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Updated on 05/05/2015

BusAd 177: Introduction to International Marketing

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Global Marketing [Book]

Chapter 16:

Strategic Elements of Competitive Advantage

with your questions
 
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Overview

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Lecture Outline

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Discussion Questions

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Test Your Knowledge

     
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Summary

  • In this chapter we focus on factors that help industries and countries achieve competitive advantage. According to Porter's five forces model, industry competition is a function of the threat of new entrants, the threat of substitutes, the bargaining power of suppliers and buyers, and rivalry among existing competitors. Porter's generic strategies model can be used by managers to conceptualize possible sources of competitive advantage. A company can pursue broad market strategies of low cost and differentiation or the more targeted approaches of cost focus and focused differentiation. Rugman and D'Cruz have developed a framework known as the flagship model to explain how networked business systems have achieved success in global industries. Hamel and Prahalad have proposed an alternative framework for pursuing competitive advantage, growing out of a firm's strategic intent and use of competitive innovation. A firm can build layers of advantage, search for loose bricks in a competitor's defensive walls, change the rules of engagement, or collaborate with competitors and utilize their technology and know-how.

 

Chapter Overviews, Outlines, Sample Questions

  1. Introduction to Global Marketing

  2. The Global Economic Environment

  3. Regional Market Characteristics and Preferential Trade Agreements

  4. Social and Cultural Environments

  5. The Political, Legal, and Regulatory Environments

  6. Global Information Systems and Market Research

  7. Segmentation, Targeting, and Positioning

  8. Importing, Exporting, and Sourcing

  9. Global Market Entry Strategies: Licensing, Investment,
    and Strategic Alliances

  10. Brand and Product Decisions In Global Marketing

  11. Pricing Decisions

  12. Global Marketing Channels and Physical Distribution

  13. Global Marketing Communications Decisions I: Advertising
    and Public Relations

  14. Global Marketing Communications Decisions II: Sales Promotion,
    Personal Selling, Special Forms of Marketing Communication

  15. Digital Revolution

  16. Strategic Elements of Competitive Advantage

  17. Leadership, Organization, and Corporate Social Responsibility

 
 
 
 
 
   
 
  • Today, global competition is a reality in many industry sectors.  Thus, competitive analysis must also be carried out on a global scale. Global marketers must also have an understanding of national sources of competitive advantage. Porter has described four determinants of national advantage. Factor conditions include human, physical, knowledge, capital, and infrastructure resources. Demand conditions include the composition, size, and growth pattern of home demand. The rate of home market growth and the means by which a nation's products are pulled into foreign markets also affect demand conditions. The final two determinants are the presence of related and supporting industries and the nature of firm strategy, structure, and rivalry. Porter notes that chance and government also influence a nation's competitive advantage. Porter's work has been the catalyst for promising new research into strategy issues, including D'Aveni's work on hypercompetition and Rugman's recent double-diamond framework for national competitive advantage.

 

 
 
 
 
 
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Overview

 

 

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Lecture Outline

 

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Discussion Questions
 

1.

How can a company measure its competitive advantage? How does a firm know if it is gaining or losing competitive advantage? Cite a global company and its source of competitive advantage?
 

Click here for hint.

2.

Outline Porter's five forces model of industry competition. How are the various barriers to entry relevant to global marketing?
 

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3.

How does the five partners or flagship model developed by Rugman and D'Cruz differ from Porter's five forces model?
 

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4.

Give an example of a company that illustrates each of the four generic strategies that can lead to competitive advantage: overall cost leadership, cost focus, differentiation, and differentiation focus.
 

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5.

Briefly describe Hamel and Prahalad's framework for competitive advantage.
 

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6.

How can a nation achieve competitive advantage?
 

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7.

According to current research on competitive advantage, what are some of the shortcomings of Porter's models?
 

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8.

What is the connection, if any, between national competitive advantage and company competitive advantage? Explain and discuss.

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Test your knowledge
 

 

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automobiles.

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soft drinks

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