Question

In: Operations Management

Productivity is a key factor in the cost of goods and services. Increases in productivity can...

Productivity is a key factor in the cost of goods and services. Increases in productivity can become a competitive advantage. Select two retailers (e.g., Verizon and AT&T) or a certain product (e.g., cell phones) and state different ways they compete. Discuss ways a company can gain a competitive advantage by having higher productivity than its competitors have. Add how monopolies compare and give real-life examples.

Solutions

Expert Solution

PRODUCTION A KEY FACTOR ( Product : Cell phones):

  • If an organization extending its services globally its production level is always meets the requirements of the people.
  • The availability of products that meets the demands of people gets the profits and growth to the organization.
  • If an organization wants to increase its production the raw material and other things needs to be arranged for higher production
  • Every organization intension is to increase its production without increase of the product value its profits values are to be high.
  • The organization can gain huge profits with the increase of production and supply to the market.
  • If the product is low the margins that gain by the industry is also falls as there is no many sales to gain the profits.
  • If an organization needs to increase its production the resource is needs to be high in order to create enough production
  • The new technology needs to be installed for the increased production in less time
  • The skilled manpower required to gain the huge market gains through production
  • At the same time the services to the product is also needs to increase as the product is hitting the markets
  • The service team needs to be available to provide the immediate solution to the product
  • As there is a increase demand for cell phones in the market there is huge demand for production of its parts and services
  • So the companies are ready to increase their production of cell phones as per market demands
  • As the usage increases the production value of the product is equally increases, if that happens the industry will grow high in less time

ADVANTAGE OF INCREASE PRODUCTION THAN ITS COMPETITORS:

  • An organization only beats its competitors in only two places one in production and other in quality
  • When they can able to produce enough goods than obviously they will be the leading industry in the market.
  • They have to produce all the parts to their product along with that they should enough team to service
  • The increase production compare with other competitors bring huge growth and demand in the market at the same time needs proper service team to immediate attention to the product service
  • The skilled and professional technical team needs to hire the companies to compete with their competitors
  • This can be attained when there is huge demand and value for their brands
  • Brand value cam also be increased with high production as most of the products that are available with only high production company
  • Than people automatically purchase the products that are huge in the market
  • There should not be any price difference compared with competitors than they can attains best results with high production

MONOPOLIES COMPARE:

  • Monopolies are one who will sell the same and unique products on the market. They are not homogeneous products. There is differentiation on product selling costs
  • They can come and any time to the market and suspend their services at any time
  • They will not have any knowledge of the market as per the market demand they try to do some market with no clarity
  • They take their own decisions, like increase and decrease the product price; they enjoy the market power for increase and decrease of their product value.

REAL EXAMPLE:

  • There are so many companies that enjoy the monopoly concept let’s take example of mobile phones there was a huge demand for windows mobile that released by the Microsoft company. There was huge demand for mobiles as that was the only company who manufactures windows mobiles and the cost of the mobiles are also high.
  • As the technology increases and iphones are into the market than the demand for windows are getting decreased ,as compared with Microsoft windows the speed and durability and performance of iphone ios is ever lasting
  • Now as the technology changes and the Microsoft windows same mobile are introduced with Android operating systems
  • Google started developing mobile phones with its own Android technology based mobiles and there are so many companies are using android technology for low cost and almost equal performance with high end mobiles.

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