Essay About Lower Cost And External Factor Analysis

External Factor Analysis
External Factors analysis: Technological factor: Lower cost, outsourcing: globalEconomic trend: decline, recession, Social cultural: change in habit, change in trendThreat: (threaten profit)Intensifying competition Growth in popularity of smartphonesDecreasing MarginsCustomer not upgrading (hard to surprise them)Opportunities: Markets outside of the U.S: Low cost production outside of the U.SIncrease in gov spending: stimulate economy, subsidize company.IT services?Target small business directlyEntrepreneur products: Network switches, printers…etcKey success factors:Brand management: more important than before. Effective distribution channel**:After Sale Support: Operational (cost) efficiency: to offer low price products, you have to be effective (economics of scale)**Access to global markets: Speed to market**: May 9th Internal AnalysisExternal factor during 2002-2009: 9.11 (substitute with other mode of transportation); global recessionSouthwest: only company did better…keep lower cost Apple: external factors only tell us the half of the storyother half is internal factors…What company does inside to gain competitive advantages?At the end of the day: maximize profits to stay in the business.By…cost advantage Decrease costDifferentiation advantageDual advantageCore competencies: set apart firm frim other firmsDo all core competencies turn into advantage over others? Anybody could be good at something.Sustainable competitive advantages meet these criteria.Valuable:Rare: core competency must be rare.Costly to imitate: ex) Apple’s integrated organizationNon substitutable: These should result in better financial return:proof of an advantage ….Value Chain: Supply Chan (chain of activities, turn raw materials into final products) Main activities: supply chain (create value of end product), operations, distribution (predict demand), marketing and sales (high level of service), follow up service