Competitive Advantage Mnes New Organizational Term Paper
- Length: 11 pages
- Subject: Business
- Type: Term Paper
- Paper: #36531372
Excerpt from Term Paper :
Marks & Spencer further has quality food products that are perishables such as salads and vegetables. This is complex and requires accurate and fast delivery to the UK food stores.
The work entitled: "Keeping Real Time Tabs on Fresh Food Supply Helps Guarantee the quality of Perishable Products" cites the statement of the Head of Supply Chain Logistics and it at Marks and Spencer who states that in order to stay ahead of the competitors Marks & Spencer's management has been expedient and efficient in identification of the potential benefits of RFID (radio frequency identification) for improving the supply chain in fresh food. According to Gary Pile General Manager of Melrow Salads: "Once Marks & Spencer decided to move ahead with RFID, we took the opportunity to work with them. RFID brings real benefits in improving our operational efficiency, giving us constant detailed feedback on our performance. That enables us to optimize the supply chain and move even closer to our target of 100% compliance." (Case Study Marks & Spencer, 2005)
The Case Study on Marks & Spencer states that the company is one of the largest retailers in the UK with 65,000 employees in over 450 stores and with a network of 198 franchised stores in 30 territories worldwide. The total sale for the Mark & Spencer group in 2005 was £7.8billion. RFID technology is being used by Marks & Spencer in tracking the movement of their products. The tag (a mobile device) transmits data which is read by a RFID reader and then the data is processed depending on the specific application and its' associated needs. The technology tool used by Marks & Spencer is the "Half Portal Writing Solution" which is comprised of a 'Controller Station' (houses the portal electronics) a touch screen and a choice between "tethered readers or handhelds." (Ibid) the configuration is easily accomplished with just a few keystrokes and can easier program multiple tags at one time.
IV. Johnson & Johnson
Johnson & Johnson are one corporation that is stated to use the factor of social partnering to sustain their competitive advantage. Company products are sold in countries totaling more than 175 with an annual revenue generated globally in excess of $36 billion. The products produced and sold by Johnson & Johnson meet a wide range of needs for human healthcare and include: anti-infectives, orthopaedics, cardiology and circulatory diseases, urology, diagnostics, women's health, mental health, skin care and many more. Johnson & Johnson states that their "unique organization structure allows us to effectively support our business strategy of remaining the worlds' most comprehensive and broadly-based healthcare company." Johnson & Johnson forms 37 global affiliates with 200 operating units. Johnson & Johnson has certainly managed a competitive advantage in the area of customer loyalty. Johnson & Johnson has "over time, and through a variety of means. Built customer loyalty to the products convincing the customers that its products are 'safe'. Johnson & Johnson backs this by removing, immediately from the market, any product proven to be unsafe. One example of this is the Chicago 'Tylenol' case and while "experts - predicted the death of Tylenol because they reasoned that Johnson & Johnson's recall was an admission of guilt, three months later Johnson & Johnson reintroduced the product, showed how the company had eliminated the possibility of tampering, demonstrated the product was safe again and traded on the user's loyalty to regain sales." (Robert, 2006) Reports state that six months later the product was reintroduced with safety tampering features and the customers again trusted Johnson & Johnson and the Tylenol product.
While both the companies of Johnson & Johnson and Marks & Spencer have been witness to being 'up' and 'down' in the marketplace, what these two companies have is determination to keep their customers and to gain new customers in what is termed a competitive advantage over other companies with similar products. In the work entitled: "Leading in (and out of) Adversity" the authors Vinay Couto, James O'Toole, and Alec Levenson (2002) reported is a 2001 case study conducted by the Center for Effective Organizations and Booz Allen Hamilton research through administering surveys to a sampling composed of 36 Fortune 500 Companies in order to assess how' worsening economic conditions" were affecting the companies and what the leaders were doing to combat the economic downturn. Stated in the report in relation to Organizational Evolution that "As the industry goes through its first major cycles, the survivors learn: How to ride out the demand fluctuations and build competitive advantage; and How to predict when future downturns will occur." The emphasis should be on both "efficiency and revenue growth at the same time" and should be "extremely tenacious when dealing with competition attacking with distributions channels or sales, and quality and productivity operations simultaneously. A study was conducted by these authors states that 48.1% of companies are experiencing decreased sales and increased competition.
A states that 51.4% of companies interviewed state they are "expanding operations in order to take advantage of the weaknesses of their competitors. When asked to what extent these companies are expanding operations in order to take advantage of their competitors answers were given as follows:
1=Not at all ranging to 7 = great extent
Overall companies report that they are not making any changes from a year ago with 27.3% reporting no change, 6.1% reporting they are more analytical and the rest of the respondents spread out in between the two poles. When asked to rank the priorities of the leadership team in terms of 'current' priorities the following was stated:
Sales growth 60.0%
Cost Containment/headcount reduction 46.7%
Gaining market share 56.7%
New Product introductions 53.3%
Building strategic alliances 43.3%
Brand Management 26.7%
Boosting margins/bottom line 13.3%
When asked what the company priorities were a year ago stated was as follows:
Sales growth 53.3%
Cost Containment/headcount reduction 53.3%
Gaining market share 43.3%
New Product introductions 56.7%
Building strategic alliances 33.3%
Brand Management 20.0%
Boosting margins/bottom line 40.0%
It is seen that in today's market cost containment, boosting margin and new product introductions are not as important as in years previous however gaining market share, building strategic alliances, managing the brand and sales growth are more important than previously.
Competitive advantage may be realized in many various methods and areas relating to a companies products and services, and generally is due to what specifically makes the company, its' products or its' services unique or different from that offered by other similar companies. In the case of Johnson & Johnson, the trust of consumers is an overwhelming competitive advantage particularly with a name as old as the Johnson & Johnson name. In the case of Marks & Spencer, this company has been customer-centric and remains focused toward the customer's preference in all divisions of its products. The competitive advantage of Marks & Spencer has been realized through its' unique integration of manufacturing and retailing in addressing the needs of the customer. The only sure thing in the global business environment is change however, like Johnson & Johnson, the companies must learn to 'keep; what is valuable and recreate what will give their company the new competitive advantage in the globalized economy of today's marketplace.
Couto, Vinay; O'Toole, James; and Levenson, Alec (2002) Leading in (and out of) Adversity. Center for Effective Organizations. Online available at:
Robert, Michael (2006) Product Innovation Strategy, Pure and simple: How Winning Companies Outpace their Competitors. Online available at http://books.google.com/books?id=t0BfAyjHeo8C&pg=PA99&lpg=PA99&dq=johnson+%26+johnson+competitive+advantage&source=web&ots=dfpqTLBU0f&sig=QFJD5OWC7fIbGHCqmETH8h5O8rU#PPP1,M1
Porter, M. "The competitive advantage of Nations. Harvard Business Review, March-April 1990: 73-91.
Porter, M. "How Competitive Forces Shape Strategy," Harvard Business Review, March-April 1979.
North, D. Institutions, Institutional Change and Economic Performance, Cambridge University Press, 1990.
Brandenburger, a.M. And Nalebuff, B.J. "The Right Game: Use Game Theory to Shape Strategy: Harvard Business Review (July/August 1995) 57-71.
Johnson & Johnson (2006) Wharton Business Plan Competition. Online available at http://bpc.wharton.upenn.edu/about/sponsors.html
Conklin, David W.(2003) Designing a New Course: The Global Environment of Business. Journal of International Business Education 1(1), 00-00. 2003 Senate Hall Academic Publishing.
Chapter 03: Buyer Behavior and Relationship Development (2001) Additional Case Study Relationships Don't Always Help Marks and Spencer to Sparkle. Online available at http://www.oup.com/uk/orc/bin/9780199266272/01student/case_qs/csch03.doc.
Case Study: Marks and Spencer (2006)Keeping real time tabs on fresh food supply helps guarantee the quality of perishable products. Online available at http://www.auto-id.bt.com/docs/pdf/M-S_fresh_food.pdf.
New Organizational Strategies and Structures for Competitive Advantage
Complementing within industry or market
Tactics - Perceptions