You are on page 1of 24

Presented by-:

Manas Kumar
Saurav Kumar
Saurabh Singh
SUSTAINABLE COMPETITIVE
ADVANTAGE
Sustainability is a framework for
responding to the emerging competitive
threats and maintaining competitive
advantage.
Sustaining competitive advantage requires
erecting barriers against the competition.
A competitive strategy consists of moves to
1) Attract customers
2) Withstand competitive pressures
3) Strengthen an organization’s market position
CREATE COMPETITIVE
ADVANTAGE
Cheaper (lower cost) producer: ?
Better (superior perceived quality): ?
Newer (more innovative/up to
date/fashionable): ?
Faster (speed to market): ?
More desirable/ distinctive (successful
branding):?
Better reputation: ?
First mover advantages: ?
Provide your own examples of firms that
compete successfully on this basis. 3
RECOGNISING PATTERNS
 Advantage comes from understanding and exploiting the
emerging competitive market patterns. There is scope for
advantage based on:
 Search/ scanning capabilities
 Analysis/ interpretation capabilities
 Risk taking capabilities
 Implementation capabilities
 Change management capabilities
 Ownership of/ access to required complementary assets/
capabilities
 The ability to do this depends in turn on the effectiveness and
integration of the appropriate key business activities and
processes (distinctive capabilities/ competencies) which
underlie cost competitiveness, quality, innovation, speed to
market, network building, and customer intimacy.
 Production, marketing, logistics, supply chain management,
collaboration, branding, quality, market development, product
development, and innovation.
 Which in turn depends on organisational processes and
practices such as HRM, information and decision management,
and relationship management.
4
Porter’s approach to CA
Low cost/ differentiation may indeed be the
proximate cause of CA but they cannot be the
ultimate source.
Low cost positions, superior quality, speed to
market, or whatever, must come from
something or other the organisation has or
does.
For example in Ricardo’s time the superior returns
(CA) of some farmers indeed came from lower costs
which derived ultimately from superior quality (ie
more productive) land, a resource that was very
hard to make more of!
Nowadays Nokia’s or Dell’s superior returns come
ultimately from something similar, something
(scarce and hard to make more of) which allows
them to do things which enable them to offer a
better ‘value for money’ proposition to consumers.
manecon/options/create 5
Conditions for sustaining a
competitive advantage
A difference that matters
A gap in capabilities
1. Gap in business system
2. Gap in position
3. Regulatory and legal gaps
4. Gap in R&D and implementation
Sustainable differentiation
SWOT ANALYSIS OF
SUZLON(THREATS)
Intense competition
Over dependence on US
Foreign Exchange Risk
Technology Risk
Decreasing price of crude oil
SWOT ANALYSIS OF SUZLON
STRENGTH(Company Values)
 People strength
 Aggressive Vertical Integration Strategy
 Strong R&D team
 Expanding Manufacturing Capabilities
 Strong Order Book
 Aggressive Growth
SWOT ANALYSIS OF
SUZLON(STRENGTH)
 Cost Reduction
 Reverse Outsourcing
 End to End Solution
 Vertical Integration and Amalgamation
 Market Leadership in India and Global
Presence
 Growth
 Integrated Business model
SWOT ANALYSIS OF
SUZLON(WEAKNESS)
 Management Structure
 Capital Intensive
 Overseas Business
 Cash Conversion
 Growth in asset overweighting growth in
revenue
SWOT ANALYSIS OF
SUZLON(OPPURTUNITIES)
Environmental and Governmental Initiatives
Favorable tax exemptions
Untapped offshore market
Steady source of demand
SWOT ANALYSIS OF
SUZLON(THREATS)
Intense competition
Over dependence on US
Foreign Exchange Risk
Technology Risk
Decreasing price of crude oil
Company overview
Company overview
Timeline & Select
Milestones
Suzlon group – global
presence
Acquisition of Hansen
Transmission
Drivers for growth
Three key drivers to go beyond India:
1. Access to technology
Technical collaboration with Südwind (1995)
internalizing R&D by 1997/8
 Formation of AE Rotors in the Netherland•
Netherlands
 Product and process engineering in India
 Alliances: e.g. joint venture with Elin Generators
Maiden venture into the US market (2002/3)
 European technology platform
Experienced European wind energy professionals
(engineers, researchers,
 technicians) as the core to drive Suzlon’s R&D
 Compete in India
2. Access to people
 Experienced professionals in e.g. international sales, project management,
service
 management etc. with existing and tested relationships comprising the core
team
 Follow the demand – North America, Europe, Australia, China etc.
 Creation of Business Units (local organisations, local manufacturing etc.)
 Follow shift in customer trends (consolidating and becoming bigger more
complex
 higher demands for technology, services, Industrial plans etc.
3. Access to new markets/customers
 Acquisitions: Repower / Hansen Transmissions
 enter new markets and access new customers
 build up experienced and international (but localized) managerial/specialist
base
 local manufacturing to lower transportation costs
 expand product portfolio
 access state-of-the-art technology
Edge over competitors
Proactively addressing
challenges at their root
Blade cracks
 Retrofit exercise under way after satisfactory conclusion of
RCA and solution
Order book slowdown
 S88 V3, with demonstrable performance, positioned as
mainstay for internationalmarket
 Strong pipeline of potential customers
 Cost competitiveness, vertical integration and expanded
scope of services toprovide edge in tough market conditions
Global credit crisis
 Well-diversified market reach hedges
geographical risk
 Focusing on key markets and customer
relationships
 Current customer profile dominated by utilities
and financially sound developers
Working capital management
Working capital buildup
 Working capital reduction plan designed in
association with AT Kearney
Receivables
 Program management for order fulfillment
 Improvement in production planning process
 Improvement in documentation and certification
process
Inventories
 Procurement reduction
 Non- and slow-moving inventory reduction
 Redistribution of excess between units
 Mismatch and excess inventory reduction
Sustaining competetive
advantage