Strengthening a Companys

Competitive Position
SHABBIR AHMED SHOVO
CHIN JIA JUN

WHAT IS AN OFFENSIVE STRATEGY?

An offensive strategy implies for two
aspects of an organization:
Improve Market Position
Improve Business Performance

Should be based on an organizations

strongest competitive assets
Should consider the Strengths and
Weaknesses of the rivals

MULTIPLE OFFENSIVE STRATEGY

OPTIONS

Offer products at a lower price

Leapfrog competitors in the market place
Pursue continuous product innovation
Adopt and improve on competitors ideas

WHOM TO APPLY AN OFFENSIVE

STRATEGY ON
Vulnerable Market leaders
Struggling enterprises
Small, local and regional firms with limited
capabilities
Runner-up firms

BLUE-OCEAN STRATEGY
A special type of offensive strategy
This strategy describes how an
organization make high profits and
revenues by inventing new industry
segments that can create a huge demand
in the market

WHAT IS A DEFENSIVE STRATEGY?

To protect an organization and its:
Market position
Competitive Advantage

It requires to take actions that diminish the

competitive attack options of the rivalry

WHEN TO APPLY OFFENSIVE AND

DEFENSIVE STRATEGIES
In order to know when to apply one of
these strategies, an organization must
consider to being:
A first mover
A first follower
A wait-and-see late mover

STRENGTHENING A COMPANYS MARKET

POSITION BY SCOPE OF OPERATIONS

A set of activities performed internally,

including the various span of products and
services offered within a geographic
market presence.
Two scopes of operations relevant to the
strategy are:
o Horizontal scope
o Vertical scope

HORIZONTAL MERGER AND

ACQUISITION STRATEGIES
Involves a combined set of operations of firms
within the same product or service market to
achieve the intended objectives such as:
Create a cost-efficient operation
Expand a companys geographic coverage
Extend into new product categories
Gain access to new technologies

Vertical Integration
Strategies
Vertically integrated firm participates in
multiple segments or stages of an
industrys value chain system.
Backward integration entering into
earlier segments/stages of the industry
value chain system.
Forward integration entering into value
chain system activities closer towards the
end user.

Disadvantages of Vertical
Integration Strategy
Flexibility is hindered
Takes up an extreme amount of
capital
Increased business risk
Developing new and different types
of resources and capabilities

Outsourcing
A decision to abandon certain stages of
the value chain activities internally,
contracting them out to vendors
Feasible when:
- Activity can be performed better / cheaper
outside
- Activity is not crucial in maintaining
sustainable competitive advantage
- Allows company to focus on its core
business
- Reduces risk exposure to technology or
buyer preferences

Strategic Alliances and Partnerships

Formal agreement between 2 or more
separate companies in agreeing to work
cooperatively
to
achieve
mutually
beneficial objectives
Joint venture a partnership involving the
establishment of an independent & new
corporate entity, which partners own and
control jointly, sharing revenues and
expenses.

Benefits of Strategic
Alliances
Gaining capabilities
Sharing the financial risk
Achieving synergy and competitive
advantage
Winning the political obstacle
Increased Brand Awarenessand
opportunity to Reach New Markets

Thank you