Role of Competitive Strategy for Business Success: Analytical Essay

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Role of Competitive Strategy for Business Success: Analytical Essay

1. Introduction

Based on the first assignment report, various frameworks were being used to evaluate on RMIT Business College’s internal and external environment in the private higher education industry in Singapore. Through the analysis, we were able to recognize that the combination of both factors has resulted in a management challenge, which thereafter was redefined as a problem statement. However, the frameworks used in Assignment One did not fully address the problem statement as it only briefly identifies the weaknesses and threats of RMIT Business College in Singapore.

Therefore, in this report, the problem statement will then be restated to generate a new research question from the management perspective. In order to have a deeper and better understanding on the nature of the problem statement, new theories will be introduced and applied. In addition, alternative methods will also be incorporated so as to supplement the root cause of the new research question.

2. New Research Question

5 WHY Methodology

In order to have a better understanding in the root cause of the problem statement, I will be using the 5 Why Methodology in deriving the underlying cause.

The new research question is now being restated and rephrased to: How can RMIT Business College increase its skills, knowledge, and resources while meeting the demand of business growth in order to become Singapore Business Students’ choice of higher education provider?

3. Literature Review

In order to further understand the new research question in-depth, the following theories will be used – Business Level Strategy (Differentiation) and Corporate Level Strategy (Ansoff Matrix), so as to determine the cutting-edge solutions that can effectively address the management challenge.

3. 1 Business Level Strategy – Differentiation Generic Strategy

Fig 1 Porter’s Generic Strategy

In every business, there are bound to be competitions. Therefore, in order for RMIT Business College to gain a sustainable competitive advantage against its competitors, it will need to be flexible to meet the swift market and competitive changes. As such, it is important to incorporate strategies that enable them to rise above to gain greater success.

Michael Porter (1980) proposed that there are strategies that can aid organizations in gaining a competitive advantage in its industry. In the Business level strategy, this strategy is defined as the variations of the particular firm’s characteristics that have relevance to the competitive success or failure within its industry (Beard & Dess, 1981). It is about how individual businesses should go about competing in their respective markets by coming up with a competitive strategy that converts to business success. This strategy focuses on issues such as the response toward competitors’ move, innovation and appropriate scale.

In order for RMIT Business College to position itself well within the industry, it will need to opt through cost leadership, differentiation or focus (Anon., n.d.). With the organization’s sustainable competitive advantage set as the main focus of the new research question, the generic strategy of differentiation will be applied to RMIT Business College. It is relevant in addressing the problem statement as the current broad differentiation strategy that is being adopted by RMIT is no longer sustainable to become Singapore’s business student priority choice of higher education provider by Year 2030.

Over the years, global trends and factors are evolving which has influenced the higher education industry. With technology are rapidly advancing, traditional education learning is becoming obsolete (Yang, 2015). As a result, the long-established business models are no longer effective in sustaining the future of colleges and universities.

Today, the landscape of higher education is one that is revolving to fit into the digital era and the expectations of technology-savvy students. Generational diversity reacts differently to the teaching and learning styles, this creates a generation gap (Gillispie, 2016). The traditional learning methods are no longer appealing to the students. Therefore, curriculums in the higher education industry are progressively changing to meet the demands of the market. As a result, the conventional way of traditional classroom teaching is now “flipped” to incorporate technology in learning which is increasingly becoming popular. Hence, it is necessary for RMIT Business College to improve in its delivery of curriculums be it through a flipped classroom or a combination of both.

Moreover, expectations from employers of Business graduations and society play a strong influence on the curriculum development of higher education institutions (Tatjana Nikitina, 2017). The changes in the external environment such as technological innovations and the demand of new skills in the labor market have led to a shift in the perception on employers and society’s expectations. As a result, employers are now on the lookout for business graduates who possess entrepreneurial and analytical skills. Therefore, the course of action that needs to be taken is to align and respond to employers’ expectations of graduates.

As such, RMIT Business College will need to come up with differentiation strategies to tackle the challenge, whereby the failure to anticipate will result in a negative impact on sustainable business success. Most importantly, it is imperative for RMIT Business College to implement strategies that differentiate themselves against the other competitors so as to enhance their competitive advantage in the industry in Singapore. Upon finding the appropriate opportunities for differentiation, RMIT Business College can then implement and take the necessary course of action. This will then be able to address the root cause of the problem statement, allowing them to be able to respond to future competitors’ moves as well as employers’ expectations.

3.1.1 Strengths & Weakness

In the business level strategy, customers are the ones who form the foundation of business. Therefore, in order to be able to implement any strategy successfully, it requires businesses to have a deep understanding in their target market (Bass, n.d.).

Focusing on a particular generic strategy, it enables RMIT Business College to focus on the core elements of its businesses. The advantage that it presents is it enables organizations to potentially leverage themselves to enhance business success. In addition, by anticipating the needs of their customers, organizations will be able to safeguard themselves against their competitors and achieve recognition for their brand loyalty. Moreover, by adopting the differentiation strategy, businesses will be able to work towards satisfying expectations by creating strategies that will be able to value add to the organization, customers and employers.

However, the downside is that it is important for the organization to be vigilant in monitoring businesses in order to avoid complacency. The needs and expectations of their customers must be carefully sought and understood in order for businesses to implement an effective strategy that creates a sustainable business advantage.

3.2 Corporate-Level Strategy – Ansoff Matrix

Corporate-level strategy requires careful analysis of in the selection of businesses that the organizations are able to compete in successfully. It is defined as the implementation of a strategic plan of action to achieve specific targets in order to meet business success (Leonard, 2019). The purpose of this strategy aids in maximizing the overall productivity where it helps to increase the competitive advantage of businesses while offering a unique service or product to their consumers.

This strategy concerns the efficiency in utilization and allocation of resources so as to value add and benefit businesses. As such, the strategies mapped out seeks to translate objectives and goals into reality. Addressing the problem statement through the corporate strategy approach enables RMIT to obtain a mixture of business units that enhance business success as a whole. Therefore, in order to determine the products or market that organizations are able to enter, make or improve, RMIT will need to opt through market penetration, market/product development or diversification.

Igor Ansoff who developed the strategy model – Ansoff Matrix – proposed that this tool can aid organizations in plotting strategies through penetrating into the current or new market via existing or new products (Hanlon, 2018). This will be able to assist RMIT in reviewing their strategic options in both strategic management and marketing. In turn, it allows RMIT Business College to achieve business growth in Singapore.

The private higher education industry is of extensive economic significance, be it internationally or nationally. The reputation of institutions relies on its outstanding quality, especially in the competitive global markets. Over the years, educational institutions are increasingly recognizing the need to market themselves in the climate of competitive competition (Hemsley-Brown & Oplatka, 2006). Therefore, through market penetration, it can allow RMIT to improve on their productivity, marketing activities as well as qualities. Whilst enhancing on their existing products and services, it will also increase their market share.

In addition, stakeholders play an important role in the development of private higher education. Their interest and expectations are constantly changing in the global market. Therefore, there is a need to achieve an understanding of the various customers that they are coming in contact with, be it the current or potential future stakeholders (Gajić, 2012). Rather than being dependent on a particular market, the organization can seek in penetrating into other potential markets. This enhances RMIT competency by exploiting on its existing course into new market areas. However, the success of market development depends heavily on the organization’s ability in investing an extensive amount of time to conduct research on their customers and market. In turn, RMIT will be able to benefit from the economies of scale as it allows them to be able to utilize the excess capability that is readily available.

As such, Ansoff Matrix is relevant in addressing the problem statement as it can assist RMIT in analysing the possible growth strategies that will be able to contribute to business success.

3.2.1 Strength & Weakness of Ansoff Matrix.

Ansoff Matrix is a strategic planning tool that provides a framework in assisting organizations in focusing on their businesses while laying out possible growth strategies. It links the organization’s marketing strategy while aligning with its generic strategy direction. In turn, it sources for opportunities in growing businesses while leveraging on its existing and/or new markets and products with its core competencies.

However, the downside to this strategic planning tool is that it does not consider the activities of the external environment. It focuses mainly on two factors – market and product, which leave numerous considering factors that could affect business out of the picture.

Therefore, this tool should be used as an aid in conjunction with other analysis tools to take into consideration other factors that may affect the organization as the business environment varies and are constantly changing (Rodrigo, 2015).

4. Alternative Method

In order to further eliminate the weakness and supplement the above-mentioned theories, Mc Kinsey 7S Framework will be used.

McKinsey 7S Framework

McKinsey 7S Framework is a management tool used to analyze the design of the organization and its effectiveness by studying the 7 key internal elements that contribute to business success (Singh, 2013). It addresses organizational problems as it identifies if the key elements are aligned effectively to enable the organization to achieve its objectives.

Fig 2 The McKinsey 7S Framework (Jurevicius, 2013)

The framework consists of 7 elements are categorized into “Hard Ss” and “Soft Ss”, namely – strategy, structure, systems, shared values, style, staff and skills. Elements that are grouped under “Hard Ss” are easy to be identified, managed and tangible, whereas the elements that are under “Soft Ss” are the opposite, forming the base of the organization (Peters & Waterman, 1982).

By using the McKinsey Framework Model, RMIT will need to engage with every element in the framework to ensure that all of it are effectively aligned. By doing so, the organization will be able to derive the gaps or differences between the relationship of the elements. Moreover, elements in the framework are interconnected. As such, upon deciding on an adjustment to a specific element, it would require RMIT to look into the other elements and thereafter to make some adjustments in order for businesses to be able to achieve optimal effectiveness. Therefore, in order to achieve the optimal organizational design, it is necessary to conduct research, collate data and have an in-depth understanding.

The framework can be used to position itself to better prepare the organization when facing problems relating to external factors. It will help RMIT in considering whether it requires a different organizational structure to function more effectively. Through this, it will then enable the organization to be able to identify the areas that require realignment. In turn, it translates to creating a sustainable competitive advantage.

As a result, McKinsey 7S Framework can aid in addressing the above theories as it aligns the respective elements that are interconnected. Moreover, through the assessment of each element, RMIT will be able to assess how to go about improving the capabilities of their business units as a jumpstart in creating an action plan for change. This increases their competitive advantage and business growth.

5. Conclusion

In conclusion, the analysis which I have undertaken by incorporating the use of the various framework will be able to aid in addressing the management challenge. It allows me to gain a deeper insight in anticipation for the future of RMIT Business College in Singapore.

Firstly, from the business strategy level point of view, it is imperative for RMIT Business College to discover and implement strategies that enable them to be able to differentiate themselves against their competitors whilst in anticipation of the demands of the market in higher education industry. Anticipating, it allows them to be a step ahead of their competitors. In turn, it increases their competitive advantage and business outcome.

Secondly, using the Ansoff Matrix from the corporate level strategy point of view gives RMIT an opportunity in identifying the possible growth strategies in their business units. It recognizes the way in which the organization can enhance their strategic growth plan through the four Ansoff growth strategies. As a result, the organization will be able to value add to their businesses.

Lastly, the McKinsey 7S Framework model displays a broad view of how the organization is being structured. It helps in facilitating RMIT in identifying the areas needed for improvement internally by understanding and ensuring that the internal elements are effectively aligned with the commonly shared values. This framework serves as a powerful tool in analyzing and assessing the internal changes whereby the key elements play a part in determining business success.

Therefore, in order to achieve optimal competitive business advantage, the organization and business units can incorporate the various strategies in finding the best suit strategic solutions in resolving the management challenge.

6. References

Anon., n.d. Understanding Business-Level Strategy through “Generic Strategies”. [Online]
Available at: https://opentextbc.ca/strategicmanagement/chapter/understanding-business-level-strategy-through-generic-strategies/ [Accessed 28 February 2019].
Bass, B., n.d. Advantages & Disadvantages of Business-Level Strategy. [Online]
Available at: https://smallbusiness.chron.com/advantages-disadvantages-businesslevel-strategy-19209.html [Accessed 4 March 2019].
Beard, D. W. & Dess, G. G., 1981. Corporate-Level Strategy, Business-Level Strategy, and firm performance. [Online]
Available at: https://search-proquest-com.ezproxy.lib.rmit.edu.au/docview/1305664925?accountid=13552&rfr_id=info%3Axri%2Fsid%3Aprimo [Accessed 28 February 2019].
Gajić, J., 2012. Importance of marketing mix in higher education institutions. [Online]
Available at: https://www.researchgate.net/publication/266223503_Importance_of_marketing_mix_in_higher_education_institutions [Accessed 8 March 2019].
Gillispie, V., 2016. Using the Flipped Classroom to Bridge the Gap to Generation Y. [Online]
Available at: https://search-proquest-com.ezproxy.lib.rmit.edu.au/docview/2158211884?accountid=13552&rfr_id=info%3Axri%2Fsid%3Aprimo [Accessed 1 March 2019].
Hanlon, A., 2018. Using The Ansoff Matrix to identify growth opportunities. [Online]
Available at: https://www.smartinsights.com/marketing-planning/create-a-marketing-plan/ansoff-model/ [Accessed 1 March 2019].
Hemsley-Brown, J. & Oplatka, I., 2006. Universities in a competitive global marketplace: A systematic review of the literature on higher education marketing. [Online]
Available at: https://search-proquest-com.ezproxy.lib.rmit.edu.au/docview/234408547/fulltextPDF/29020109E75040C8PQ/1?accountid=13552 [Accessed 8 March 2019].
Jurevicius, O., 2013. McKinsey 7s Model. [Online]
Available at: https://www.strategicmanagementinsight.com/tools/mckinsey-7s-model-framework.html [Accessed 2 March 2019].
Leonard, K., 2019. Types of Corporate Level Strategy. [Online]
Available at: https://smallbusiness.chron.com/types-corporate-level-strategy-60147.html [Accessed 5 March 2019].
Peters, T. J. & Waterman, R. H., 1982. In Search of Excellence: Lessons from America’s Best-Run Companies. s.l.:s.n.
Ravanfar, M., 2015. Analyzing organizational structure based on 7s model of Mckinsey. Global Journals Inc. , 15(10), pp. 1-2.
Rodrigo, 2015. The Ansoff Matrix. [Online]
Available at: https://writepass.com/journal/2015/03/the-ansoff-matrix/ [Accessed 9 March 2019].
Singh, A., 2013. A Study of Role of McKinsey’s 7S Framework in Achieving Organizational Excellence. [Online]
Available at: https://search-proquest-com.ezproxy.lib.rmit.edu.au/docview/1467437673?accountid=13552&rfr_id=info%3Axri%2Fsid%3Aprimo [Accessed 10 March 2019].
Tatjana Nikitina, I. L., 2017. Overview of Trends and Developments in Business Education. [Online]
Available at: https://www.researchgate.net/publication/318504381_Overview_of_Trends_and_Developments_in_Business_Education [Accessed 11 March 2019].
Yang, C., 2015. Tech in, the schools out by the year 2065?. [Online]
Available at: https://www.straitstimes.com/singapore/education/tech-in-schools-out-by-year-2065 [Accessed 1 March 2019].

7. Appendix

Feedback

Though I have demonstrated a good understanding on the concepts that were presented in my assignment one report as well as the management challenge, there are areas that I need to improve on. Rather than touching on the surface of the concepts, theories, and information which I have researched, I need to engage critically to analyze and process it to present the information and ideas better. Moreover, I need to broaden my readings in order to enable myself to critically elaborate and link the information from the credential resource to my report. Therefore, it is necessary for me to read more and reflect in-depth, only then will I be able to demonstrate my understanding of the information which I have consolidated. This will be able to enhance on my ability in the application of theories.

Use of Theories & Frameworks

There is a need for me to analyze and discuss critically on my choice of the tools, models, and theoretical frameworks that I have applied. This is so as to demonstrate my understanding of the purpose, applicability, and suitability of usage in the context that supports my argument in the report. At the same time, to elaborate deeper on my findings and thereafter critically demonstrate how it has an influence on the analysis that I have undertaken. Therefore, in this report, I have stated the reason why my chosen theories are relevant and suitable to the context of my report.

Furthermore, my assignment one report could have been better by demonstrating a more integrated analysis to portray the linkage of my key findings in each research article and thereafter evaluate how the information can be contributed to the management challenge that I have identified. The areas of improvement comprise of undertaking the analysis in the direction that helps in establishing a valid case supporting my analysis of the university. Therefore, in this report, I have attempted to link the theories in support of the relevance to the context of my argument.

Academic Standards

Generally, my assignment one report was well structured where I reflected a good discussion on the subject matter. I have demonstrated a good referencing style in citing the academic sources which I have used. However, I need to further improve in my writing whereby to support my ideas with sufficient evidence, diving deep into facts instead of narrative analogies. More inference has thus been conducted in this report to adjust and ensure higher quality work.

How can RMIT Business College increase its skills, knowledge, and strategies in order to differentiate itself and meet the changing demand for business growth?
Why does RMIT Business College in Singapore need to increase its skills, knowledge, and resources?
In order to differentiate themselves and meet the demand of business growth.
Why do they need to differentiate themselves?
To remain competitive in the higher education industry and meet the expectations of customers.
Why is the industry becoming increasingly competitive?
Why is it necessary for RMIT Business College to increase, attract or retain its students?
Why is it important to remain competitive in the industry?
To become a Singapore Business student choice of higher education provider.
Due to the competition among the relatively large number of higher education institutions with reputable branding.
To help increase, attract and retain current and prospective students.