CHAPTER 2 : IDENTIFY COMPETITIVE ADVANTAGE

Now  I will be continue with chapter 2 is about :

Competitive Advantage are divide into 3 advantage :

• A product or service that an organization's customers place a greater value on than similar offerings from a competitor.

The Five Forces Model :

• Michael Porter's Five Forces Model is useful to aid organization in challenging decision whether to join a new industry or industry segment.

   

1. BUYER POWER : The power of customers to drive down prices.
2. SUPPLIER POWER : The power of suppliers to derive up prices of material. Refer figure 1.1
3. THREAT OF SUBSTITUTE PRODUCTS AND SERVICES : The power of customers  to purchase alternatives.
4. THREAT of  NEW ENTRANTS :  The power of competitors to enter a market.

Figure 1.1

THE THREE GENERICS STRATEGIES :

• COST LEADERSHIP : Low cost product in the industry.
• DIFFERENTIATION : The product on one or more features important to their customers.
• FOCUSED STRATEGY : Target to a niche market.

THE VALUE CHAINS (PROCESS) :

• Supply Chain - a chain or series of processes that adds value to product and services for customer. 
• add value to its product and services that supports a profit margin for the firm.

•  A chain or series of processes that adds value to product & service customer.