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  • Writer's pictureAdil Malia

Competition helps design Business Strategy

The business strategy you adopt is a direct outcome of the competitive activity in the market. There are 5 conditions & reasons for which the market assumes a hyper-competitive character (Porter). These are :

👉 Prevalence of many equal sized competitors of similar strength and power. There is no clear market leader. See the equi-sized boxers in the doodle.

👉 Market growth is slow and everybody is fighting vigorously for a larger share of the market-pie 👉Exit barriers from the business are high. Not easy to walk away because of capital intensive nature of the business..see the poor man chained to barriers in the form of high not easily -monetisable investments

👉Rivals are highly committed to business...each dreaming to emerge as the leader. The man on the winning podium with the red shirt, is the (Dream state) self desire of each participant

👉Firms adopt diverse approaches because they are not able to read competitive strategy being unfamiliar with each other. Most Maverick leaders emerge under these conditions. Your business strategy cannot be unmindful of these changing conditions. COs fail in changing times as they continue to adopt the same steady-state strategies even in changing competitive times. Continue w/o change at your peril.

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