Page 37 - E2 Integrated Workbook STUDENT 2018
P. 37

Competitive advantage





                           Competitive advantage





               1.1   Competitiveness and competitive advantage

               When developing a corporate strategy, the organisation must decide on which basis
               it is going to compete in its marketplace. This involves decisions on whether to
               compete across the whole marketplace or only in certain segments.

               Competitiveness is essentially the ability of an organisation, sector or economy to
               perform well against other organisations, sectors or economies.

               Organisations must also consider how they can gain competitive advantage.
               Competitive advantage is anything that gives on organisation an edge over its rivals
               and which can be sustained over time. To be sustainable, organisations must seek to
               identify the activities that competitors cannot easily copy and imitate.

               The important aspect of competitive advantage is that is must be sustainable.


               1.2   Porter’s three generic strategies


                    Cost leadership

                    Differentiation

                    Focus



































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