Discuss about the Competitive Strategy for Modern Management.
In the contemporary business environment, business model innovation can be defined as one of the leading strategic interventions of modern management influencing the business productivity in a positive way. In many business cases, most of the modern corporate businesses have prioritised growth over future sustainability. The referred tutorial video of business model innovation has defined the ways to attain long-term growth in the competitive market. Lack of innovation may have led to unsuccessful business strategies. Therefore, the suitable business model should be formulated so that long-term business sustainability can be achieved. By identifying the need for the target audience, efficient change in business strategies can be adopted leading towards growth (Ebel, Bretschneider and Leimeister, 2016). Moreover, complicated scheduling of management has contributed towards a lack of innovation in the business model. On the other hand, product differentiation and market segmentation can influence the business strategies. Precisely, only technological development cannot be addressed as innovation in business. There are significant strategies that must be admitted to creating value proposition in business. According to the video tutorial, the four-step model can be taken into consideration in developing the innovative business model. The first step can be identified as initiation where the businesses have evaluated their current business model (YouTube, 2013). During ideation step, the comparison of the business model with other models has been drawn. The third step is an integration that identifies the efficiency of the model. Lastly, in the implementing stage, the latest selected business model can be put into action leading towards growth.
Global multinational corporations operating in the target market have utilised the innovative business model to attain sustainability in the developed markets as well as emerging markets. For instance, Unilever Company has defined a well-organised business model so that the company can achieve a commendable competitive edge over the other market participants. By developing subsidiaries in the leading developed as well as developing countries, the corporation has increased its market share (Andries and Debackere, 2013). On the other hand, thorough market research has helped the business to identify the need of the diverse target audience to create a value proposition. The company has established different brand suitable for the target audience. Meanwhile, affordable pricing, customer-oriented products, and competitive growth factors have led sustainability of business. By using the four model of business innovation, Unilever has identified the existing market business model for both the developed and emerging economies. Based on the market investigation, the company has compared the business model to other effective business models to make significant changes. Also, the integration stage has evaluated the efficiency of the business model. By defining sales and profitability figures, the effectiveness of the model can be identified (Linder and Williander, 2015). To finish, a new set of business model can be upgraded according to the trend in the markets. By following the strategies, Unilever has successfully met the requirement of the target demographics creating competitive advantage and brand recognition. Thus, the effectual business model approach has been included in the global business operations of Unilever. Conclusively, the business innovation model has defined new ways for the organisation to become one of the business leaders in the consumer goods manufacturing sector.
CAGE framework can be identified as a major management tool that is used by the firms to measure the diversity of culture and distinction of features between the two countries in which it company operates (Waweru, 2011). The identification of the differences helps the management to plan the strategies according to the need of the market. According to the e-material provided during week five, Pankaj Ghemawat illustrates the utilisation of CAGE framework in modern businesses. According to Pankaj Ghemawat, the CAGE framework can be used by the modern business organizations to identify the differences of factors between the two countries in which the company operates (Ghemawat, 2015). The CAGE framework analysis can be used by the international firms to develop trade policies to seek growth in the overseas market. It helps the international firms to realise the level of trade opportunities available in the specific countries other than the host country to dictate the business terms required for the global exposure of the firm. On the other hand, Ghemawat explained that the word CAGE is an acronym of four words that explains the factors needed to be considered while starting a business in the global market. In the CAGE framework, the letter “C” stands for Culture, “A” represents Administration/Politics, “G” stands for Geographic and “E” stands for Economic factors (Ghemawat, 2015). Hence, the narrator says that if both the countries have similar cultural, share common geographic border, has equal per capita income, and same official language, the opportunity for trade increases by ten to fifteen times as compared to a dissimilar countries. Hence, it is important for an organization to consider the factors explained in the CAGE framework, before choosing a foreign market for the expansion of its business.
In the contemporary business environment, business model innovation can be defined as one of the leading strategic interventions of modern management influencing the business productivity in a positive way. In many business cases, most of the modern corporate businesses have prioritised growth over future sustainability. The referred tutorial video of business model innovation has defined the ways to attain long-term growth in the competitive market. Lack of innovation may have led to unsuccessful business strategies. Therefore, the suitable business model should be formulated so that long-term business sustainability can be achieved. By identifying the need for the target audience, efficient change in business strategies can be adopted leading towards growth (Ebel, Bretschneider and Leimeister, 2016). Moreover, complicated scheduling of management has contributed towards a lack of innovation in the business model. On the other hand, product differentiation and market segmentation can influence the business strategies. Precisely, only technological development cannot be addressed as innovation in business. There are significant strategies that must be admitted to creating value proposition in business. According to the video tutorial, the four-step model can be taken into consideration in developing the innovative business model. The first step can be identified as initiation where the businesses have evaluated their current business model (YouTube, 2013). During ideation step, the comparison of the business model with other models has been drawn. The third step is an integration that identifies the efficiency of the model. Lastly, in the implementing stage, the latest selected business model can be put into action leading towards growth.
Global multinational corporations operating in the target market have utilised the innovative business model to attain sustainability in the developed markets as well as emerging markets. For instance, Unilever Company has defined a well-organised business model so that the company can achieve a commendable competitive edge over the other market participants. By developing subsidiaries in the leading developed as well as developing countries, the corporation has increased its market share (Andries and Debackere, 2013). On the other hand, thorough market research has helped the business to identify the need of the diverse target audience to create a value proposition. The company has established different brand suitable for the target audience. Meanwhile, affordable pricing, customer-oriented products, and competitive growth factors have led sustainability of business. By using the four model of business innovation, Unilever has identified the existing market business model for both the developed and emerging economies. Based on the market investigation, the company has compared the business model to other effective business models to make significant changes. Also, the integration stage has evaluated the efficiency of the business model. By defining sales and profitability figures, the effectiveness of the model can be identified (Linder and Williander, 2015). To finish, a new set of business model can be upgraded according to the trend in the markets. By following the strategies, Unilever has successfully met the requirement of the target demographics creating competitive advantage and brand recognition. Thus, the effectual business model approach has been included in the global business operations of Unilever. Conclusively, the business innovation model has defined new ways for the organisation to become one of the business leaders in the consumer goods manufacturing sector.
CAGE framework can be identified as a major management tool that is used by the firms to measure the diversity of culture and distinction of features between the two countries in which it company operates (Waweru, 2011). The identification of the differences helps the management to plan the strategies according to the need of the market. According to the e-material provided during week five, Pankaj Ghemawat illustrates the utilisation of CAGE framework in modern businesses. According to Pankaj Ghemawat, the CAGE framework can be used by the modern business organizations to identify the differences of factors between the two countries in which the company operates (Ghemawat, 2015). The CAGE framework analysis can be used by the international firms to develop trade policies to seek growth in the overseas market. It helps the international firms to realise the level of trade opportunities available in the specific countries other than the host country to dictate the business terms required for the global exposure of the firm. On the other hand, Ghemawat explained that the word CAGE is an acronym of four words that explains the factors needed to be considered while starting a business in the global market. In the CAGE framework, the letter “C” stands for Culture, “A” represents Administration/Politics, “G” stands for Geographic and “E” stands for Economic factors (Ghemawat, 2015). Hence, the narrator says that if both the countries have similar cultural, share common geographic border, has equal per capita income, and same official language, the opportunity for trade increases by ten to fifteen times as compared to a dissimilar countries. Hence, it is important for an organization to consider the factors explained in the CAGE framework, before choosing a foreign market for the expansion of its business.
By considering the above analysis, it is important for every international organisation to consider the factors of the CAGE framework before planning its global expansion strategy. For example, Unilever is a multinational organisation that deals with consumer goods all across the globe. The company can improvise the CAGE framework in order to seek sustainable growth of business in the foreign market. Precisely, CAGE framework will help the company to identify markets with similar cultural, economic balance, geographical boundaries and political situation that provides better trade opportunities over the international platform (Fahey, 2007). CAGE framework can be used by the Unilever to secure its further market penetration by identifying the opportunities and possibilities in the emerging as well as developed nations (Brookfield, 2013). For instance, Unilever is a Dutch-British company, which will find market similarities in other developed European countries such as France, Spain and Germany. On the other hand, it will be difficult for Unilever to grow its business in the emerging nations like China, India, Indonesia, and Singapore by using the same strategies that are implemented in the developed nations. Conclusively, the CAGE framework helps the organisation to find the most suitable market to grow its businesses and develop international expansion strategy as per the current factors of the target markets.
References
Andries, P. and Debackere, K. (2013). Business Model Innovation: Propositions on the Appropriateness of Different Learning Approaches. Creativity and Innovation Management, 22(4), pp.337-358.
Brookfield, J. (2003). Globalization and competitive advantage. Strategy & Leadership, 31(3).
Ebel, P., Bretschneider, U. and Leimeister, J. (2016). Leveraging virtual business model innovation: a framework for designing business model development tools. Information Systems Journal, 26(5), pp.519-550.
Fahey, L. (2007). Connecting strategy and competitive intelligence: refocusing intelligence to produce critical strategy inputs. Strategy & Leadership, 35(1), pp.4-12.
Ghemawat, P. (2015). Pankaj Ghemawat: CAGE Framework for International Trade – Global Matters. [online] YouTube. Available at: https://www.youtube.com/watch?v=7FpUJaG7uMk [Accessed Apr. 2017].
Linder, M. and Williander, M. (2015). Circular Business Model Innovation: Inherent Uncertainties. Business Strategy and the Environment, 26(2), pp.182-196.
Waweru, M. (2011). Comparative Analysis of Competitive Strategy Implementation. Journal of Management and Strategy, 2(3).
YouTube. (2013). Business Model Innovation. [online] Available at: https://www.youtube.com/watch?v=B4ZSGQW0UMI [Accessed Apr. 2017].
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