The Organizations Competitive Advantage - Essay Example

?How an organisation’s competitive advantage can be enhanced with the introduction of new technology? Introduction In the midst of globalisation and integration of marketing activities from one country to another, new technology has become an integral part in every business activities (Wetherly and Otter, 2011). After all, technology is an integral part of the business environment (Baron, 2006). Many online companies nowadays are successfully operating their businesses through the help of advanced information system. This system requires them to include advanced information technology to smoothly conduct their business operations. Many companies nowadays are trying to manage their businesses with the comfort and efficiency brought by the use of new technology in their operation. However, it is not only those online companies that are directly under the influence of new technology. All organisations especially those that have very complex activities rely heavily on the use of new technology. The car manufacturing industry for instance is relying greatly on the cutting-edge technology in order to meet the requirements of their customers and the prevailing market trend. In addition, the mobile communication industry and other related industries are trying to elaborate the importance of technology in order to go along well with the recent trend and development of business activities and operations in their specific areas. It is therefore a common understanding that the implementation of new technology in an organisation brings forward specific advantages and one of them is the efficiency which the bottom line is just to enhance the operation in order to achieve organisational goals. In line with this, new technology is strongly associated with competitive advantage. Every organisation seems to be using advanced technology, but the question remains how exactly it brings them certain competitive advantage. Included in this essay is the discussion about new technology and the creation of competitive advantage. It is important to discuss how exactly new technology and creation of competitive advantage within an organisation is associated. New technology and competitive advantage The three generic strategies and new technology Porter (1990) presented three generic strategies for competitive advantage and these include focus, differentiation and price. None about new technology is mentioned as part of these strategies for competitive advantage. However, it is clear that nowadays, using either one of these generic strategies would mean integrating the idea of new and existing technology. In the case of Wal-Mart as renowned retailing company in the United States, its generic strategy is low-cost for its product offerings. However, part of the institution of this strategy in the organisation is its highly computerised value-chain management system especially for its multinational and highly globalised operation. This is to ensure that whatever it has started so far can be substantially enhanced to the fullest with the integration of new technology. Wal-Mart viewed new technology as essential part of its complex operation especially that it operates at a global setting and in order for it to become sustainable when it comes to its low-cost-product strategy. Toyota is known for its focus differentiation strategy. However, in the process of creating it, the use of new technology is integrated in its entire operation. Its high level of standard quality product does not only enhance its cost advantage over its competitors but it specifically tries to say something about the image of its brand. Its brand image is associated with high level of cutting-edge technology and this means a lot to its marketing effort, strategy and eventually competitive advantage. In the age of globalisation, competition has become fierce allowing every organisation to enhance communication of their product offerings (Wetherly and Otter, 2011). Thus, individuals are bombarded with different information. The best information prevails and it is one of the best moves that a certain organisation creates competitive advantage. Marketing activities are actually used and it is easy to convince customers with the aid of new and advanced technology (Kotler et al., 1999, Boone and Kurtz, 2006). Streamlining the operation Technology has important impact especially on streamlining the operation of an organisation in the midst of a highly globalised world. Nowadays, people can conveniently shop online using credit cards. However, despite of the promised convenience of this business activity, there is still growing concern on safety and control. Thus, the modernization of operation in the advent of new technology requires modern and new innovative approach as well. For instance, streamlining the operations of banks requires new technologies in order to create sustainable competitive advantage (Gupta et al., 2001). There are managerial implications of this which include generally the entire global operations. Financial performance and the entire operation are at stake in this and thus there is a need to critically embrace the advantages of using new technology for the modern safety and control of a highly globalised business operation. Another way to globalise an organisation’s operation is through the use of information technology. Existing system of an organisation can be further enhanced by the use of information technology in order to achieve competitive advantage (Neo, 1988). This is clear in the case of Zara and Wal-Mart. A company like Wal-Mart that operates at the international level requires not just simple generic strategies or combination of them, but there is a need to consider new technology. Most of these technologies are in line with advanced information system that tries to link effective and efficient communication system for a better smooth-flowing operation. In a highly globalised world, communication matters a lot. In the case of Zara and its fast fashion, it is important to consider better communication in order to substantially obtain its corporate goals. In fact, the presence of highly advanced communication system is proven to be the reason for effective globalisation of fashion trend and localisation of popular culture. All of these are made possible with advanced communication system by the aid of new technology. Information system can help firms improve and achieve their competencies in business (Zhang and Lado, 2001). For instance, computing technologies and telecommunications have tried to influence the competitiveness of the country especially in the institution of broadband internet connection for the country’s global competitive advantage (Lee and Olmsted, 2004). However, the whole argument is not only confined in the issue of communication, but the entire point is that technology can be applied in every business aspect. In the case of Toyota Motors Corporation and other leading car manufacturers in the world, it is implied that in order to achieve high quality standard of product offerings, their technology must be cutting edge. Their performance must eventually rely heavily on the output created by new technology in order to produce product offerings that are cut above the other. In this case, Toyota Motors Corporation is significantly creating a competitive edge. After all, the said organisation claims that its major car productions and their brand are its primary assets. Thus, it was a big disadvantage on its part when recalls of its defective products were initiated. The bottom line of such event was traced back to the effective usage of new technology. It is therefore understood that Toyota’s fate in the market relies on the use of new innovative technology. Reasons to invest in new technology There are different reasons why firms invest in new technology and these include the market, efficiency, image enhancement, developmental, complying with regulatory demands, standardization and loans and grants (Butler et al., 1993). When it comes to marketing activities, firms are after of introducing new products in the market, they are following effective promotional activities in order to stimulate needs for their product and service offerings (Kotler et al., 1999, Boone and Kurtz, 2006). This is the reason why firms today try to invest in new technology. The use of new technology is also associated with cost reduction as one of the ultimate measures of efficiency. In the case of adapting electronic for health care system in the United States, one of the main reasons was to cut cost in order to reduce higher price for the health care in the country and not only ensure affordability but efficiency of the entire operation. New technology is considered to be a tool for image enhancement. This is clear in the case of iPod, iPhones and other renowned produced mobile communication gadgets brands. Apple Incorporated is known for its cutting-edge technology and because of this it has become the leading innovator in its industry through its focus differentiation strategy. However, this entire strategy would have not been realised without embracing the full potential of new technology. At the same time, this has also significant connection with keeping up with new technology. Apple Incorporated is viewed as the leading innovator in its industry and this means that it has always being looked forward to with its newly enhanced technology. Since Apple Incorporated is also good at stimulating needs for its product offerings, its target customers are always looking forward to its innovative offerings from time to time. These are just some of the reasons why it is important to invest in new technology. There are many reasons but the bottom line is to create competitive advantage. This is the reason why organisations have to consider associating technology with their competitive strategies in order to achieve competitive advantage. Conclusion There are many reasons why it is important to integrate new technology in an organisation’s operation. However, the bottom line of all these reasons is the formulation of competitive advantage. New technology therefore has become widely associated with achieving competitive advantage because of its ability to be able to enhance competitive strategies of an organisation. References Baron, D. (2006) The business environment. 5th ed. New Jersey: Upper Saddle River. Boone, L. E., and Kurtz, D. L. (2006) Contemporary Marketing. 12th ed. USA: South-Western. Butler, R., Turner, R., Coates, P., Pike, R., and Price, D. (1993) ‘Investing in new technology for competitive advantage.’ European Management Journal, Vol. 11 (3): 367-376. Gupta, M. C., Czernik, A., and Sharma, R. D. (2001) ‘Operations strategies of banks-using new technologies for competitive advantage.’ Technovation, Vol. 21 (12): 775-782. Kotler, P., Armstrong, G., Saunders, J., and Wong, V. (1999) Principles of Marketing. 2nd ed. England: Prentice Hall. Lee, C., and Olmsted, S. M. C. 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