Competitive Edge Management Skills Essay Sample

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Introduction of TOPIC

  1. Introduction

Competition in the market place arises as soon as you have more than one seller for a product or a service. Business today is intensely competitive and competitive strategy is handled and decided at the highest echelons in an organization.

The primary determinant of the level of competition in a market is the number of competing business firms and the ease of entry and exit of firms into and out of that market. Some product markets have few barriers to entry and many competing firms. Others have significant barriers and, consequently, few competing firms. Common barriers to entry include specialized knowledge or skills, patents or copyrights, high start-up costs, extreme risk or government regulations. “Powerful competitors and rapid technological change have made the quest for competitive advantage more difficult and its accomplishment less sustainable” (Lyon, and Ferrier)

Enormous and sustained thought and skills are being put in by business organizations into analyzing what is required by customers as also how to deliver it to them satisfactorily to obtain competitive advantage. “Customers want more of everything they value. If they value low cost they want it lower. If they value convenience, they want it easier and faster. If they look for state of the art, they want it first and want to push the envelope. If they need expert advice they want more time and dedicated effort and investment.” (Sidorowicz, R 1) As such fiercely competitive organizations are incessantly increasing customer expectations trying to push customers out of business.

In this scenario what does a company do and how does it respond to competitive challenges in the marketplace?

Companies adopt various ways to become more competitive. “Companies that face the same opportunities and challenges often respond to them in different ways, depending on their competitive strategic posture” (Zahra) Some companies simply focus on operational excellence and strive to offer quality, price and ease of purchase. They concentrate on execution and guarantee standardized products and services at low prices.

Innovation does not really figure in their business strategy and they give attention to delivering existing products and services properly. Others concentrate on knowing the customer intimately and work on close and long term relationships. They create dependency of customized service and support, thus focusing on customer retention and satisfaction. Again other companies depend upon innovation and keep on developing products and introducing new services, thus making the competition obsolete.

This essay takes up two key issues, product planning, quality management, and their importance in the marketing of products and services, in the management of competition and in developing a vital competitive edge.

  1. Product Planning

Product Planning is primarily a company function responsible for dealing with the continuous management of products or groups of products at all stages of the life of the product.

Product management can be divided into two sections, internal and external, which can also be referred as product planning and product marketing. Together these two disciplines are responsible for deciding upon and bringing new products to the market through a host of activities which inter alia include defining products, gathering product requirements, arriving at business requirements from the products, management of product costs, organizing internal resources, laying down internal product specifications and selling the product across the company through departments and externally with the customers, media and associates, dealers and partners. It also includes product differentiation, lifecycle planning and management of the product portfolio.

Product planning enables companies to decide the best use of resources for technology and product development to create both short-term and long-term competitive advantages. Planning ensures that the right products are developed; development ensures that development is done properly; validation makes certain that products hit the design targets, and product launch ensures optimal benefits from the effort.

It takes into account the understanding of products in the market and adds understanding and analysis of current and future market and technology trends. Market segmentation can show where the company should direct its efforts towards the greatest opportunities. Prioritization of customer needs reveals where the company can apply its technology resources to solve compelling customer problems.

Product planning and development includes the process of bringing a new or substantially altered product into the market.

“The product planning process is one of the most controversial within any company. Everyone wants a hand in new product definition and almost everyone will have contributions that will make a new product successful.”

Competent product planning and development is obviously the bedrock for obtaining competitive advantage in the market. It involves product engineering, marketing research and analysis and is the preliminary phase of the life cycle of a product. Products can be new in entirety or new to the firm; again, they may arise through minor modifications of existing products or out of brilliant innovation.

Once product ideas are generated, be they from predictable sources like customers, other competitors or in-house research or through idea generating techniques like problem analysis or prototyping, they are screened to eliminate illogicalities and assessed for market benefit, technical feasibility and commercial viability.

The concept is then further developed taking account of product benefits, likely customer response and cost of production and then sample tested for customer feedback. Once the product is approved, market requirements are refined and detail on the desired features of the product, and how customers will use it, is laid down.

This is followed by a hardheaded business analysis, incorporating sales prices, likely volumes, BE points and profitability before it is given over for Beta testing, technical implementation and commercialization, including legal, copyright or patent production. The product development exercise also considers price, quality, compatibility with existing products and distribution requirements.

Often new products are mere modifications, changes being necessitated by competitive imperatives. These changes could be cosmetic, for example packaging or could involve modification of style, features or quality. Nevertheless, companies use product planning, development and modification continuously as integral to their business strategy.

The following table is an attempt to simplify and phase out the various stages in a product planning exercise. The steps are important because they allow you to gather input from all possible resources, evaluate the potential of each idea and gather input from all involved parties.

Phase 1 Phase 2 Phase 3 Phase 4 Phase5
Input Ideas Approved Ideas Market Requirements Development




Research and


Idea 1

Idea 2

Idea 3

Idea 4

Idea 5

Product A from Idea 1


Product B from Idea 4

Market Requirements for Product A

Market Requirement for Product B


Tech Specs and Functional Requirements for Product A

Tech Specs and Functional Requirements for Product B

It has also become evident that competitive advantage is heightened if product planning is able to have an organizational framework that can bring ideas faster to market than the competition. “A number of studies showed that roughly half of all new product development investments resulted in products that failed. It became clear that time-to-market is more financially important than all other considerations in launching successful new products for most companies” (Goldense, B. L., 1)

Researchers also concluded that true competitive advantage can be optimized if a multi disciplinary team works concurrently on product development during the initial stages of the project to consistently obtain better results and avoid failure in the market place. However, we also have pragmatic voices of caution, which state, “In the rush to achieve rapid time-to-market, short-cuts are often taken with the product definition phase. The result is a product that is off target or additional time spent with subsequent requirements definition and redesign iteration. To be successful, a comprehensive, well-defined, continuous process is needed. The starting point is a product plan, which defines markets so that proper customer needs can be captured.” (Crow, K)

Effective product planning requires a multidisciplinary effort. Sales and Marketing teams determine the impact of various products in the market and in forecasting of needs, which will need to be met. Production and engineering people provide valuable inputs about product performance and risks, finance people are very useful in working out the financial

implications of the exercise, the BEPs, and the profitability projections.

justify;">No discourse on product planning is complete without a discussion on product life cycle and its proper management to achieve competitive advantage. Every product has a life cycle, which comprises of development, introduction into the market, growth, maturity and stability to be followed by decline.

Products have variable life cycles. Some reach maturity fast and others take time. Companies try their best to increase the maturity and stability periods in order to maximize returns from the investment companies make in development of new products. Microsoft even releases the dates at which products will be discontinued or unsupported even before the products are released. Product planning is integral to all stages of the product life cycle and contributes to the success of the product by ensuring speed and responsiveness to the demands of the customers.

  1. Quality Management

The goal in business is to make a profit and in most situations, several companies compete for sales and market share. This competition can range from performance competition, where each company does its best to win the hearts and minds of the customers, to a head-to-head competition, where a company will not only seek to do better than its opponents but will also try to prevent the competition from performing well. The importance of achieving excellent quality and reinforcing it in customer mind space is an important way to leave the competition behind or catch up with it, as the case may be.

Looking at the issue from another angle “Ultimately, poor quality holds down the price companies can charge for their goods and services. Losing just one unhappy customer costs as much as five times the annual value of that customer’s account. American businesses now realize that consumers want better quality and that they are willing to pay for it.”  (Brown 1)

Most businesses preach quality. It is extolled in advertising, product and service write-ups and is an integral part of any product differentiation exercise. While there are experts who feel that most organizations keep quality on the backburner, “Think about the businesses you know that preach quality and outstanding customer service, but make their customers jump through hoops to get it.” (Rothfeld, D 1), in most cases, it is simply not true and used to draw attention to their articles by the writers.

Most organizations in the competitive world are now fanatical about quality. They know there is no escape and a connotation of poor quality is the surest route to business disaster, more so where numerous low cost production and service centers in China, India, Brazil and South Africa are able to provide goods and services of adequate and improving quality at much lesser costs. The issue probably lies not in inculcating a culture of quality but of informing the market convincingly about the organization’s total commitment to quality at all times as an undeniable fact and not as an advertising or public relations exercise.

“Total Quality Management is a set of management practices throughout the organization, geared to ensure the organization consistently meets or exceeds customer requirements. TQM places strong focus on process measurement and controls as means of continuous improvement.” (McNamara, C) A good Quality Management system outlines policies and procedures that are required to maintain, constantly improve, and control the various manufacturing and service practices and processes that that lead to product and service quality.

While the importance of maintaining and improving quality is a sine qua non, its’ imperativeness is sometimes lost on smaller organizations and start-ups who have to wrestle with a number of problems and are overstretched vis a vis costs. The feeling in such organizations centers on the assumption that the “owners’ eyes” and their commitment to organizational success will substitute an organized quality control system. This hypothesis is mostly fallacious and it has been proved repeatedly that quality failures rank very high on the list of reasons of failures in small organizations and start-up companies.

The concept of quality evolved in history from the pride an artisan, sculptor or artist took in his work and the appreciation the populace gave to his eye for detail or in his fastidiousness for his product. Even then, the relationship between quality and the respect it drew from the general population was as clear as water.

The standardization of quality, as an integral business practice, evolved from the application of inspection, measurement and testing many years ago. The movement got a fillip in during the war when the effects of bad quality practices in the manufacture of weaponry or ammunition were brought home with chilling finality. The practice grew through the last fifty years and is now viewed as an integral business practice, buttressed by many evolving quality standards like ISO, BS, six sigma, FDA approval and HACCP practices.

The Quality Management principle developed by using the ISO TC176 on Quality Management and Quality Assurance consensus process states that it is a comprehensive and fundamental rule or belief, for leading and operating an organization, aimed at continually improving performance over the long term by focusing on customers while addressing the needs of all stakeholders.

It is no surprise that the various quality standards achieved or practices followed by an organization are flaunted on organizational websites and literature as proof of its commitment to quality and critical importance in the eyes of the customer. The Malcolm Bridges Quality Award is among the most prestigious awards in the US and addresses a range of quality criteria, including commercial success and leadership.  The Ritz Carlton, the only hotel chain to win the award twice in the hospitality sector refers to it incessantly in all its communication as proof of its pre-eminent position in the industry.

The application of Total Quality Management principles have now moved from the factory shop floor into improving sales and marketing. This is a recent initiative and is beginning to get very discernible results. Sales organizations are traditionally managed for results and not process. The operation involves soft skills and relationship building. Communication is key to the whole process.

Quality Management principles can increase the effectiveness of the sales department by understanding the tactical requirements of prospecting, qualifying, proposing and closing business. There are a number of areas in which improvements are possible, starting from lead generation and moving to succeeding phases of the process.

However, the QM initiative in sales must look at process and results; improvements in process must result in better results, akin to reduction of defects in a production plant. Initiation of a QM program in the sales function generally raises sales results in the short term because of increase in consistency of sales practice. Simple measurement of behavior can lead to improvement in results, improvement in customer profile and reduced wastage of time.

  1. Conclusion

Both Product Planning and Quality Management are important essentials of a company’s marketing effort, in gaining vital competitive advantages, enabling companies to pull away from the competition and establish positions of leadership.

Product planning is of course one of the pillars of an organization’s business strategy. It enables an organization to shortlist and decide upon a product or service and through various operational phases, involving inputs from cross-functional and multidisciplinary sources, work towards creating a product in tune with the customers’ aspirations and needs. As an integral part of the product management process, it overlaps, relates strongly with product differentiation, product development, and is a major influencer of the product life cycle. It is a key mover of the company’s marketing effort and by virtue of being the operating influence behind the planned journey of the company’s product to the market in the shortest possible time and at the best possible cost plays a critical role in its’ strategy to gain competitive advantage.

It would not be wrong to state that poor product planning is a causal factor behind most instances of product rejection by customers with its adverse effects on the company’s costs, profitability, competitive advantage and finally business strategy. The reverse is also, fortunately very true and proper, thought out product planning serves as the acme of the company’s marketing effort, generating value and establishing superiority in the market place.

“Total Quality is a description of the culture, attitude and organization of a company that strives to provide customers with products and services that satisfy their needs. The culture requires quality in all aspects of the company’s operations, with processes being done right the first time and defects and waste eradicated from operations.” (Padhi, N) Good Quality Management practices help enormously in today’s intensely competitive market place where companies jockey for every bit of competitive advantage and perceptible differentiation in customer opinion.

Of all things available, customers look for a value deal, a combination of superior quality and economic cost. Most customers are very sharp; they are able to make out the difference between substance and glibness and are able to read behind the mask, the promotions, and the clever talk to arrive at the essence of an offering. It is not possible to find a single product or service with poor quality existing in any but severely monopolistic markets. Every organization thus gives maximum space in its’ customer communication to only these two product/ service features, quality and cost.

There are a number of quality standards in use today, the most well known of which is the ISO series, continuously updated, augmented and modified to accommodate the demands of changing times. It has become imperative for any commercial organization wishing to be considered seriously to accept and obtain approval of the applicable quality standard regulators.

Quality Management practices, by facilitating the production of consistently excellent quality reinforce the image of product superiority and reliability in the eyes of the customer and act as veritable force multipliers, pushing sales just by being there.

Works Cited

Brown, C “Quality Pays Off.” Black Enterprise June 1992: 281+. Questia. 17 July 2006 <>.

Crow, K, “Product Definition”, 2002, DRM Associates, 18 July 2006, <>

Goldense, B.L., “Speeding Time to Market,”1996, 15 July 2006,

Lyon, D. W., and Walter J. Ferrier. “Enhancing Performance with Product-Market Innovation: The Influence of the Top Management Team.” Journal of Managerial Issues 14.4 (2002): 452+. Questia. 17 July 2006 <>.

McNamara, C., “Quality Management” 1998, 18 July 2006

Padhi, N “The Eight Elements of TQM’, 2006, Six Sigma, 18 July 2006,  <>

Rothfeld, D, “Separate yourself from your competition by proving your quality” 23 June 2006, Orlando Business Journal, 16 July 2006, <>

Sidorowicz, R, “Competitive Strategies – The discipline of Market Leaders” 2006, The CEO Refresher, 15 July 2006,

The Production Planning Process, 2006, Infrasystems LLC, 15 July 2006,   <>

Zahra, S. A. “New Product Innovation in Established Companies: Associations with Industry and Strategy Variables.” Entrepreneurship: Theory and Practice 18.2 (1993): 47+. Questia. 17 July 2006 <>.


Brown, C “Quality Pays Off.” Black Enterprise June 1992: 281+. Questia. 17 July 2006 <>.

Crow, K, “Product Definition”, 2002, DRM Associates, 18 July 2006, <>

Goldense, B.L., “Speeding Time to Market,”1996, 15 July 2006,

Lyon, D W., and Walter J. Ferrier. “Enhancing Performance with Product-Market Innovation: The Influence of the Top Management Team.” Journal of Managerial Issues 14.4 (2002): 452+. Questia. 17 July 2006 <>.

McNamara, C., “Quality Management” 1998, 18 July 2006

Product Differentiation, 13 July 2006, Wikipedia, 15 July 2006, <>

Rothfeld, D, “Separate yourself from your competition by proving your quality” , 23 June 2006, Orlando Business Journal, <>

Sidorowicz, R, Competitive Strategies – The discipline of Market Leaders, 2006, The CEO Refresher, 15 July 2006, <>

The Production Planning Process, 2006, Infrasystems LLC, 15 July 2006,   <>

Webb, M.J., “Generating support for a sales quality initiative” , 2006, Six Sigma, 15 July 2006, <ttp://>

Zahra, S A. “New Product Innovation in Established Companies: Associations with Industry and Strategy Variables.” Entrepreneurship: Theory and Practice 18.2 (1993): 47+. Questia. 17 July 2006 <>.

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