Generally, competitive advantage refers to a company’s business advantage over its competitors that give it an edge and enable it to control a particular portion of the market (Shin, 2001). For a company to have a competitive advantage over other companies, it must have something that gives it an edge with its products or services. According to Hisrich and Kearney (2014), there are six competitive advantages that companies may need to adhere to if they intend to stay ahead of their competition. These competitive advantages include adaptation to environmental changes external to the organization, focused and client driven, flexibility of strategies and processes that meet the demands of all stakeholders, ability to respond quickly to the needs of the business environment, meeting and exceeding the needs of consumers and actively engaging in research and development. This paper will take Sony, an electronic giant in the world, as the example to use in illustrating how a company can make use of competitive advantage to become a leader in its industry.
Over the years, Sony has managed to not only remain relevant in its field, but also to be a force to be reckoned with, competing with the big wigs such as Microsoft, Samsung and Apple to own a market share in every aspect of the electronics industry. With annual revenues of over $68 billion and having employed over 128,000 employees, the company is one of the largest conglomerates today. This leads to the question of how Sony has managed to remain relevant all these years, despite the shifting market forces and consumer needs that have seen other former giants in fields such as photography (Kodak) and mobile industry (Nokia) lose their markets and become relegated to the position of minor players.
Delegate your assignment to our experts and they will do the rest.
A quick look at Sony’s history and business model enables one to see how the company has managed to remain relevant all these years. Indeed, the company has fulfilled all the six stated competitive advantages by Hisrich and Kearny (2014). First, a look at the organizational leadership philosophy illustrates how the company has re-asserted itself time and over again. Sony was established by its launch of the transistor radios immediately after the Second World War. Through this innovative technology back then, the company was able to assert itself across the globe, gaining a name for itself as a technology company that could offer highly innovative technologies that were consumer centric. This philosophy of innovation is clearly visible today; Sony is one of the biggest players in the gaming industry with their Play Station brand. Their Sony Xperia brand has enabled them to capture a part of the phones and telecommunication market. Their entrance into just about every aspect of the electronics industry, from televisions to home theater systems gives them an edge over other companies.
Such diversity illustrates that the organization is consumer driven. The leadership at Sony has tried to ensure that every product they make is based on consumer needs. The company has a flexibility that allows it to fit into any part of the electronics industry. As a way of diversifying their activities to ensure that they sustain a competitive advantage over competitors in the industry, Sony spends a lot of its resources in ensuring that they have the latest technology in every aspect. This is in line with Hisrich and Kearney’s assessment that a company needs to be flexible and have quick response to the client’s needs. For example, the Nokia Company was the ruling company in the telecommunication and mobile phones industry from the early to mid 2000s. However, after the introduction of smart phones, the company went into oblivion. A major reason for this was that the company refused to adapt to the client’s needs, instead sticking with their Symbian Operating System, which was not the most user friendly and was not suitable for smart phone clients.
Here, the company refused to be proactive in how they reacted to the needs of the market, and instead, focused on an aspect of their technology that they thought gave them an edge but was outdated. Sony did the opposite; with the introduction of the smart phones, Sony was among the first companies to launch a smart phone with the latest technology, which was the Android operating system. This new system was very flexible with the consumer since it allowed for a downloading of just about any application from the Google play store.
Hisrich and Kearney also state that a company must be able to use its research and development in such a way that it will be able to identify and create products that are suitable for future client needs. R&D enables a company to stay ahead of its competition, and Sony has managed time and again to use its R&D department as a means of ensuring that they provide necessary products that are revolutionary. Take for example their introduction of the Bravia range of LCD televisions, and the subsequent use of OLED and LED to create high end televisions. The company was among the first to launch these technologies, so much that they are still at the top in terms of sales in this product segment.
In conclusion, Sony has managed to address the six competitive advantages stated by Hisrich and Kearney, which hasenabled them to remain relevant in a very dynamic and constantly changing international market. They have done this by focusing their energies on the satisfaction of the client. With a philosophy of innovation that is entrenched in its leadership, the company has an edge over most electronic companies. It is also actively engaged in R&D initiatives that have over the years proven to be very advantageous, leading to the discovering and implementing of futuristic concepts that are client focused. Through these measures, Sony remains a force to reckon with in today’s electronics business and society at large.
References
Hisrich, R. D., & Kearney, C. (2014). Managing innovation and entrepreneurship . Thousand Oaks, California: SAGE Publications.
Shin, N. (2001). Strategies for competitive advantage in electronic commerce. J. Electron. Commerce Res. , 2 (4), 164-171.
