Introduction
The world market has become so competitive to an extent that every firm is struggling to achieve a larger market share. Globalization has led to stiff competition in the market. As a result, a number of firms continue to lay strategies that would enable them maintain their competitive edge.
These strategies include both medium and long-term, although it has recently emerged that most firms are considering cost leadership, product differentiation as well as price differentiation as major strategies. However, a good number of economic analysts and other interested managing directors of various firms observe that many strategies lack practical aspects.
This has forced many managers to look for strategies that are more pragmatic as far as turbulent competition in the market is concerned. In the recent past, Fast Company magazine wrote plenty of aspects as to why good to great companies achieved such statuses in the market. The column presented results that are more fascinating.
Change and Crisis in Firms
A number of firms normally react to crisis hence facilitating change. This has made such firms be reactive rather than proactive. In diverse markets, it is recognized that firms, which wait for crisis to occur in order to initiate change, do not succeed in competing effectively with rivals in the industry (Kotler 56).
However, firms that make an extensive market analysis in advance, as well as making changes as soon as possible, are reported to perform well under turbulent market conditions. This makes such companies be in better positions as far as competition in the market is concerned.
Incentives: bonuses, stock options and increment in salaries
There are some companies which belief that employees should always be motivated with attractive incentives in case a firm is to perform effectually in the market. Nevertheless, it is revealed that this is opposite of what should happen as far as employees are concerned. According to several researches, people are never motivated to be effective.
Self-motivation ensures that every employee works hard towards the overall goodness of the company, without considering his or her personal gain. This is true because some people would prefer staying in one firm for several years (Kotler 91). They perceive good performance of a company as their own performance and therefore, they always give their best.
Imposing fear for change to occur
A number of managements in companies practice the aspect of imposing fear to their subordinates, hoping that they will respond and deliver as expected. In contrast, this aspect has not featured anywhere in good to great companies (Collins 1). Instilling fear would only worsen the situation given that employees will be working out of fear.
This is likely to cause high rate of employee turnover since many employees would prefer shifting to other companies. In fact, companies deliver high results if employees are granted independence. People perform well when their rights and freedoms are respected.
Technology and change
Although most analysts and businesspersons continue to give more credit to technology as the major factor that heavily contribute to a firm’s effective performance, it has been discovered that technology may not have a big impact on the firm’s performance if change is not yet initiated. A change in a firm ensures that there is an outstanding relationship between the firm’s systems and its operational activities (Thomases 67).
A change might be either an overhaul or one with slight changes. The management should be keen to consider both the workforce and other aspects such as physical machines when making changes. The management should as well ensure that there is a relationship between technology and the firm’s operational activities. An effective relationship has enabled a number of competitive firms transform from good to great.
Revolution and firm’s performance
Many still believe that for a firm, which has derailed for a while in its performance, a dramatic change would seem to be the only solution for regaining its initial effective performance (Collins 1). In reality, this is not true since some firms may only need a partial change of the processes to regain their initial effectiveness.
Without an adequate analysis of the market, the management might change the entire system to a new system that does not relate to the current market situations. Such systems end up being rendered irrelevant, as the market demands new features that are devoid of the current system. Therefore, this might be a setback for a firm wishing to transform from good to great.
Conclusion
For most firms to attain a global competitive edge, they must incorporate strategies that are more pragmatic into their systems. A diverse number of firms in the market seem to apply strategies that are more theoretical than practical. To come up with solutions that are more practical, the management should consider keenly both internal and external business environments.
For instance, one should not prioritize cost leadership strategy in a high-end market. Definitely, the firm would lose because customers in this market segment prefer quality products as opposed to prices attached to products. It therefore means that firms should be aware of their products’ features, systems and processes. Finally, a firm should understand the industry in order to come up with more appealing and pragmatic strategies.
Works Cited
Collins, Jim. Fast Company “Good to Great”. Fast Company Magazine, 2001. Web.
Kotler,Philip. Marketing Insights from A-Z: 80 Concepts for every manager. New York: John Wiley and Sons, 2003. Print.
Thomases,Hollis. Twitter Marketing: An Hour a Day. Indianapolis, Indiana: Wiley Publishing, 2010. Print.