Indentifying Competitive Advantage *Chapter 2

Assalamualaikum. Today i would like to present about my second chapter is Identifying Competitive Advantage. This topic explain why competitive advantage are typically temporary. Discribe the relationship between business processes and value chain. There's compare Porter's three generic strategies.

This diagram shows 5 Forces Model. There is :-

• Industry among Competitors
• Threat of New Entrants 
• Bargaining Power of Buyer
• Threat of Substitutes 
• Bargaining Power of Suppliers

In Industry among Competitors has high when competition is fierce in a market and has a low when competition is more complacent. For example mart and its supplier using IT to enable system for communication and track product at aisles by effective tagging system. It also can reduce cost by using effective supply chain.

in Threat of New Entrants has high when it is easy for new competitors to enter a market and have a low when there are significant entry barriers to entering a market. Entry barriers is a product or services features that customer have come to expect from organisation compete and survive. For example new bank must offer online paying bills, acc monitoring to compete.

In Bargaining Power of Buyer has a high when buyers have many choice of whom to buy and have a low when their choices are few. To reduce buyers power and create competitive advantage. For example can booking thru online.

In Threat of Substitutes has a high when many alternatives to a product or services and have a low few alternative from which to choose. A organization would like to be on a market in which there are few subtitutes of their product or services. For example electronic product have a same function different brands.

In Bargaining Power of Suppliers has a high when buyers have a few choices of whom to buy from and have a low  their choices are many. For example best practices of IT to create competitive advantage. Business to Business marketplace to private axchange allow a single buyer to post and need open the bidding any supplier would care to bid. Reverse Auction an format in which increasing lower bids.

That's all for today. Thank you :) xiexie :)