Motivational Speaker

Hello, I'm Your Motivational Speaker

Hello and thank you for joining me today. I am glad to see so many of you here interested to learn about some of today's hottest business topics. My name is Mai Biz and I am a renowned business guru and motivational speaker. I have been contracted by a prestigious national business organization to conduct this seminar today. This remarkable seminar I am about to present will cover the topics of competitive advantage and international business. I am very excited to share my thoughts; however, if you have any questions during the seminar please feel free to ask, we are all here to learn!

To begin, how many of you have heard of, wanted to learn about or have discussed competitive advantage in your respective businesses? (Approximately 75% of the audience raises their hands). Good! That is more than I expected, I can tell we will have a magnificent seminar already! My next question is how many of you are puzzled by competitive advantage? (Approximately 50% of the audience raises their hands). So about half of you then, excellent that is why I am here! We will begin by first explaining the meaning of competitive advantage. Competitive advantage is "superiority gained by a firm when it can provide the same value as its competitors but at a lower price, or can charge higher prices by providing greater value through differentiation. Competitive advantage results from matching core competencies to the opportunities" (Competitive Advantage, 2010 ). Competitive advantage allows a company to earn greater returns than the cost of investments. Therefore, profits are crucial to competitive advantage. In fact, a primary goal for business strategy is to accomplish competitive advantage.

Now that we know what competitive advantage is, understanding its relationship to international business is crucial. As most of you may know, international business is simply business that operates on a global scale. International business is the frontline for significantly improving and optimizing business systems. Further, this can create financial and operational gains as well as returns on investments to give corporations the strategy to build competitive advantage.

Although I have no affiliation, I must mention that Michael Porter's Competitive Strategy is a must read. This book gives a superb overview of competitive strategy and analysis. Porter states, "that there are three generic strategies: overall cost leadership, differentiation, and focus on a particular market niche" (Porter, 1998, p. 35). Cost leadership requires companies to create policies directed toward growing to be the low-cost producer and distributor in the market.

For example, discount retailers such as Wal-Mart distribute cost savings to their consumers by offering lower prices on goods. The store can retain profit margins equally with competitors. However, for the reason they can save on costs, Wal-Mart gains a competitive advantage because they can offer the same goods at cheaper prices. K-mart is another example of a cost cutting retailer, although Wal-Mart quickly thwarted this strategy by cutting costs even further.

The second strategy, differentiating, involves the company designing a unique product to the industry. Take Hewlett-Packard, for example their printers give them competitive advantage because they offer functions that other printers do not. Further, they have customer support available 24 hours a day, seven days a week.

The third strategy is focusing. This involves researching a target market and concentrating on a product line, specific customer, geographical area, or distribution channel. Wal-Mart is an excellent example once again. This firm began in small towns in the Midwest and South. As the company built its reputation for low-prices and variety, the company's knowledge increased as well. This led to the ability to expand in the region, then the nation, and finally into the global marketplace. Wal-Mart began by focusing on a cost leader strategy in a defined market, and later grew beyond its primary market. Analyzing one's organizational needs is essential because each company's goals may differ and require a separate strategy. In fact, multiple strategies are often employed and together they create competitive advantage.

Now we will move forward to the strategy of creating value. As mentioned earlier, a company possesses competitive advantage when it is employing a value creating strategy not in use by any other competitor. So how does the company create value? An organization can create value by execute known as the value chain. This can be accomplished by low cost, better quality, special offers or promotions, something that separates the company and causes an advantage over the competition. In international business, creating value can come in the form of customized products tailored to a specific country's needs or providing quality the country has never experienced before. This sounds like a piece of cake, right? Just make some different products from what the country has experienced and viola, creating value strategy accomplished! Unfortunately, it is not quite so simple.

Additional risks arise when companies engage in global trade or international business. Some risks include global supply chain uncertainty. For example, ensuring deliveries can be more difficult because of communication breakdowns, shipping expenses are increased because of tariffs, fuel costs, etc. Exchange rates can fluctuate as well and that can cause a loss. What is more difficult, these potential issues must be anticipated and included in the organization's strategy to retain competitive advantage. Therefore, many challenges are present, but many opportunities are