This presentation shows info on Technological and Competitive Environment of business

2. TECHNOLOGICAL
AND
COMPETITIVE
ENVIRONMENT

3. TECHNOLOGICAL
ENVIRONMENT

4. TECHNOLOGICAL
ENVIRONMENT
• According to J.K Galbraith
“ Technology is a systematic application
of scientific or other organized knowledge
to practical tasks”

5. FEATURES OF TECHNOLOGICAL
ENVIRONMENT
• Growth.
• Technology makes more technology possible.
• It requires research and development.
• Helps promote business using Technology.
• Shows not only the success of the firm but also of the
country.

6. IMPACT OF
TECHNOLOGY ON BUSINESS
• Increased Productivity.
• Need For Professional Managers And Skilled
Employers.
• Technology Creates Substitutes.
• Technology Results In Opposition.
• It Has Increased Business Mobility.

7. COMPETITIVE
ENVIRONMENT

8. COMPETITIVE
ENVIRONMENT
• Means the immediate competitive factors in
which an organization conducts its activities.
• Michael Porter’s Five forces of competitive
positions analysis is a framework for
assessing and evaluating the competitive
strength and position of an organization.

10. RIVALRY AMONG
EXISTING COMPETITORS
• Organizations in an industry are affected by the number
of competitors and capability of the competitors.
• Competitive strategies of an organization make use of
techniques like rigorous promotion of products, providing
good customer service, reducing the price of the
product etc.
• When the fixed costs are high the rivalry among the firms
increases because of economies of scale.

11. THREAT OF NEW ENTRANTS
• Second force that creates competition is new Firms
entering the industry.
• Threat of new entry depends on the entry and exit
barriers.
• When entry and exit barriers are low, the firms easily
enter and exit the industry, the profit is low and vice
versa.
• Government controls entry of new firms with policies and
laws.

12. THREAT OF SUBSTITUTES
• Substitutes means the products of
other firms.
• Threat of substitutes means the threat
when the demand for product of firm
gets affected because the price of the
substitute product of other firm gets
changed.
• Price of substitute commodities.

13. BARGAINING POWER
OF BUYERS
• Powerful buyers are able to force the
industry to reduce the prices of the products.
• The smaller the number of buyers the greater
is the bargaining power of the buyers.
• The greater the size of the order; greater is
the bargaining power of the buyers.
• Cost of switching.

14. BARGAINING POWER
OF SUPPLIERS
• When suppliers have bargaining power,
they sell their products at higher prices and
exercise power on the firm.
• When supplier demands for more share in
profits, the profits of the firm get reduced.
• If the product supplied has unique features
and has no substitutes, supplier is powerful;
he can demand more price.

15. Competitive
Strategies
Cost
Leadership
Strategy
Differentiation
Strategy
Low-Cost
Focus
Strategy
Differentiation
focus strategy

16. COST LEADERSHIP
STRATEGY
• Goods are produced for broad customer base.
• Strict attention is given to product controls and budgets.
• There is little product differentiation.
• More importance is given on improving the productivity.
• Tries to understand the need of the specific market of
consumers and creates a product that will attract the
customers.

17. DIFFERENTIATION
STRATEGY
• It is adopted to offer products which are
unique.
• The organization makes effort to create
brand loyalty.
• Gives organization advantage over its
competitors .
• Offers products that create value to
customers.

18. LOW-COST FOCUS
STRATEGY
• Similar to Cost Leadership Strategy except
that it focuses on niche market.
• Product is not marketed to the entire market
but to a particular segment of consumers.
• The focus is to provide goods at lower rate
to that particular segment.

19. DIFFERENTIAL FOCUS
STRATEGY
• Also focuses on a particular segment of
consumers like the low-cost strategy.
• The product is marketed as being unique in
some way, to a particular segment.
• In this strategy, the organization offers
something unique to the customers in the
niche market.