Sustainable competitive advantage provides leverage over competitors through the use of company’s attributes, assets, or skills that are difficult to copy, much less exceed (Faulkenberry, n.d.). If the company has no sustainable competitive advantage, it may fail to recover from a crisis or survive the increased competition. ‘Apple’ may serve as the perfect example of a company using a range of sustainable competitive advantages.
To start with, the brand is recognizable all over the world, the company is known for using innovative and cutting-edge technologies. Furthermore, its products are praised for durability and elegance. Finally, customers using Apple products virtually get addicted to them, and switching to other brands, or other software is out of the question for most of them. By using an array of sustainable competitive advantages, Apple maintains its long-lasting leverage of numerous competitors.
Companies constantly need to analyze their competitors, identify the trends, be on the look for changes in technological or social conditions. Companies can use external scanning as a tool helping them to better respond to the volatile market rules. Samsung’s efforts at external scanning seem to be successful and consistent. The Korean giant manages to stay afloat amid increased competition by effectively responding to the competition.
It appears that Samsung’s response to the competition is proactive, for the sake of example, Samsung manages to incorporate the features in its upmarket smartphones that appear months later in competitor’s products. As an example, Samsung released its state-of-the-art Galaxy S6 beating new iPhones by one month ahead (Lee, 2015). Furthermore, Samsung is placing a lot of effort into Research and Development so that all of its products remain relevant on the market. Samsung’s goals and strategies are aligned with the decisions which positively influence the market performance. The company is making big efforts to outplay the competitors and roll out its cutting-edge products when others are only planning to do so.
There are plenty of organizations which have both vision and mission statement, although IKEA, a Swedish furniture company, is a perfect example, among many others. Ikea’s mission statement which is to create a better everyday life for many people presents the customer with an intriguing contradiction (Kolowich, 2015). Instead of promising elegant and affordable furniture, they shifted their mission towards making a commitment to improving customer’s life on a daily-basis. The company’s main objectives are to provide customers with affordable and well-designed furniture.
The main strength in Ikea’s mission statement is that it departs from the concept of furniture and touches upon customer’s quality of life. Interestingly, the concept of affordability and enhanced design is still in the customers’ minds. Aside from affordability, Ikea is praised for its innovative design, and all the furniture products are distinguished from its competitors. The company’s vision also lies in diversification; it went way beyond furniture, and now produces various products which may be used for versatile purposes.
The need for a competitive advantage is essential for any business in the field of strategic management. Competitive advantage becomes increasingly important amid fierce competition and similar companies offering the same products. Several factors may play into adding advantages to the company, including product quality, low price, outstanding customer service, etc. Samsung, a Korean tech company, may serve as the example of the company that has successfully used competitive advantage amid the global challenges and increased competition. Samsung continues to follow the path of innovation and manages to stay afloat despite increasing competition.
Samsung’s strategy for innovation helps it maintain its competitive advantage; it is constantly raising the bar for technology, releasing products that are durable and elegant. One of the advantages that Samsung uses most successfully is product range diversification. The company’s willingness to experiment pushes the technology forward and adds to strategic advantages. Samsung’s competitive advantage hinges mainly on its Value Innovation Program with 6 design labs employing 450 specialists who are constantly considering the consumers’ needs (Value chain and competitive advantage of Samsung, 2012). Samsung spends more $6 billion on research each year, and this is an enormous figure that allows the company to foster its competitive advantage.
Toyota’s website mentions corporate governance and the company’s stock overview (2015) shows “the number of shares issued totaling 3,417,997,492 with 496,859 shareholders” (para. 1). Toyota is known for corporate governance with reports published regularly outlining the company’s mission, major shareholders’ input, and overall performance. In the corporate governance policy outline (2011), Toyota representatives shared that “it is essential that we achieve long-term and stable growth by building positive relationships with all stakeholders, including shareholders and customers as well as business partners” (para. 1).
From the corporate governance policy, it may be assumed that the interests of stakeholders and shareholders are not properly balanced. According to Toyota’s vision, the Board of Directors and decision making has been scaled down (Corporate Governance, 2011). Shareholders’ main interests boil down to their profits and the high cost of shares. Considering the huge number of shareholders and stakeholders, Toyota created an International Advisory Board comprising stakeholders from different countries. The management work is strictly monitored by the committees working to ensure the company’s commitment to quality.
Toyota is doing a good job of balancing the stakeholders’ and shareholders’ interest by establishing transparent communication procedures where all of the involved parties may share their insight into the company’s business.
Companies contemplating going global may expect a range of new opportunities such as faster growth, new markets for its products, more customers, and boosted sales. An example of a company with global opportunities is Hartmann, a German furniture company known for using non-toxic, solid natural wood in its products. Aside from quality, Hartmann’s designers always raise the bar for innovation, presenting customers with unique solutions. It is worth noting the Hartmann has already made its first step in capturing the global market by opening a subsidiary in Poland in the early 1990s (With a long-standing solid-wood furniture tradition, 2015).
Although since then, no other subsidiaries were opened in other countries. To mirror the success in Poland, the Hartmann may expand the European market by offering unrivalled quality and innovative design. With a diligent market research backed up by a solid global strategy, Hartmann has a strong chance of capturing the global market eventually.
The company that deserves special attention in terms of the ability to adapt to the volatile market and overplay the competitors is Pepsi Cola. The company is extensively using innovation and its willingness to adapt. Pepsi Cola’s mission and vision statement (2015) says “We’re committed to achieving business and financial success while leaving a positive imprint on society – delivering what we call Performance with Purpose” (para. 6).
The company’s innovation lies in its marketing and advertising campaigns which involve football celebrities, thus promoting sports and a healthy way of life. Over the years, the commercials are becoming more and more innovative, involving top athletes, thus encouraging the youth to engage in sports. Any company’s ability to innovate depends on strong leadership and the right people inside the company (Trapp, 2014). It appears that Pepsi is using both of this governing principals by employing creative market specialists and providing strong leadership.
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Faulkenberry, K. (n.d.). Sustainable Competitive Advantages: Definition, Types, & Examples. Web.
Kolowich, L. (2015). 12 Truly Inspiring Company Vision and Mission Statement Examples. Web.
Lee, J. (2015). Samsung Surges Most Since 2009 as Profit Beats Estimates. Web.
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Trapp, R. (2014). Successful Innovation Leaders Make Their Organizations Ready And Willing To Perform. Web.
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With a long-standing solid-wood furniture tradition. (2015). Web.