Five Approaches to Differentiation Strategy

In order to achieve competitive advantage against the competitors, corporations carry out the strategy to distinguish themselves from the competitors in aspects of product, service, image, and etc. The focus of differentiation strategy is to creative the product and service, which is considered to be unique and special by the industry and customers. The foundations of the implement of differentiation strategy are customer needs, competitors, products and services levels. There are many means to carry out differentiation strategy. Such as product differentiation, service differentiation and image differences and so on. By carrying out differentiation strategy, the brand loyalty of users will be cultivated successfully and the corporation can also avoid the direct confrontation of competitors.… Read the rest

Analysis of Porter’s Diamond Model of National Advantage

Michael Porter introduced the diamond model of national competitive advantage (1990) to explain why a number of countries are more competitive than others and why a number of businesses within the countries are more competitive. Porter’s Diamond Model proposes that the national home base of an industry plays an important role in achieving an advantage on a universal scale. This home base contributes the essential factors that will support the organisations in building advantages in global competition.

Porter identified four determinants in attaining a national competitive advantage he concludes that a combination of the four determinants within a nation has an enormous influence on the competitive strength of the firms located there.… Read the rest

Core Competencies – Competitive Base for Organizational Success

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.  … Read the rest

Case Study: The Merger between Daimler and Chrysler

DaimlerBenz AG of Stuttgart, Germany, and the Chrysler Corporation of Auburn Hills, Michigan, surprised the business world at a press conference in London on May 7, 1998, when they announced their “merger of equals made in heaven.” This major cross-border transaction, with an equity value of $36 billion, was the largest merger of its kind to date.  Robert Eaton and Jürgen E. Schrempp, co-chairmen of DCX, announced their expectation that this deal would be “not only the best strategic merger or the best prepared merger, but also the best executed merger.”

Daimler-Benz Chief Executive Jürgen Schrempp had concluded as early as 1996 that his company’s automotive operations needed a partner to compete in the increasingly globalized marketplace.… Read the rest

Glocalization – Definition, Advantages and Disadvantages

Globalization is one of the most important phenomena of the recent past and of the future. The term “Globalization” describes an ongoing process by which regional economies, societies and cultures are becoming more integrated through a dramatically increased global network of technological, economic, political and cultural exchanges. In specifically economic contexts, the term refers to the integration of national economies into the international economy through trade, particularly trade liberalization or free trade, foreign direct investment, capital flows, migration and the spread of technology. This worldwide phenomenon of interaction among the countries is driven largely by advances in communication, transportation and legal infrastructure as well as the political choice of countries to open cross-border links in international trade and finance.… Read the rest

Case Study of Zara: A Better Fashion Business Model

Zara is one of the most well known brands in the world and is also one of the largest international fashion companies. They are the third largest brand in the garment industry and are a unit of Inditex. It their flagship range of chain stores and are headquartered in Spain. Zara opened its first outlet in Spain in 1975. The headquarters of the company is based in Galicia. There are more than 2600 stores across 73 countries in the world. The Zara clothing line accounts for a huge bulk of its parent group’s revenues. There are other clothing brands owned by Inditex such as Kiddy ´s Class (children’s fashion), Pull and Bear (youth casual clothes), Massimo Dutti (quality and conventional fashion), Bershka (avant-garde clothing), Stradivarius (trendy garments for young woman), Oysho (undergarment chain) and Zara Home (household textiles).… Read the rest