CHAPTER 2: IDENTIFYING COMPETITIVE ADVANTAGE

Hmm minggu ni sepatutnya sis teruja sebab nak cuti midsem dah ..tapi lain pulak rasa nga keje bertimbun..banyak pulak assignment buat...pendek kata cuti midsem ni pun xmampu la g memana kena siapkan assignment sebab naik cuti je nak kena hantar...mood nak balik rumah terus melayang hilang ...ni la namanya belajar kalau xda keje assignment memang xsah...pape pun belajar kena utamakan ..kalau tak,, apa guna parent hantar belajar kalau xnak gunakan peluang tu sebaik mungkin..peluang xkan datang dua kali ..selagi boleh menuntut ilmu ,, tuntut laa banyak2..selagi hidup ni jangan lepaskan peluang untuk berilmu..tapi bila berilmu tu jangan la sombong pulak.. hmm panjang pulak bebel ..sebenarnyaa sis nak share apa yang sis belajar about the subject of information technology..sis baru habis belajar chapter dua..so, nak share la sikit nga awak2..

CHAPTER 2:IDENTIFYING COMPETITIVE                                ADVANTAGES

To survive and thrive an organization must create a competitive advantage

• Competitive advantage -a product or service that an organization's customer place a greater value on than similar offerings from a competitor.
• First-mover advantage- occurs when an organization can significantly impact its market share by being first to market with a competitive advantage.

Organizations watch their competition through environmental scanning

• Environmental scanning- the acquisition and analysis of events and trends in the environment external to an organization.

Three common tools used in industry to analyze and develop competitive advantages include:

• Porter's Five Forces Model
• Porter's three generic strategies 
• Value chains

                                                        PORTER'S FIVE FORCES MODEL

\

• BUYER POWER                                                                                                                               

  Buyer power is low when they have few choices, and high when they've many choices. In order words, when they have many choices their power to purchase is high and when they are lack of choices, their power to purchase is low. For example ,if you are as a buyer and you've many choices, you will get to choose the products that is convenience and suits to yourself . But, if you are lack of choices, you will have no other options so that you will buy the products although it expensive.

2 ways to reduce buyer power through loyalty program. 

a)     Loyalty Program

     Rewards customers based on the amount of business they do with a particular organization.

b)    Switching Cost

     Cost that can make customer refused to change or switch to another product or service.

• SUPPLIER POWER

Supplier power is high when buyers have few choices of whom to buy and low when their choices are many. 

Business to business (B2B) marketplace - Internet-based service that brings together many buyers and sellers.

2 types of B2B:

1. Private exchange - buyers open its needs and open bidding to any supplier who would care to bid with a low price.
2. Reverse auction - increasing lower bids are solicited from organizations willing to supply the desired service or product at an increasingly lower price.