Competitive Advantage Strategies

This assignment delves into the concept of competitive advantage in business. It examines various strategies firms employ to gain an edge over competitors, including cost leadership, differentiation, and focus. The paper discusses Porter's generic competitive strategies and the Blue Ocean Strategy as frameworks for analyzing and implementing these approaches. It emphasizes the importance of creating a unique value proposition and meeting customer needs effectively to achieve success in a competitive market.

Running head: PERFORMANCE APPRAISAL 1
Competitive Advantage Strategies or Process.
Student’s Name
Institution’s Name

PERFORMANCE APPRAISAL 2
Competitive Advantage Strategies
Globally, business competition is high as the number of entrepreneurs has increased
tremendously in the market. These results to the availability of a large pool of sellers from which
the consumer can choose from when buying goods and services. Therefore, the entrepreneurs
scramble and compete for the limited numbers of potential customers in the market. Firms are
continually seeking for competitive advantage in the marketplace. These ensure that the firms'
products have high sales in the market compared to those of the competitors in the market.
Competition in the market is unavoidable, and therefore companies have to look for ways to
attract a high number of customers compared to the competitors. This paper will look at the ways
a firm can use to become competitive in the market (Rothaermel, 2015).
According to Kim and Mauborgne (2014), blue ocean strategy is the ideal way of firm
battling competitors in the marketplace. This plan aims at creating "blue oceans" of uncontested
market space which is ripe for growth. The "blue oceans" are areas of no competition for the
firms' products and service. These areas make the firm be the sole supplier in the market hence
have high sales. This strategy aims at getting a marketplace which has no competitors. Despite
the fact that businesses cannot avoid competition in the market these can be created through
intensive differentiation of the company's products and lower the costs of the products.
According to Tanwar (2013), Porter notes that firm's position in the industry determines
whether its profitability is above or below the industry average. The competitive advantage of a
company in the market ensures that profit is above the standard in the industry. A firm has two
competitive advantages' which are low cost and differentiation. Competitive advantages
strategies of a company entails ways of a business ensuring it competes effectively in the market.
These plans include; cost leadership, differentiation, and focus.

PERFORMANCE APPRAISAL 3
i. Cost Leadership
In this strategy, the firm becomes a low-cost producer in the industry. These are achieved
through the firm pursuit of economies of scale, proprietary technology, preferential access to raw
materials and other factors. The firm is, therefore, able to offer its products at lower prices
compared to those of competitors in the market thus attracting a large number of potential
customers.
ii. Differentiation
The firm in differentiation strategy seeks to make itself unique through its products and
services. These would make its products have high sales in the market as they have no
competition. The firm is rewarded for its uniqueness with a premium price.
iii. Focus
Focus rests on the ability of a firm to choose a narrow competitive scope in the market.
These include the company paying attention in specific segments in which its products have a
high number of customers. These make the firm reduce unnecessary costs and meet its target
market fully (Porter, 2008).

PERFORMANCE APPRAISAL 4
References
Kim, W. C., & Mauborgne, R. A. (2014). Blue ocean strategy, expanded edition: How to create
uncontested market space and make the competition irrelevant. Harvard business review
Press.
Porter, M. E. (2008). Competitive strategy: Techniques for analyzing industries and competitors.
Simon and Schuster.
Rothaermel, F. T. (2015). Strategic management. McGraw-Hill Education.
Tanwar, R. (2013). Porter’s generic competitive strategies. Journal of Business and
Management, 15(1), 11-17.