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Generic building blocks of sustainable competitive advantage
The document discusses sustainable competitive advantage through several examples of companies that have maintained competitive advantages for many years. It provides details on the competitive advantages that have allowed Coca-Cola and Walmart to specifically sustain higher profits than competitors over long periods of time. Coca-Cola's sustainable advantages include its secret recipe, continuous new product development, extensive global distribution system, and high production efficiency. Walmart maintains its advantage through a complex distribution center network that enables faster and more efficient delivery of goods at lower prices than competitors.
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Introduction to competitive advantage; firms earn higher profits in competition.
Examples of firms like Dell, Gillette, Apple, and others innovating for competitive advantage.
Discusses the evolutionary process of competitive advantage.
Identifies cost and differentiation as main types of competitive advantage.
Competitive advantages can erode through competition via imitation and innovation.
Describes characteristics of sustainable competitive advantage: durable, valuable, unique.
Focus on maintaining higher profits over long periods as key to sustaining competitive advantage.
Coca-Cola's model exemplifies sustainable advantage through innovation, branding, and distribution.
Key historical milestones of Coca-Cola from creation to global presence and sales statistics.
2012 financial figures: Enterprise Value, GDP comparison, product range, and employee stats.
Walmart's detailed distribution strategy provides a significant gap in performance versus competitors.
Wraps up the presentation with a thank you note.
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Generic building blocks of sustainable competitive advantage
- 1. Tirthankar Sutradhar Generic BuildingBlocks of Sustainable Competitive Advantage
- 2. When two ormore firms compete within the same market, one firm possesses a competitive advantage over its rivals when it earns (or has the potential to earn) a persistently higher rate of profits
- 3. Pruning the portfolio •Dell became really successful by exploring the web as a distribution channel. • Gillette has made a fortune by establishing a continuous relationship with customers based on its disposable razors. • Apple resurged based on its core capacity of bringing design to computers and electronic gadgets. • Cisco became famous for its capacity of configuring activities in new and innovative supply chains. • Intel thrived for its capacity to get partners to build on its processing platform. • Google tapped in an innovative revenue streams by linking highly specific search results and content with text ads. • Wal-Mart became dominant by its ability to slash cost throughout its business model.
- 4. Evolution of CompetitiveAdvantage
- 5. Emergence of CompetitiveAdvantage
- 6. 4 Building Blocksof Competitive Advantage
- 7. The Main Typesof Competitive Advantage Cost advantage Differentiation advantage Competitive advantage
- 8. Once establishes, competitiveadvantage is eroded by competition. The speed with which competitive advantage is undermined depends on the ability of competitors to challenge either by imitation or innovation
- 9. Sustainable Competitive Advantage Whatis meant by sustainable competitive advantage? • Durable • Valuable to the firm • Exploiting weaknesses and neutralizing threats • Unique • Difficult for competitors to imitate • Not easily substitutable
- 10. Sustaining Competitive Advantage Sustainedcompetitive advantage comes from maintaining higher profits than competitors over long periods of time.
- 11. The Coca-Cola BusinessModel • Coca Cola is the best example of a company with sustained competitive advantage, innovation, an extensive business model and an intelligent and substantial distribution network. • The Coca-Cola Company was incorporated in 1892 to produce the sweet fizzy drink – first developed by a pharmacist – that has become the world’s most recognised brand. • Today, almost 120 years later, The Coca-Cola Company is still going strong and is one of the most sought-after stocks on the New York Stock Exchange. • Coca-Cola’s competitive advantage has proven its sustainability over the last 100 years.
- 12. Competitive Advantage ofCoca-Cola • The secret recipe for Coca-Cola, which arguably tastes better than other cola drinks. • Their ability to continue developing new products and re-inventing old ones – Coca-Cola currently offers over 400 brands in 200 markets worldwide. • The world’s most comprehensive distribution system has made Coca-Cola accessible to billions of people worldwide. Coca-Cola is often available in ample supply to people in areas where other consumer goods companies would never consider delivering their products. The African continent is an excellent example – it’s fairly common to see a small shop selling cold Coke in the middle of nowhere. • Coca-Cola’s production techniques are so well developed that it costs a fraction of the selling price to manufacture their product, resulting in high profit margins.
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- 15. 1886 Coca Cola BORN 1891 Coca Cola’sfirst BOTTLINGIn a drug store occurred
- 16. 1899 The first bottling wasdone AGREEMENT 1909 400 Coca-Cola plants were operating BOTTLING
- 17. 1930 The company startedmoving GLOBALY 1960 New BRANDS were Introduced
- 18. And the restis History
- 19. Coca-Cola was madefor the cure of headache and other illnesses
- 20. Sales for thefirst year were only $50
- 21. Only 9 servings ofthe soft drink were sold each day
- 22. Now number ofcoke bottles sold each day 1.8 billion
- 23. is the Coca-Cola most recognizedword in Okay the world after
- 24. 162 B 115B In 2012 Enterprise Value In 2012 Total GDP
- 25. Total number ofCoca-Cola Products 3,500
- 26. Number of worldwideCoke employees 150,900
- 27. Pruning the portfolio Performance Distribution Network Anotherwell-known example of a company with a sustainable competitive advantage is Walmart
- 28. Competitive Advantage of Walmartmaintains a sustainable competitive advantage in part because its strategies are specific to its organization and these strategies are known for creating a gap between Walmart's performance and that of its competitors. Walmart has created a complicated and detailed distribution center network which allows it to move goods to stores more quickly and efficiently than its competitors, while maintaining prices lower than its competitors.
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Editor's Notes
- #16 Coca-Cola® originated as a soda fountain beverage in 1886 selling for five cents a glass.. Coca-Cola recipe was formulated at the Eagle Drug and Chemical Company, a drugstore in columbus, Georgia by John Pemberton. The first bottling of Coca-Cola occurred in Vicksburg, Mississippi, at the Biedenharn Candy Company in 1891.Joseph A. Biedenharn Biedenharn Candy Company
- #17 HISTORY OF BOTTLING1894 … A modest start for a bold idea In a candy store in Vicksburg, Mississippi, , Joseph 1899 … The first bottling agreement 1900-1909 … Rapid growth The three pioneer bottlers divided the country into territories and sold bottling rights to local entrepreneurs. By 1909, nearly 400 Coca-Cola bottling plants were operating, most of them family-owned businesses.
- #18 1920s and 30s … International expansion Company began a major push to establish bottling operations outside the U.S. Plants were opened in France, Guatemala, Honduras, Mexico, Belgium, Italy, Peru, Spain, Australia and South Africa. By the time World War II began, Coca-Cola was being bottled in 44 countries.