Why Companies Lose Competitive Advantages Marketing Essay
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This assignment is the part of the requirement for the partial fulfillment of the course â€¦..COde need to be mention'Research Design'. The purpose of this assignment is to conduct an appropriate research methodology keeping in mind different worldviews, define strategy of inquiry in order to investigate and identify the reasons i.e., why a company would lose its competitive advantage among its competitors and what countermeasure can be taken to sustain its competitiveness? This report also highlights the research methodology for this particular problem considering mixed method approach focusing on data collection techniques and data analysis. Furthermore, it presents the factors, which have an influence on competitive advantage for a company keeping both user's or customer's and company perspective. We consider this methodology an appropriate for such type of problem and are hopeful that it will provide some concrete results in form of recommendation or outcomes.
In today's era market is growing with an unbelievable advancement. Globalization, technology development and innovation revolutionized the entire structure of market. Such progression leads companies into intense competition among different firms within the same industry. Technology evaluation compelled companies to strive for many companies have pursued their existence and thus novel inventions. Change in market gave birth to new customs and traditions put the firms and companies into struggling dilemma. The successful factors for companies previously are much more diverse in contrast with current market transaction. The winning edge of any companies is its continuous learning knowledge, potency in science and technology, entrepreneurship and innovation. Competition among firms and industries is a continuous process and firms leading the industry in their domain contain some uniqueness that discerns it from rivalries. Companies who religiously follow market trends survive lucratively in the business environment.
Competitive advantage is one of the factors, which holds firms within same industry at leading edge. However, discussed earlier companies facing tremendous problems to retain their uniqueness due to persistent technological advancement and innovation. In this research I will illuminate on competitive advantage, their factor and how to cope with it.
Peter reported that company is loosing their competitive advantage in market, and significant measure needs to be taken to overcome this problem. For any company to survive in an industry its essential to gain some distinguishes in an industry. If companies lose their competitive advantages, they may encounter serious consequences if not tackle intelligently.
"A competitive advantage is an advantage over competitors gained by offering consumers greater value, either by means of lower prices or by providing greater benefits and service that justifies higher prices. " 
How Companies Formulate their Strategies in Order To Gain Competitive Advantage?
According to Michael Porter there are four business strategies that could be adopted in order to gain competitive edge in industry. These are summarized in below figure: 
Strategy Differentiation: It is associated with premium price, which reflects high production cost and extra features added in a product. Example can be Mercedes cars.
Strategy cost Leadership: companies who do business on a large scale, where the product is of standard type and less differentiation is involved, usually follow it. This theory says to minimize production cost. Low cost leader will focus on discounts to maximize its sales. Examples are Dell computers and Nissan motors etc.
Strategy Differentiation Focus: In this business try to focus either on one or few numbers of target market segments. The objective is to analyze the needs and wants of customers, which have not been identified by the competitors who provide, generalize product. Example can be any successful niche businesses.
Strategy Cost Focus: In such type businesses try to gain advantage on basic products, providing low cost, the feature of the product would be similar to the high price in the market and also would be acceptable to large extent of consumers, so in short to penetrate in the market on low price basis. Example can be retailers featuring their own label or discounted label pricing.
Why Companies Lose Competitive Advantages?
There is no specific standard provided to figure out such reasons, continuous swift in technological development, innovations can be considered focal motives. Besides these giant factors there are some common basis on which company loses its competitive advantages in market. 
Changes in Customer Preferences: Companies usually starts ignoring the importance of customers. Significance of customer value should be on top priority. A customer drifting away is very easy due to intense competition exists and companies endeavors should be persistent in this continuum.
Challenges from Competitors: Competitors constantly try to break the ice by introducing new and different products in order to capture and divert consumers from the leading firm.
Internal Changes: Changes occurred within an organization also leads to losing competitive advantage. For example new CEO may bring alteration in business strategies and change the direction, which may create ambiguity within employees, and hence drastic results may encounter.
Methodology is the plan or strategy that links method to outcomes while methods is the technique or procedure to be used in order to reach to the goal/get the outcomes of the research. There are four different philosophical worldview or school of thoughts about knowledge claim but selecting an appropriate methodology is the critical and building step good research. [cresswell &Commonwealth]It is also evident from the literature that understanding nature of a problem is important in a way that it define the broader worldview under which it exist and also clarify the strategy of inquiry and method or tool for conducting research. [cresswell] In this particular study, our problem comes under pragmatic worldview and the reason for this is shown in the below section.
Considering the problem statement "Peter argue that the company is losing its competitive advantage and that we need to do something" seems to be the outcome of actions, situation or consequences, which mainly is the concern of pragmatic philosophy. According to [cresswell], in pragmatic worldview the problem is more important than a method and researcher focus on all approaches to understand the problem. The main concern in this philosophy is with application- "what works" and on solution to the problem.
Strategy of Inquiry
The strategy of inquiry in this study will use a mixed method approach considering both qualitative and quantitative strategies focusing on "what" and "How". Further in a sequential order by conducting quantitative study followed by qualitative study. According to [cresswell] the researcher in pragmatic worldview is free to choose whatever technique, approach and method are suitable to his/her study. In this study the main focus will be on exploring the "what" part of our problem i.e., what are the factors affects the competitive advantage of a company. The data collection in this phase will be carried out using survey with the help of questionnaire among the customers or users representing a sample of population. Both open and close-ended questionnaire will be used for data collection from users/customer. It will result in identifying the reason why user are not satisfied with the company's services, what other competitors provide better than comparing to selected company, what are the end user requirements and their ranking about different attributes like cost, service, technical supports, reliability etc.
The questionnaire would be user-centric in order to identify user's preferences and their priorities for different requirements using ranking scale 1-5 where 1 means lowest priority and 5 means the highest priority. The purpose of this user requirement specific questionnaire is to identify the different aspect of services to which user is more critical and sensitive and for which they can do compromises.
Structure of User Requirement's Specific Questionnaire
No. of Respondent
Structure of User Requirement's Specific Questionnaire
The second questionnaire is again from the same sample (using user presence/requirements but in comparison to other competitors) but this is more specific to the services which other competitor in market provide them better than the selected company. In other words, the ranking of services from Bad to Excellent by user to the selected company services in comparison to other companies services in the market. The purpose of this questionnaire is to identify which part of services the selected company is lacking off, or which services other competitor provides better to the customer than the selected company.
No. of Respondent
In the second phase of our research, we would like to know the organizational influence on company competitiveness such as change of role, change in team members etc. For this purpose, unstructured interviews will be conducted with the CEO and Manager of a company. These interviews will assist researcher in extracting data, which would provide way to discover the problem, and hence solutions would be formalized accordingly. The researcher should emphasize to construct questions for interview in a way, which will help in extracting the core problem. The focus on questions should be related with quality control, customer support, cost control, change of role, employee's incompetence, etc during interview to dig out required information.
After data collection stage analysis of the collected data is required. In this stage all the outcomes should be analyzed gathered from the survey (questionnaire) conducted from the users (external) and interview conducted from CEO and manager of the company (internal). By analyzing we mean to compare which areas are sensitive and which factors are critical in both scenarios, which lead company towards loosing their competitive advantage. Next step we could do with to converge the factors, which have same level of sensitivity or criticality, involved from external and internal sources. These factors should be analyzed thoroughly and on that basis solution should be presented.
The recommendations should be according to the research outcomes. The general view can be that companies should focus on their customers; they should constantly update themselves regarding customer's preferences. They should build and keep strong ties with customers in order to retain their users. It's very important to know the needs and wants of your customers. Many companies are leaders on such basis as they consider customers their prior strategy. Companies should also abreast themselves about their competitors activities, they should have always clue what their competitors can come up and should formulate their strategy in a way that competitors would feel difficult to take competitive advantage away from the leading firm within industry. (not completedâ€¦..)
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