Perform competitive cost analysis based on the Value Chain
framework and give your management in-depth numerical insights on
its competitive (dis)advantage.
FACULTY: GILAD 0.7 CEU CREDIT
November 19
Many managers think of competitive advantage in terms of SWOT
analysis (Strengths, Weaknesses, Opportunities and Threats). Yet
SWOT is subjective, generic, and quite often misleading in its
conclusions. Relying on SWOT to make strategic decisions is like
relying on poetry to calculate profits. Some executives and consultants
use income statement and balance sheet analysis to understand a
company position vis a vis its competitors. This is as bad as using
SWOT, since consolidated financial statements do not tell the full
story, the right story or even the relevant story. The proper way
to assess competitive advantage is through a strategic Value Chain
Analysis (VCA).
Managers think of value chain analysis in two different ways:
an analysis across an industry chain – from suppliers to
competitors to distributors and buyers in a given industry. This
type of analysis has been covered in great detail in the Competitive
Blindspots course. In this course, value chain analysis refers
to the strategic analysis of a chain of activities performed by
a company – be it your company or its competitors – which
produce specific value to customers at a specific cost. Understanding
the value chain of a competitor means accurately understanding
its source of competitive advantage (or disadvantage), its relative
cost structure, and its unique strategic positioning.
Management often asks its CI analysts to explain a competitor’s
competitive advantage. What do they do better? What do we do better?
A firm needs to constantly guard its competitive advantage against
competitors’ improvements in their activity chain, and CI
managers must be at the forefront of that fight.
This case-based seminar will teach participants to:
Understand the real strategic differences in value chain activities
between their company and competitors
Estimate competitors’ cost positions
Use differences in activities to understand why and where competitors’ strategies
differ from their company’s strategies
Understand why large differences in profitability are sustained
within the same industry
Learn a framework to put a “bottom line” number
on “added value” rather than an ambiguous marketing
spin
Identify major cost drivers for competitors’ advantage
Understand the precise nature and sources of competitive advantage
and disadvantage
To know which benchmarking has a chance to succeed and which
is just a waste of money
A NOTE TO PARTICIPANTS
To gain the greatest benefit from this course, please be sure to
review the case material in advance.
Problem
Sets
All ACI programs teach
students how to overcome the most challenging competitive
intelligence issues. See samples of the problem
sets for this course such as: