My learning experience from the 2 Essential readings ie Michael porter Strategy & The core competency of an organization :

So what is strategy in the words of , Sir , Michael Porter : Strategy is the creation of Unique and Valuable position , involving a different set of activities ( From the competitors)

In my words , Strategy is an art that makes us more unified and different by N number of times among the pool of diversed students . In a company a strategy is considered as a backbone for them so that at the end of a day they should set standards for the competitors to think and reinvent for the same . If a company is well adapted with their strategies than it gives us an indication of essence which is evident in their strategic intent to work and venture into the top position , so that if any league is going to be announced among competitors then they are the one to declare it first in real by setting standards for them juss like a US army is currently working on building the high end prototypes in order to pump more crusader involvement in the mindsets of others emerging economies . Now what is operational effectiveness : Operational effectiveness means performing similar task better than your competitors In my words Operational effectiveness is all about delivering the best at lower cost and this term is basically originated from the new concept of marketing ie customer orientation means operational effectiveness Lets take an example of software industry and there are 2 rivals who always fight for the notch perfection , one is Microsoft and the other is Oracle and they always compete one another by fraction of their milliseconds execution . It sounds strange because Microsoft is very much visible in the world and ofcourse why not , as far as we are concerned that Microsoft was the only savant who has introduced high end software applications and other utilities across the globe but in today's context Oracle product OPEN OFFICE ORG. is widely accepted than Microsoft MS OFFICE by the corporates and young IT professionals . So this is how an Oracle is defining its operational effectiveness in terms of maximum market concentration in the Techno Market . No what do we understand from the term Core competency Well It is a very deep proficiency of how company enables themselves to deliver a unique value to customers . It cultivates a company's collective learning under the same cocoon that is of how to expand and coordinate its diverse operational skills and also to Integrate multiple technologies . Such a core competency enables a competitive advantage for any company and also it helps in nurturing its expansion into wide variety of related markets . If a company has its core competency in brief than it would automatically create a sustainability in terms of benefits when at the time of offering their products to customers . In my words core competency is like a litmus paper which I have seen during my schooling in the Science chemical lab , Let me give you an insight about it and I am relating it with the concept of core competency , Well this is how It works and If the color comes pink in the green litmus paper then it will not look same as the base color green and if the color comes green in the pink litmus paper then again it will not look same again as the base color so in the bottom line It's hard for competitors to copy or procure. Understanding Core Competencies allows companies to invest in the strengths that differentiate them and set strategies that unify their entire organization .

 Michael porter has defined strategies as Generic which is further categorized as : Variety based positioning : When a company showcased its specialized expertise in producing a subset of products or services . Lets take an example of Global music industry where a music industry is divided into different categories of music ie Trance , rock , cultural , Indie rock, Reggae , Hip Hop etc . Indian music is well recognized and considered as one of the richest cultural music worldwide , if you want to hear your Inner-soul then Indian Spritual music is much more ahead in it . So India is specialized in Rich cultural music worldwide which comes under the term Variety based positioning in the Global Music Industry .

Needs-based positioning : When a company applies their available inputs to practice upon the target segments of customers is known as need based positioning . Lets take an example of Tata motors in the automotive Industry , Recently they have launched their Super mini hatch Tata Nano in the market for the lower income groups or young college students who are not earning huge but they actually wanted to accommodate themselves with the desired needs and one can say that a conservative living lifestyle that each mango people wants to attain in a life . So tata motors have targeted a particular segment of consumers and also positioned Nano as a common man dream car .

Access based positioning : When a company target customers who need different activities to reach them is known as Access-based positioning . Lets take an example of German car maker Volkswagen India , keeping in mind the new year celebration offers carnival in India they have introduced Volkswagen Exclusive breeze edition in their two products named as Vento and Polo under which they have offered GPS(Global Positioning system) under the price band of 6.5 -7.5 lacs which no other car manufacturer is offering in their product segments although no Indian SUV manufacturers have never introduced this feature in their product segments . So this is how Volkswagen India have adopted a concept of Access based positioning in order to tap the concentration ratio of different buyers preferences so that in the near future if any new high end model is going to be launched in India so with the help of this data they can track the product relevance in the market .

Porter's Five Market Forces : A Porter's Five Forces Analysis gives us an Insight about five principal industry factors with the help of which we can determine the attractiveness of any given industry in a given market. In any Porter study analysis one must examine : The Threat of New entrants : In most markets where competition is already defined as a Hyper competition which leads to a productivity frontier situation in the market and under such complex stiff competition it is very much difficult for the new entrants to enter into the market .

 The bargaining power of Buyers/Customers : Porter suggest that in any market there are plethora of options/choices which are available for the buyers which gives them a liberty of bargaining to any extent on any product . The threat of substitute products : It is said that Excess of anything is bad for everything Lets take an example of Chinese products that are very famous in India , from cell phone to ear phones & their products are very much visible all around us , In any college , company , home , temple , church , clubs , monarchs you will find Chinese range of products which as a result create threats to Indian domestic products . The amount of bargaining power suppliers have : It is likely that the suppliers to the manufacturer have considerable bargaining power . The amount of rivalry among competitors : Competitors in any market can go to any extent in order to sustain at the top . One of the best example is Google and Yahoo Search engines which are battling in order to tap the maximum pie of the high end users by delivering them the desired set of applications and unique web surfing experience . Many people add that Government is the sixth force

Productivity frontier a curve of buyer value(y axis from low to high ) versus cost position(X axis from high to low ) Because of rapid diffusion of best practices operational effectiveness does not span the time , It is not a strategy . Player 2 Make Product Player 1 Make product Outsource MM OM

Outsource MO OO

I like to think of this in Game Theory terms. If there are two companies and both have the decision to make or outsource Product X. If they both choose to make Product X themselves then the only advantage Player 1 can gain is to be more operationally effective than Player 2.Similarly if both outsource the one that finds the best partner wins. In both of these cases it is operational effectiveness (which is easier to copy) rather than strategy that determines the outcome of the competition (in game theory this would be clear by the payout).

Two types of Imitators :

Repositioners Move to a new position Straddlers - Hold same position but change to match benefits . Trade offs occur for three reasons :

Reputation and image Activities themselves Limits on internal coordination and control Quality versus cost trade offs is only false when you are behind on the productivity frontier on the frontier shifts outwards . Strategy is making trade offs in competing . All tradeoffs supports the same position activities support each other , list like core competencies , critical resources and key success factors normally go against fitness .

To develop a core competency a company must do the following : First of all if a company has already discovered its unique competency than it is mandatory for them to isolate that core competency from the outer Corporate world and also make it preserved under the patronage of company Premises that is to blend the same core competency within the subset of organization and the whole management should get acquainted to it for the better outcomes keeping in mind the long term Company prospects . Secondly , In order to ensure that a company is still sustained with their unique capabilities a company should compare itself with the another company having the similar set of skills so that if any similarities found then a company should change and invest more funds into their core competency to make it more unique from its competitor . Encourage communication and involvement in core capability development across the organization . Preserve core strengths even as management expands and redefines the business; Unify the company across business units and functional units, and improve the transfer of knowledge and skills among them . Invent new markets and quickly enter emerging markets; Enhance image and build customer loyalty.

Finally, I would propose that the concept of core competency is not just for business but the public and not-for-profit sectors as well. For people working in the latter two sectors, reflect on what are your own organizations core competencies. And at the individual level, think about

what are your personal core competencies when it comes to how you add value to your organization and Strategy is creating fitness across a companys activities so that a company must align all its operational and informational activities as per the strategic Intent which in turn leads to effective information flow with the organization and in turn leads to better outcomes . What Prevents a sound strategy Misguided view of competition Organizational failures Desire to grow and prosper like other corporate giants have grown in the past decade Many go after operational effectiveness because it is clearly tangible and measurable \

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