In the course of operating a business entity, it is essential for an organization to ensure that its operations shall be sustainable in the market. Thus, every business entity strives to achieve a sustainable level of operation in the short run and in the long run. The economic growth that has been experienced in the world, coupled by the advancements in the field of information and technology and changes in tastes and preferences of consumers have led to the growth and development of all the sectors of the economy.
Such a business entities can now operate in a global level. This has increased the level of competition among rival firms. Therefore, for these businesses to be profitable and sustainable, it is essential for them to come up with a number of strategies that will enable it to identify and build a competitive advantage over its rivals in the market.
An organization can come up with strategies that affect its internal and external factors of operations. It is thus essential for an organization to develop a strong organization culture that defines it and differentiates it from other entities. It has always been said that an organization is as good as its people are.
Therefore, the management should develop an organization culture that should be adopted by all its employees. For instance, in the competitive world, it is essential that an organization adopts a culture that aims at achieving consumer satisfaction. This culture should focus on the short term and long term goals and objectives of the organization. This will enable the organization to realise its vision and mission and satisfy the consumer needs and preferences.
It is also essential for a firm to conduct a SWOT analysis. A SWOT analysis is a powerful tool since it makes an organization to understand its strengths, weaknesses, opportunities and threats. This information is essential as it gives the firm critical information with regards to market intelligence. From this information, a firm will be capable of formulating marketing and operation strategies through the maximum utilization of its resources and competences.
Formulating viable strategies is just the start. However, for a firm to maintain its competitive edge and continue to be sustainable in future, it requires effective management practices. First, monitoring of the operations of the firm is essential. This can be achieved by monitoring the human and financial resources of the company.
Human resources should be monitored to ensure that the performance of employees is as per the expected standards of the firm and conform to the goals, objectives, vision and mission of the organization. Financial resources on the other hand are monitored to ensure that the firm is cost effective.
Performance monitoring and control is essential as it ensures that the firm operates in an effective and efficient manner through sustainable utilization of resources hence reducing operating costs and maximizing its benefits. The reduction of units costs over time is an indicator that a firm is operating efficiently.
This makes a firm to stand on a competitive edge over its rivals.
Finally, it is essential for a firm to determine the market value of its products and their expect rate of growth. This can be achieved through portfolio analysis by conducting a Boston Consulting Group (BCG) matrix. Normally, products follow the following trend in their life cycle.
A BCG matrix shows status of a firm in an industry versus the life cycle of its product and the impacts they have on the firm in terms of growth and profitability. A firm can be either a star, a cash cow, a question mark or a dog. Once this identification has been done, a firm should thus formulate strategic plans that will ensure that it experiences maximum benefits in the short run and in the long run.
Brand identification and product differentiation are some of the strategies that a firm can adopt. In addition, fully-grown organization can expand into new markets that have not been exploited. These strategies will ensure that a firm stands on a competitive edge over its rivals.