Question

According Intel Corporation : 1968-2003 HBS CASE (9-703-427);

What are the potential sources of competitive advantage in the industry? In particular,

What determines willingness to pay?

What determines relative cost position?

-case consists 25 pages.I can't attach it.

Answer 1

The potential sources of competitive advantage in the industry

1. Localization in Global Markets
   Real-time strategies of localization and globalization in global market can return a company to a profitable growth path.
   2. Strategic Alliance or Acquisition
   Strategic Alliances are an significant source of capabilities a firm may not possess otherwise. A small number of firms have all the capabilities desirable to contend successfully in our world of fast-paced change. “in spite of the fact that an alliance is created nearly every 90 seconds while failure rates come out to take place in virtually 60 percent of all alliances.(4) mostly failure is not a function of the association being a bad strategic option but failure is attributable to managerial error.” As a result, successful strategic alliances can bring noteworthy competitive benefit.
   3. Competitive Actions
   significant organizational alteration, or refined coordination between different departments are the competitive actions companies will want to make.
   Effective competitive measures can vary by environment. In emerging markets, ample of uncertainty exists, thus investors have a preference for the companies with more expected and simple competitive moves, which encourages enhanced investor valuation and so offers competitive advantage.

4. Customer Clusters
Research has revealed that firms situated near customers cluster innovate extra quickly. This is mostly because more customer involvement and a real-time information flow.

5. Company-Wide Market Orientation. A real market orientation involves offering more customer value because of an exceptional understanding of the customer as well as competitors which permeates the organization.while it takes some time for the market orientation to have a constructive effect, so management needs to offer support. The study finds under highly competitive pressure, a company gains advantage with a market orientation.


6. Strategic Fit between Marketing and Manufacturing
Organizing marketing behavior in ways which fit a business’s tactic type can form a important source of competitive advantage. The core of this is to make certain the customer necessities of the company’s marketing policy are met by the manufacturing strategy. Misalignments should be recognized and changed into strategic fit. Strategic fit among marketing and manufacturing can compel such well-built relationships of trust and reputation.

7. Implementation of Strategy
It is achievable to contend fruitfully with advanced execution of strategy relatively than superior strategy. While markets turn out to be more established, and the environment becomes less vibrant and there are less opportunities to build up a improved product or new strategy. As a result, superior performance can win the day.


8. Human Capital
Human capital in the type of a highly skilled labor force can become the source of competitive gain, predominantly if employees do not take their skills to competitors. If a firm is capable to keep hold of employees then the skills of interest to competitors can be a source of competitive advantage.

9. Employee Engagement
Many studies demonstrate that employee engagement can be a source of competitive advantage. Highly satisfied, motivated, dedicated and fully busy employees yield a higher market share than their competitor.

10. Technological Change
In today’s time of immense technological advances, numerous opportunities for gaining competitive advantage through technological innovation are present. Still, a company needs to generate a culture which is open to adopting new technology efficiently.

11. Production System
Implementation of an efficient production system can bring companies competitive advantage.

13. Business Processes
organization steady business process flawlessly is another source of competitive advantage. As in case of Toyota, they added product value due to the Six Sigma and product design processes. Business process upgrading can be a cost-effective approach as it can occur exclusive of technological change.

Willingness to pay is the maximum price at or below which a consumer will certainly buy one unit of a product, which corresponds to the customary economic view of consumer reservation price.

In according to the constructive preference view, consumer willingness to pay is a context susceptible construct, which means a consumer's maximum WTP for a product mainly depends on the material decision context.

A relative cost position is a comprehensive analysis which includes the production capacity as well as the cost positions of every contending company in the economic marketplace. Business owners make use this information to produce a chart which indicates which companies are having the lowest and highest relative cost position in the market, which also outlines the whole industry’s supply of definite consumer goods or services. Strategic management can be used in accounting to decide economies of scale, dropping individual unit costs by escalating the amount of production output. Though, the majority of the companies more often than not have a point where an economy of scale does not offer any more advantages. A company’s economy of scale is typically the best relative cost position for its goods or services in the economic marketplace.