MORE ON COMPETITIVE ADVANTAGE

As I mentioned in my previous post a business core competencies creates its competitive advantage. A competitive advantage enables a business to offer its customers better value than its competitors. The competitive advantage is sustainable depending on how difficult it is for the competitors to imitate. The ability to imitate a competitive advantage may difficult if the business in question has been in existence for a long time.
Take for example the Coca-Cola Company, it has been there for years, it has developed an effective distribution system and has created trustworthy partnership with its distributors and if one was to start manufacturing soft drink, then he or she would need to have their own such an effective distribution channels to compete effectively. For Coca-Cola the effective distribution is part of its competitive advantage. However with today’s technology, a new business may strategically use internet to create a pool of affiliate marketers thus leapfrogging Coca-Cola.
However Coca-Cola has many defense mechanism to protect its competitive advantage, First Coca-Cola may opt to block its competitors by patenting its distribution system or even threaten legal action to whoever tries to copy its distribution model. However such a move could only keep other business away from the Coca-Cola competitive advantage for a matter of time. Besides the consumers behavior could change to buying everything from the internet thus rendering the Coca-Cola distribution system obsolete. It may buy time blocking the competition but eventually they will catch up. The block strategy, Coca-Cola may opt to erect barriers around its business model by making their offer distinct and different from other offers in the market thus offering the consumers a unique value and then block the competitors by introducing better margins to its distributors. This blocking strategy bear fruits only if the product line is so distinct and different from what the competitor offers the market.
Because of the shortcomings of the block strategy above, Coca-Cola may decide to use a run strategy, this means that Coca-Cola will keep coming with new competitive advantage and every time the competitors catch up Coca-Cola is ahead. This has been the case of Apple, they first came up with Macintosh computers which were easier to use. By the time the competitors caught up with them, they had moved ahead with the IPod, then IPhone and latest IPad. This strategy calls for business to be always identifying new consumers needs and moving ahead to provide new products.
Coca-Cola may also opt to use team up strategy; that is team up with online merchants to extend its products online. This way, its consumers can either buy from Coca-Cola brick and mortar infrastructure or from its internet based business.
The best way for a business to operate is to use the above three strategies in order to maintain the competitive advantage.