Competitive Strategy

My big win of the pre-term auction was Competitive Strategy, taught by Nicolaj Siggelkow (the professor who delivered our convocation address). It was a fascinating lecture on the nature of business competition. The 10 key factors currently affecting competition, according to Siggelkow, are:




1. Supply of natural resources
2. Speed of globalization
3. Trust in large corporations
4. Role of government
5. Consumption around the world
6. Growth of Asia
7. Speed of innovation
8. Future price stability
9. Aging population
10. Trust in models

We discussed a few interesting case studies. The first one was about the car industry and Toyota. Toyota has the most efficient manufacturing processes and Ford (or was it Chrysler) had tried everything to replicate Toyota's efficiency in their own plants. They failed, and eventually installed Toyota managers into one of their plants in exchange for helping Toyota sell into the American market. The lesson here was that it was the tactics used by the Japanese managers that did the trick.

The second case study though was Southwest. Southwest is incredibly successful through it's low cost, efficient model. Other airlines tried to copy Southwest by forming their own low cost subsidiary airlines, but were unsuccessful. The lesson from this case was that it's not 1 particular thing that creates a sustainable competitive advantage - it's about the system. And the system is harder to replicate.