In the ever-changing global marketplace, how does a company maintain its competitive advantage over other players in the industry or marketplace? To answer that let's first define the term, "competitive advantage." Competitive advantage is the ability to win market share or earn a higher profit than competitors. A successful business model results from business-level strategies that optimize competitive positioning.
This paper will evaluate competitive advantage methods, their associated strengths and weaknesses, constraints and regulations and finally recommendations for competing in the global marketplace. One of the strategies that many companies explore is outsourcing. The driving force behind this decision is often reduction to overall costs leading to competitive advantage and customer satisfaction. First, this writer will discuss the optimal choices made during the "Evaluating Outsourcing Decisions" simulation to set the foundation to discussing the methods for maintaining competitiveness.
Simulation OverviewIn January 2005, PanFina, Inc. decided to utilize the outsource business model.
Català: Michael Porter. Česky: Michael Porter. D...
English: An illustration of the three types of com...
English: An illustration of competitive advantagePanFina decide to outsource four of its seven non-core processes to Banjaria. The decision was aimed to strike a balance between the risks of offshore outsourcing and the overall cost-savings.
In June 2005, PanFina evaluated vendors on its service quality, scale of operations, reputation, and the control that PanFina would have over the vendor, besides cost. PanFina selected Numarick while being the costlier vendor of four. The discount offered offset the difference in costs. However, they are the largest outsourcing company and they could to handle the scale of operations that PanFina required to provide the best returns over the longterm (University of Phoenix, 2007).
In January 2008, PanFina's customers were complaining about poor customer service and employees were not happy with the support provided. Not panicking over the situation, PanFina analyzed the options, worked with vendor and decided only to return one of the non-core processes back to...