Sse The Future Of Competition Group4


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Media Management 2009 Group 4 Assignment (KTH&SSE)

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Sse The Future Of Competition Group4

  1. 1. The Future of Competition Media Management Course Group 4 Zhang Yuanyuan : Zhong Wei : Chi Mingli : Guo Xing :
  2. 2. Outline <ul><li>Abstract </li></ul><ul><li>Key points </li></ul><ul><li>Example </li></ul>
  3. 3. Abstract <ul><li>In buyer–seller relationships, the focus has moved beyond individual firms to value-creating networks formed by key firms in the value chain that deliver value to the end consumer. </li></ul><ul><li>The article develops a rationale for value-creating networks using three core building blocks: superior customer value , core competencies , and relationships . </li></ul><ul><li>The rationale is developed based upon an understanding of the value-creation process and its links to core capabilities of firms in the network. </li></ul><ul><li>The importance of inter-firm relationships in realizing the true potential of the value-creation networks is also highlighted. </li></ul><ul><li>The authors argue based on their sample analysis of some examples that competition in the future will shift to the network level from the firm level. </li></ul><ul><li>The influence of some emerging business tools such as electronic commerce on redefining value creation is also discussed. </li></ul>
  4. 4. Key Points
  5. 5. Value-creating networks <ul><li>Superior customer value </li></ul><ul><li>Understand value </li></ul><ul><li>Value is the relationship of a firm’s market offering and price weighed by the consumer against its competitor’s market offering and price. </li></ul><ul><li>Step of creating better value than competitors </li></ul><ul><li>fully integrate the resources  use the core capabilities  deliver a product that fully satisfies the needs at a competitive price  create superior customer value </li></ul><ul><li>Multi-benefit model of choice </li></ul><ul><li>Two measurement dimensions: the importance of benefit and the performance of firm on benefit </li></ul>To understand customer value, one needs to go back and revisit the marketing concept.
  6. 6. Value-creating networks <ul><li>Superior customer value </li></ul><ul><li>Firms that can deliver </li></ul><ul><li>superior value </li></ul><ul><li>in the marketplace will win </li></ul><ul><li>the battle for the consumer or customer. </li></ul>Value creation is more complex in business markets.
  7. 7. Value-creating networks <ul><li>Core competencies </li></ul><ul><li>Core capabilities, while few, are the key to delivering superior value. They provide the means to deliver superior performance on the attributes that are important to the buyer. </li></ul><ul><li>To be a core competency, the skill must … </li></ul><ul><li> add significant value to the market offering </li></ul><ul><li> help the firm move across multiple markets </li></ul><ul><li> be performed at a superior level that very few firms can emulate. </li></ul>The competency gives firms the ability to deliver performance on important benefits.
  8. 8. Value-creating networks <ul><li>Relationships </li></ul><ul><li>Firms are moving into an environment… </li></ul><ul><li>in which they will not compete against </li></ul><ul><li>each other but will become a member </li></ul><ul><li>of a network of firms that will compete </li></ul><ul><li>against another network of firms. </li></ul>Value-creating networks are firms that come together to create customer value.
  9. 9. Value-creating networks <ul><li>Relationships </li></ul><ul><li>The ideal partner is… </li></ul><ul><li>the one who adds significant value to </li></ul><ul><li>your market offering </li></ul><ul><li>and at the same time presents low risk as </li></ul><ul><li>a partner. </li></ul>Develop strong relationships with key partners who can add value to the market offering. low high Operating risk low high Value added to partner Evaluation of potential partners Developmental Loser Integrative Facilitative
  10. 10. Value-creating networks <ul><li>The model </li></ul>Doing a value network analysis challenges the firm and its model of doing business. The model uses the three core concepts of value creation, namely superior customer value , core capabilities and relationships , to propose a reciprocal model that captures the nature of Interrelationships between the three core concepts.
  11. 11. E-Commerce E-Commerce is to help distinguish between product value-added and process value-added. high low Product value added low high Process value added Relationship between product and process value The firm with the most value to offer will likely be able to negotiate a higher price than the lowest bidder who provides less value. The greater the impact of the seller’s product values upon the buyer’s product the greater the seller’s ability to extract a premium price. Relationship Bid Deep relationship Negotiated Bid
  12. 12. Example
  13. 13. Computer Weekly Introduction <Computer Weekly> was established in 1992, and today is the No. 1 sale IT newspaper in China. The statistics in 2007 showed that its market share was 71.55% and the coverage rate was 74.09%. Its official website Shudoo provide s varieties of information, resources, and IT services, which make it become a one-stop portal website. Official website: http://www.
  14. 14. Analysis Official website: http://www. Computer Weekly Value-creating networks and e-commerce In 2004, Computer Weekly established co-partnership company with Tom Group which has extensive business and rich management and marketing experience. They began to search for new market resources including network resources, human resources and capital resources. Computer Weekly soon expanded its brand influence overseas. At the same time, the co-partnership company developed new areas such as data analysis and consultant, which provided clients complete service about market information. In 2008, Computer Weekly created cooperation with SNDA Group, which is the leading online game company in China, and entered the game industry. Nowadays, the traditional print media are facing fierce competition. The e-commerce becomes a new way out to gain profits in this competitive industry.
  15. 15. References <ul><li>Articles </li></ul><ul><li>Konthandaraman & Wilson </li></ul><ul><li>The Future of Competition Value-Creating Networks 2001 </li></ul><ul><li>Online resources </li></ul><ul><li> </li></ul><ul><li> </li></ul><ul><li> </li></ul><ul><li> </li></ul><ul><li> </li></ul>
  16. 16. Thank you! Group 4 2009.01.26