The document discusses the generic building blocks of competitive advantage. It defines competitive advantage as factors that allow a company to produce goods and services better or more cheaply than rivals. The main generic building blocks are described as superior quality, innovation, efficiency, and customer responsiveness. Producing higher quality products, innovating new products and processes, efficiently transforming inputs to outputs, and being highly responsive to customer needs can provide companies with competitive advantages over their competitors.

1. GENERIC BUILDING BLOCK OF
COMPETITIVE ADVANTAGE

2. WHAT IS COMPETITIVE ADVANTAGE ?
★ Competitive advantage refers to
factors that allow a company to
produce goods and services better or
more cheaply than its rivals.
★ Comparative advantage is a
company’s ability to produce
something more efficiently than a
rival,which leads to greater profile
margins

3. GENERIC BUILDING BLOCKS OF COMPETITIVE
ADVANTAGE:
★ In the modem business scenario, it is highly important for
an organisation to outperform the competitors and for this
the organisation needs to achieve competitive advantage
through efficient utilization of available resources.
★ This will allow the organisation to produce the results
greater than the competitors which in turn will lead to
success.

4. COMPETITIVE
ADVANTAGE
VALUE CREATION
LOW COST
DIFFERENTIATION

5. COMPETITIVE
ADVANTAGE
-LOW COST
-DIFFERENTIATION
SUPERIOR
QUALITY
SUPERIOR
INNOVATION
SUPERIOR
EFFICIENCY
SUPERIOR
CUSTOMER
RESPONSIVENESS

6. SUPERIOR QUALITY:
A Product can be throught of as a
bundle of attributes.the attributes of
many physical products include their
form,features,performance,durability,r
eliability,style and design.

7. SUPERIOR CUSTOMER RESPONSIVENESS:
★ To achieve superior responsiveness
to customers a company must be
able to do a better job than
competitors of identifying and
satisfying its customer needs.
★ Customers will then attribute more
utility to its products and creating a
differentiation based on competitive
advantage.

8. SUPERIOR INNOVATION:
★ Innovation refers to the act of
creating new products or
processes.
★ Product innovation is the
development of products that are
new to the world or have superior
attributes to existing products
★ Process innovation is the
development of the new process
for producing products and
delivering them to customers.

9. SUPERIOR EFFICIENCY:
A business is simple a device for
transforming inputs into outputs are
basic factors of production such as
labour,land,capital,management and
technological know-how.outputs are
the goods and services that the
business produces the simple mesure
of efficiency is the quantity of inputs
that it take to produce a given
output.that is efficiency outputs/inputs.

10. Sources of Competitive Advantage:

11. 1) In Marketing :
● Launching new product,
● Offering low price,
● Larger market share,
● Applying creativity and innovation in
marketing activities,
● Increasing the level of customer
satisfaction,
● More prompt customer service,
● Improving marketing channel,
● Innovative promotional strategies,

12. 2) In Finance :
● Liquidity,
● Assets,
● Gearing,
● Leverage,
● Costs,
● Cash flow,
● Profitability,
● Cost of capital,
● Efficient tax planning,
● Quality of financial
management.

13. 3) In Manufacturing/Operations :
● Improved production capacity,
● Better plant location,
● Better production facilities,
● Post-production facilities,
● Full capacity utilization,
● Efficient utilization of raw materials,
● Maintenance,
● Reduced cost of production,
● Achieving break-even position,

14. 4) In Research & Development :
● Features, quality and depth of research
facilities,
● Proper allocation of financial and other
resources for R&D activities,
● Skills, knowledge and experience of
researchers,
● Promptness in research activities,
● Technical skills and abilities for carrying-out
research and development,

15. 5) In Human Resources :
● Skills, knowledge and
experience of employees,
● Dedication and motivation in
employees,
● Low personnel turnover,
● Minimal labour costs,
● Improved industrial relations.

16. 6) In Corporate Factors and Overall Resources :
● Size of the company,
● Corporate image,
● Capability of management,
● Capable and experienced top level
management,
● Effective strategic planning,
● Productive organisational culture,
● Flexible and adaptable organisational
structure,
● Implementation of latest technology.