in concert with meaningful changes in organizational functions and processes (Kenneth and Deborah, 1990).

Sustainable competitive advantage is a main point of your corporate strategy. It allows improving and maintaining your position in the market. It firstly helps the business in making of corporate aims which are very long term goals that a business hopes to achieve (Boulding, William and Ajay, 1993).

Sustainable advantage helps a firm to set out best in a segment group. It is unique in everything that is valued by customers and buyers. Hospital industry is a main source for health and care. They are the house for the sick people who are homeless, poor and insane. It basically entails as a security for the nation and that security and safety is all about health which is necessary for the survival. Just because of advancement in science and technology the hospitals are able to provide people with good and best medical facilities. There are professional health care workers who save our precious life. Hospitals provide inpatient health services, and many of these services can be provided only with specialized facilities and equipment. Services include medical care, diagnostic services, nursing care and many more. They also provide good treatment for sugar patients, cancer and mentally ill people. Hospitals provide inpatient health services, and many of these services can be provided only with specialized facilities and equipment. Hospital is a need of around billion of people across the world. Due to the latest equipments and advancement in technology the living standard has improved (Robinson and William 1988).

In Pakistan, Professional occupations, such as physicians and surgeons, dentists, registered nurses, social workers, and physical therapists, usually require at least a bachelor’s degree in a specialized field or higher education in a specific health field, although registered nurses also may enter through associate degree or diploma programs. Employment in home healthcare and nursing and residential care is increasing as life expectancies rising and families are less able to control elder people so they rely on long term care facilities. Earnings vary not only by type of establishment and occupation, but also by size; salaries tend to be higher in larger hospitals and group practices. Geographic location also can affect earnings. Healthcare workers generally receive standard benefits, such as health insurance, paid vacation and sick leave, and pension plans. However, benefits can vary greatly by occupation and by employer. Doctors perform night duties and work overtime just to improve the quality of life of millions of people. Most advanced and large popular and good hospitals in Karachi are AGA KAHN, Liaquat national hospital, A.O Clinic and many more.

Research Hypothesis

H1: Distinctive skills play an important role in attaining sustainable competitive advantage.

H2: Product, process and managerial skills play an important role in attaining sustainable competitive advantage.

H3: Distinctive skills play an important role in attaining sustainable competitive advantage.

H4: Functional skills plays an important role in attaining sustainable competitive advantage

Statement of the Problem

To analyze the factors on achieving of Sustainable Competitive Advantage

CHAPTER 2

LITERATURE REVIEW

The term competitive advantage is the abilities to natural resources, high market growth and high market share that are STAR products, high skilled labor force and good amount of resources. The term competitive advantage is the ability gained through attributes and resources to perform at a higher level than others in the same industry or market. It helps in accomplishing goals and uplifting the name of entire organization (Darby and Kari 1973).

 Sustainable competitive advantage is a main point of your corporate strategy. It allows improving and maintaining your position in the market. It firstly helps the business in making of corporate aims which are very long term goals that a business hopes to achieve. They provide a framework within which the strategies or plans of the business can be drawn up. sustainable competitive advantage is gained by developing new markets for existing product Like export markets, new uses for existing products and re launches involving new packaging and advertising. When a business can create Synergy it will automatically gain sustainable competitive advantage as it means when two firms are integrated the argument is that the bigger firm created in this way will be more effective, efficient and profitable than the two separate companies. For sustainable competitive advantage the leadership is an important part of being a successful manager. Leadership is the necessary condition for long-term competitiveness. This is the advantage that you and your company have over your competitors in the same marketplace – the unique and special benefits that no one else can give your customer (Boulding, William and Ajay, 1993).

Those activities and things that a company can do better than its competitor’s yields long term advantages known as Sustainable advantage. It is the advantage that cannot easily be copied or cheated. Sustainable advantage means creating offensive and defensive strategy. An offensive strategy will lead the rest of industry with innovative products. The aim of this business is to gain market share. And defensive strategy is an attempt to learn from initial innovators’ mistakes and weaknesses and it will help to improve on the original product or develop slightly different types of goods which might appeal to other market segments (Moorman and Rohit 1992).

The Sustainable Competitive Advantage in hospital industry can be discussed as the type of business helps not only in maintaining health of the company but also for the health of its customers and patients. It helps in improving the quality of life of both. If the hospital industry successfully provides good treatment for sugar, cancer, blood, mentally retarded people and it is famous and nice in the eyes of the customers so as in the eyes of patients. It means it is unique in its attributes so it will automatically gain sustainable competitive advantage in comparison to other hospitals in a city. If the skills and qualifications of labor that is doctors and nurses are good. If they are well educated and qualified and through their strategic actions related to the capabilities and relationships they develop so they can gain competitive advantage easily and there pay will get better and salaries will b high then of course. Competitive advantage may change over time as new organizations enter the market and copy the competitive advantage of industry leaders. Organizations must constantly look for new ways to remain competitive in an ever changing market (Barney, 1991).

It can create improvements in health care and hospital industry. Emerging healthcare information networks will be able to take advantage of new public network infrastructure investments that will greatly enhance the ability to communicate and manage information. If patients that is customers are provided with good working conditions and managed-care environment and they recover soon and in return hospital will gain competitive advantage (Black and Boal, 1994).

When a firm sustains profits that exceed the average for its industry then only the firm is said to possess a competitive base over its rivals. It occurs when a business is able to sell the same product at lower cost than competitors. It is known as cost advantage. Competitive advantage helps the business to create superior value for its customers. The resources should be great in supply as they are the assets for the business. Resources can be patents and trademarks, brand equity and reputation of firm. This advantage is not necessarily long lasting and permanent because other firms will try to copy some ideas and rules. For sustainable advantage to last long it should be Valuable to consumers and it should also be rare which means it is not easily obtained then it should be Inimitable which means it cannot be easily imitated or copied by competitors and Non-substitutable so that consumers cannot or will not substitute another product or attribute for the one providing the firm with competitive advantage (Douglas, 2001).

Successful hospital workers and managers know all the ways to create unique advantage. If they understand the situation properly and treats patients like their blood relatives and provides them comfort, care, safety and security so they will succeed and uplift the name of hospital gaining Sustainable Competitive Advantage (Judge, 1994).

The environment and atmosphere should be good and equipments should keep on changing. The simple thing is that hospitals should be updated with new technologies coming into the market and it should apply and try new ways that are different from other hospitals so it will give them the good competitive advantage over their competitors and that particular hospital will then lead. Either it’s the hospital industry or any other organization the Sustainable competitive advantage can only be gained if it’s truly unique in its goods and services and attributes, name and equipments so it will be successful. the only things is you should have a different approach and you should be different then your rival only then you will peruse many advantages and it’s great to be in competition as it improves quality and make the business and organization more efficient in its operations. If a suit maker bring about range of different colors and new designs to the dress to make it look beautiful wont attract customers. Variety would not become a competitive advantage, and would be a waste of resources. A difference may be worth developing and promoting. A competitive advantage can make or break a firm, so it is crucial that all managers are familiar with competitive advantages and how to create, maintain, and benefit from them (McGahan and Porter, 1997).

Competitive advantage is good for any kind of organization like it will lead to towards brand loyalty, people will be more interested in your brand rather than of any other and even you can charge the premium amounts and in hospital industries having competitive edge in a sustainable ways means that it can make the whole organization a successful one. Sustainable competitive advantage assists hospitals to build up their goodwill in the market and then make it long lasting in the eyes of customers. Hospital industries can have all the competitive edge by providing extra ordinary care toward their patients, usage of high quality and specialized machines, doctors who will be ready to treat patients at any time of day or night. Great and lasting achievement in the hospitality industry requires a competitive gain that can be leveraged to send better-quality outcome. This course focuses on the on the whole procedure of creating worth within a firm and how managers can make sustainable competitive advantage by utilizing key interior land and capital and capabilities (Robinson and Luft, 1988).

Thriving hospitality managers and leaders have a systematic understanding of the procedure of creating importance and the part of the value plan in developing the top strategy to generate an exclusive, sustainable competitive advantage. This course develops the skills essential to appraise strategic alternatives such as expenditure advantage and differentiation strategies, as well as the strategies of competitors, where they engender importance, and their positioning. Participants study to evaluate business-level strategies intended to make significance at the property level; and commercial strategies, which covenant with the premeditated way of the firm, the markets in which it will struggle, and managing a collection of properties. Participants build up the skills to appraise the capability of a variety of strategic alternatives to make worth and competitive advantage as well as how to execute value-chain and opponent analyses to update strategic decision-making (Ambler and Kokkinaki, 1997).

New industries already have taken benefit of information technology to enclose costs and get better competitiveness. In the pecuniary services industry, for example, the cash administration account introduced in the early 1980s used information technology to shape the lines of banking and brokerage, consequential in sustained competitive gain for the financial services association that produce this product. In the airline industry, information technology used in reservation systems has helped certain airlines grow competitive advantage. Opposition breeds modernism, but historically the healthcare industry has had petite true market rivalry. As a result, improvement has been partial to medical instruments, diagnostic tools, and other technologies that could be reimbursed beneath the fee-for-service system’s cost-plus pricing formation (George and Robin 1988).

To get about victorious business change using information technology, healthcare organizations should shun simply investing in technology that improves act of traditional functions. Rather, organizations should make sure that technology works in gig with meaningful changes in organizational functions and procedures. Information networks are the premeditated device by which healthcare system can use recent information technology to make meaningful improvements in business functions. These networks could have a consequence on healthcare release alike to the upshot of automated teller appliance networks on the financial services industry. The operation volume of healthcare information networks could estimated that of highly complicated electronic clearing-house networks that hold billions of financial transactions every day (Kerin, Roger, and Robert 1992).

Up and coming healthcare information networks will be easily able to take benefit of new public network road and rail networks investments that will greatly improve the capability to correspond and direct information. For example, one big California-based telecommunications organization is investing $16 billion over the after that seven years in string optic networks that will arrive every business and residence in the state. Such a faultless communication network be supposed to able to procedure all forms of healthcare information, from eligibility confirmation to the most difficult multimedia programming, allowing information to be transmitted almost anywhere at any time. On a worldwide basis, in the next decade more money will be plunk into the world’s information network infrastructure than in all the years joint since the discovery of the telephone (Darby and Kari 1973).

An extremely competitive managed-care surroundings and a new information network infrastructure will rouse formation of new forms of electronic commerce. Fueled by the majority basic needs of rivalry for the most necessary market information, the fresh healthcare information networks will need to attach all participants within the electronic trading group of people, including buyers, providers, payables, and patients. This junction of desires will drive formation of patient-centered information networks that will hold up horizontal and vertical information mixing. To complete the desires of the healthcare delivery system, these fresh patient-centered networks must spotlight on providing right access to information about patient/provider relations at all points within the healthcare delivery system. The networks must allow proper routing of financial data; data about cost, scientific outcomes, and patient health requirements; and all mechanism of the medical record, including metaphors such as X-rays. In addition, such networks must make easy health safeguarding through their skill to deliver educational information, and they have to able to sustain home health telemetry applications (Barney, 1991).

Sustainable competitive advantage is a planned mantra based on faith from knowledge in other industries.  Any sustainable competitive advantage in sensitive health care depends on the capability of medical users to create a differentiation of software with internal resources. External terrorization can be from regulatory or officially permitted mandates that set up necessities that are not favorable to business differentiation.  Internal threats in EMR systems are associated with systemic IT deficiency or inconsistencies in the manipulation of electronic medical records. While competitive advantage in physical condition rarely resembles that of competition in other industries, a disagreement can be made that the sustainable competitive advantage can be attained by modernization and favorable reception of the EMR technology by particularized hospital clinical units.  If the essence of the equipment is the same across an industry, the useful advantage comes from minimizing domestic risks and leveraging ecological opportunities (Black and Boal, 1994).

There is reason to consider, though, that the direct cost and opportunity cost leverage will be the pivot for hospitals to differentiate themselves from their local and provincial competition.  The growing use of internet-based health care extreme surveying sites will provide health cares and clinical practices the opportunity to convert their internally developed competitive advantages to quantifiable and comprehensible competitive benefit. A firm is said to have a perpetual competitive advantage when it is implementing a profit creating strategy that is not simultaneously being implemented by any other challenger.  This leaves us to beseech the question about how EMR will create industry-wide competition when everyone is mandated to use the same or comparable technology (Douglas, 2001).

Health care providers that develop and implement these systems and processes around an EMR software application would create that imitable component that would lead to a sustainable competitive advantage. Value chain scrutiny is a powerful tool for managers to identify the key activities within the firm which form the value chain for that company, and have the capability of a sustainable competitive advantage for a company. Competitive advantage of an organization lies in its ability to perform essential activities along the value sequence better than its competitors (Robinson, and Luft, 1988).

When the system is managed carefully, the linkages can be a vital source of competitive advantage. The value chain scrutiny essentially entails the connection of two areas. The value chain links the value of the organizations’ activities with its main functional parts and the evaluation of the contribution of each part in the overall added value of the business is made. Taking value chain analysis into consideration, the company is split into leading and support activities. Competitive advantage theory suggests that states and businesses should pursue policies that create high-quality goods to sell at high prices in the market. Competitive advantage rests on the impression that cheap labor is everywhere and natural resources are not necessary for a good economy. The other theory, comparative advantage can lead countries to concentrate in exporting major goods and raw materials that trap countries in economies due to terms of trade. Competitive advantage attempts to correct for this issue by stressing maximizing scale economies in goods services that earn finest prices (Kerin and Robert 1992).

Competitive advantage occurs when an organization acquires or develops an attribute or combination of attributes that allows it to do better than its competitors. These attributes can consist of access to natural assets, such as high grade ores or easy on the pocket power, or access to highly trained and skilled personnel human resources. New technologies such as robotics and IT either included as a part of the product, or to assist making it. Information technology has become such a prominent part of the modern business world that it can also contribute to competitive advantage by outperforming competitors with regard to internet presence. From the very beginning, the central problem of information transmittal, leading to the rise of middle-men in the marketplace, has been a important obstruction in gaining competitive advantage. By using the internet as the middle-man, the supplier of information to the final consumer, businesses can gain a competitive advantage through creation of an effective website, which in the past required extensive effort finding the right middle-man and cultivating the relationship (Dranove and Shanley 1992).

The company would not have been so diversified without the dedication, and commitment of its founder Richard Branson. He put a lot of efforts to expand in almost every area and make it as a well known company across the globe. Today, Virgin is rendering its services in Asia, Europe, North America, Africa, and Australia accompanied by a huge product line i.e. Airline, cola, cell phones, bridal wear, retail and technology, financial services, automobiles, music, hotels and garments etc.

The reason for Virgin’s success is the respect and value for its human resources. According to its founder our employees comes first, then the customers, and then the shareholders because employees has the power to satisfy and make the customers happy by producing quality products and ultimately with the happiness of customers, all the shareholders will be delighted. With this belief, the company has gained the loyalty of its employees. Virgin has derived its employees with a slogan “Our People come first”.

Critical Analysis of Virgin Organizational Culture

Culture in organizations formulates a mechanism that connects the employees with their organization. Culture communicates the leader’s expectations or messages regarding the workplace. All the leaders critically analyze the culture and mold it according to the existing needs and attributes in order to achieve the strategic objectives and goals.

The existing culture in any organization is difficult to modify but this could be done through the leaders because they are the only authority who can influence the employees by being a role model and through effective communication. The culture at Virgin is based on such characteristics that formulate an ideal culture in perspective of its employees. The culture at virgin is based on following forms that best illustrates its culture;

Ritual

At Virgin the standardized techniques were crafted and executed so that the employees could learn and manage the anxieties at various circumstances. Richard Branson himself is the best example for all the employees concerning the ways he managed Virgin in various situations i.e. in order to save the company due to economical downturn he sold his music group for $170 million. In addition, the way he jumped into a stock market is the best ritual that he had crafted for employees.

Saga

The leaders of Virgin are the best example of this cultural form because they have proved themselves as the role models for the rest of employees. The unique accomplishments of Richard Branson have derived the company towards the success. In heroic terms he has motivated his employees to work to achieve excellence and because of such terms Virgin people ensures that all the company’s core values are achieved.

Symbol

An innovative technique / tool implemented at Virgin is “Internal Brand Alignment”. This is the tool that has served as vehicle for communicating that employees are greatest assets for Virgin. This is the best practice that has formed a remarkable culture at virgin and has made it the best place to work at. Moreover, this practice has served as the tool to motivate the employees and consider them as the external customers. In addition, this alignment was used to persuade employees to behave in certain ways.