Competitive Strategy in an E-business

Solution Preview

Companies should constantly make changes in the way they manage their firm to keep up with the competition and to satisfy the consumers. For example, Ford, Chrysler and GM must always change their business tactics and strategies to lure customers and to stop the Japanese competition from taking away their customers. As experienced in the summer of 2005, the American competitors changed their strategy by offering employee discounts. Sales however, did increase but consumers were still lured to the Japanese imports. Thus, they needed to improve their strategy and adapt to the ever changing needs of the market. There is no doubt that strategies evolve because of the unexpected responses such as competitors actions. Thus a company's strategy must be combined with a proactive strategy and reactive strategy

According to the Michael Porter, there are three competitive strategies which are (1) overall cost leadership, (2) differentiation, and (3) focus on a particular market niche. The generic strategies provide direction for business units in designing incentive systems, control procedures, operations, and interactions with suppliers and buyers, and with making other product decisions. Thus organizations need to ask:
Are these capabilities and competitive advantages grounded in the basic principles of operational excellence, product leadership, and/or customer intimacy? If so, how are these capabilities and advantages made apparent to customers?

Case of e business
Chuck Martin, best selling author of Digital Estate and founder of Netfuture Institute says ...