Creating Competitive Advantage

In a video session, Prof. Idris Gautama So, S.E., S.Kom., M.M., Ph.D delivered a topic on how to create competitive advantage and the importance it has for businesses.

It was mentioned that the significance of recognizing competitors is to establish a competitive advantage. Competitors are businesses providing comparable products or services to the same consumer base. To outperform competitors, businesses must comprehend their strengths and weaknesses, enabling them to develop effective strategies. Michael Porter’s theory outlines four basic competitive positioning strategies, which are cost leadership, differentiation, focus, and middle of the road. The first strategy is cost leadership, which allows our products to be the most economically attractive in the market. The second strategy is differentiation, where we create unique product lines and marketing programs that set us apart from industry leaders. The third strategy is focus, where we serve a specific market segment and cater to their unique needs better than our competitors. However, the middle-of-the-road is not a recommended strategy.

It’s essential to understand whether our focus is on competitors, customers, or the market as a whole. By identifying our position in the four quadrants, we can determine our strengths and weaknesses and adjust our strategies accordingly. While focusing on customers is crucial, we must also pay attention to competitors to effectively “fight back” and stay competitive.

The video below, presented by Prof. Idris Gautama So, S.E., S.Kom., M.M., Ph.D provides a better understanding of the topic.