Offensive & Defensive Strategies for Competitive Advantage By Group – 5 Mahesh Menon23 Anindita Mukherjee26 Ashwin Patel33 Ajay Nikam30 Deval Trivedi53 Jofy James36

Competitive Scope & Competitive Advantage CostDifferentiation Cost FocusDifferentiation Focus COMPETITIVE ADVANTAGE COMPETITIVE SCOPE LowHigh High Low

Offensive Strategies Pure Spending Reconfiguration RedefinitionReconfiguration and Redefinition Same Chain as Leader New activities New Chain Same as Leader CONFIGURATION OF THE VALUE CHAIN COMPETITIVE SCOPE Different from Leader

Offensive Strategies : Reconfiguration

Offensive Strategies:

When/where to attack?

Barriers to Leader’s Retaliation Mixed Motives Higher Leader response cost Different Financial Priorities Portfolio constraints Regulatory pressure Blind Spots Incorrect Pricing

Conditions for Defense or Divest?? When to Defend : No concerns for short-term profitability Increasing growth rate No Complacency When to Divest?? High competition Reducing profitability

Defensive Strategies

Raising Structural barrier Fill Product or Positioning gaps Block Channel access Raise Buyer’s Switching cost Raise the cost of gaining trial Defensively increase Economies of scale Defensively increase Capital requirements Foreclose alternative technologies

Raising Structural barrier Invest in protecting proprietary know-how Tie-up with suppliers Raise Competitors inputs cost Defensively pursue inter-relationships Encourage gov. policies that raise barriers Form Coalitions Lowering the Inducement for attack Reducing profit targets Managing competitors assumptions

Increase Expected Retaliation Signal Commitment to Defend Signal Incipient Barriers Match Guarantees Raise the penalty of Exit or lost share Accumulate retaliatory resources Encourage good competitors Establish defensive coalitions Disruption of test markets Leapfrogging Litigation

Evaluating defensive tactics Value to buyer Cost asymmetry Sustainability of effect Clarity of the message Credibility Impact on competitors goal Other structural effects Matching by other incumbents

Xerox - copiers Japanese co. identified sizable segment unattended by XEROX In small sized copiers for small sized companies Defender Attacker Indirect Strategy TABLETOP COPIER USING PLAIN PAPER Low price to penetrate market and increase Market share Relevant media- Announcing new product and affordable Office supply dealers Expansion Expanded product line – mid size and large copiers Redifinition & Reconfiguration

Defensive Strategy The fight to regain lost market share is costlier than retaining market share it possesses Reducing Profits Fill Product gaps Coalitions Reducing Profits

Cummins Engines Offensive strategies adopted by Komatsu (Japanese competitors ) Products priced 40% lower Poorly severed and emerging market segment in medium size engines Develop quality product to expand product lines Reconfiguration – Product Changes CUMMINS ENGINES CO. leaders in manufacturing of heavy diesel engine

Cummins Defense

HLL Vs Nirma Market Share YearSurfNirma ,457, PriceSurf : Nirma YearSurfNirmaPrice Ratio ,

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