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Creation of Value and Competitive Advantage

Achieving competitive advantage
- How does the creation of value lead to competitive advantage?
- How may a firm achieve competitive advantage? Consider strategies of cost leadership, benefit leadership and degrees of focus.
- How does the price elasticity of demand affect a firm's strategic positioning for competitive advantage?
- What factors and strategies allow a firm to sustain competitive advantage? Cite at least one real life example of success and one real life example of failure in your explanation.

International Business
- What additional risks do multinational corporations face, and what additional opportunities do they enjoy when compared with domestic firms?
- what strategies may a multinational corporation use to best take advantage of the opportunities discussed above?
- What strategies may a multinational corporation use to best mitigate the risks discussed above?
- How does achieving competitive advantage at an international level differ from achieving competitive advantage at a domestic level? How may a firm strategically position itself for international competitive advantage? Cite at least one example or strategy specific to international business.

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Achieving competitive advantage

- How does the creation of value lead to competitive advantage?
Creation of value leads to competitive advantage because the firm implements a value creating strategy that is not being implemented by other competitors. Competitive advantage is the strategic advantage that one business entity has over competitors in the industry. For example, a firm creates value for its customers by selling to them a superfast tablet computer; it gains competitive advantage in the computer tablet industry. The company has been able to create value by providing a tablet that is much faster than products provided by competitors. This value to customers gives the firm competitive advantage.

-How may a firm achieve competitive advantage? Consider strategies of cost leadership, benefit leadership and degrees of focus.
A firm may achieve competitive advantage if it has cost leadership. In other works its cost structure is such that it cannot be easily duplicated by its competitors. For example, a firm enjoys economies of scale; it gains competitive advantage because of cost leadership.
A firm may achieve competitive advantage because of the benefit that it can provide that others cannot duplicate. This benefit can accrue because of the location of the firm, the special skills its personnel possess, or the technology it has. For example, a hotel is located close to the legislative assembly (place where laws are made) of a country. Because of the unique benefit this hotel provides, it has competitive advantage.
A firm may achieve competitive advantage because of the degree of focus it has. Its focus gives the firm a strategic advantage. For example, a publishing firm focuses entirely on medical books. The focus of this firm gives it several strategic advantages that help it attain sustained competitive advantage.

- How does the price elasticity of demand affect a firm's strategic ...

Solution Summary

Competitive advantage is discussed very comprehensively in this explanation..

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