Competence is considered as the most important attribute without which a business cannot enter or survive in an industry. Competences develop from resources and skills, technology and know-how all together makes up competences. For example in the pharma industry in order to survive or operate successfully a very specific understanding of the special equipment’s needed to manufacture medicines and how a medicine works on the human body is important. That is every player in the industry needs to possess each of these competences in order for it to survive long term. Core Competences are the skills and abilities by which resources are deployed through an organisations activities and processes such as to achieve competitive advantage in ways that others cannot imitate or obtain. Core competence is a distinctive capability that enables an organisation to perform above the average industry performance. In the 1990s this concept gained momentum after the introduction Continue reading
International Business Strategies
Defensive Strategies Against Hostile Takeovers
With the development of economy and technology, competition among enterprises is becoming increasingly intense. Many companies decide to expand their companies scale and business through mergers and acquisitions to achieve maximum profits. Takeover is a business behavior that one company is purchased by another one. There are several types of takeover, including friendly takeovers, hostile takeovers, reverse takeovers and back-flip takeovers. Even though some mergers and acquisitions can bring about synergy and more substantial profits, some takeovers are not welcome. Therefore, a large numbers of measures are taken by target companies to defend the hostile takeover. Different Types of Defensive Strategies Against Hostile Takeovers Defensive strategies can be classified into active measures and preventive measures. Active measures consist of greenmail, standstill agreement, white knight, and so on, while preventive measures are made up of poison pills, people pill and other defenses. In particular, greenmail, poison pills, staggered board terms and Continue reading
Competitive Advantage of Internationalization Strategies
First, the structure of competition is undergoing a profound change. Competitiveness is moving rapidly from a national to an international – indeed, global-scale. It is clear that, even with government purchasing, fewer segments of industry remain defensible at the national level in, for example, consumer electronics, telecommunications, transport technology and power engineering; and there is a growing list of sectors where companies are experiencing the benefits of value-added from design to sales. In some sectors, it can be in terms of designing products for many markets, thus lowering production costs earlier than is possible for purely national forms (worldwide designs can cover 80 per cent of customer needs, with 20 per cent for local adaptations). Secondly, competitive advantage, as the basis for strategy, must rest on some clear sustainable product or market factor, controlled by the firm, which is superior to what other companies can offer or deliver. This can Continue reading
Case Study: Critical Success Factors of Dell
DELL’s direct-to-customer business model is the key to the company’s dramatic growth and success and has focused on selling directly to customers. This helps eliminate the middleman and offers customers more powerful configured systems than most competitors. The direct model enables DELL to develop a thorough understanding of customer expectations, which strengthens customer relationships and increases customer satisfaction and loyalty. One of the characteristics that distinguishes DELL from its other competitors is that DELL provides the mode to custom the computers of the customers’ choice and taste and deliver the system to the customer as it is the most crucial and critical success factor behind DELL Computers. Therefore, DELL must be aware of the benefits they wish to realize, how it will be realized and ensure only investments of appropriate amounts of resources to obtain benefits. DELL relies on reputation in the US market of award-winning service and a high-quality Continue reading
Case Study: Competitive Advantage of Hewlett Packard (HP)
Hewlett Packard popularly called HP is a company that provides technology solutions to consumers, businesses and all forms of institutions worldwide. The company later expands its operations to IT infrastructure, personal computing and access devices, global services and imaging and printing services. The company is known throughout the world by operating in more than 170 countries around the world. The mission of the company is to facilitate how technology and services can assist individuals and institutions in addressing their problems and challenges so as to realize their dreams. The company applies new thinking and ideas come out with basic and valuable experiences with the technology with her IT corporation headquarter in Palo, Alto, California, USA. The company has been maintaining a lead among her contemporaries due to the effective strategic planning of the company and this has been jealously guided by the company in virtually all her businesses. How Competitive Continue reading
Evaluation of Porter’s Diamond Model
In the globalization era, we observed an increment of multinational corporations as well as small businesses that aim to internationalize. Those, in order to be successful in their internationalization process, try to find abroad a location that fits them the most institutionally, culturally and opportunities wise. To make this happen, MNCs uses home and host location strategies which reflect to international business theories through different models. Those models assess external environment analysis of a specific country and explain the concepts used behind the chosen location. Out of the many useful models explaining location strategies used by international companies, this article will focalize on the Diamond Model and discuss whether is a useful concept for international firms to pursue the best entry mode and furthermore argue the advantages and disadvantages through the examination of a real case example such as the multinational IKEA. The Diamond Model was introduced in the book Continue reading