SCCV- Essay Pair Makichi, Christine Netsai & Adadzewa Otu, Keziah GROUP 1 Essay Pair Makichi, Christine Netsai Adadzewa Otu, Keziah AESTHETIC WAY OF GAINING COMPETITIVE ADVANTAGE Strategy - Classic and Contemporary Views Han Andersson 722A04 SCCV- Essay Pair Makichi, Christine Netsai & Adadzewa Otu, Keziah Table of Content Introduction. 3 Brand Perception as Aesthetic Value 4 Darker side of Aesthetics 6 References 9 SCCV- Essay Pair Makichi, Christine Netsai & Adadzewa Otu, Keziah AESTHETIC WAY OF GAINING COMPETITIVE ADVANTAGE Introduction. In today’s world, there is a big shift from economic value towards aesthetic values as a basis for competitive strategies. Giant organizations such as Google, Microsoft, Walmart, Amazon, Twitter and others have been shifting their focus from basing their competitive strategy on the economic value of their products. The main focus is now dedicated towards aesthetic value. Whittington (2012) observed that these giant organizations have powerful strategies with noticeable impacts on society. However, the focus of the essay is to analyze the competitive strategies of these giant organizations which have necessitated them to make a reverberating impact on the society. Through analysis, the intention is to heighten the reader’s understanding on how aesthetics have contributed towards a shift from economic value to aesthetic value as the basis for competitive strategy. From the authors’ point of view, the following are the working definitions to improve readers’ understanding. Aesthetic Value relates to sensual attributes of fineness such as good or bad; effortlessness/ complex; fast or slow; beautiful or ugly and many other sensory perceptions. Economic value relates to an exchange value for a product or service. It has to do with the economic cost attached to it and mostly determined by demand and supply. Ethical values reflect such issues like fairness or unfairness of certain actions, responsible or irresponsible actions, respect or disrespectful and so forth. However, the shift from focusing on economic value to aesthetic value can be observed in major fast food restaurants such as McDonalds, Starbucks and others. In the motor industry, and technological industry the shift has also been noticed over the recent years. Organizations have realized that to stay ahead of competition, it is not the price of the product or prolonging the product life cycle to improve on diminishing returns. Of course flat structure makes an organization adaptable to the fast changes in the environment, but the slow performance of the product on the market has caused organizations to analyze buying behaviour of customers and realized that sensory attributes trigger more sales. Constant changes in meaning, beauty, tastes, smell, feeling does the trick! Aesthetic value plays an integral role in driving sales higher due to impulse purchases. Driven by slow performance in the economy due to Covid SCCV- Essay Pair Makichi, Christine Netsai & Adadzewa Otu, Keziah 19 and intense competition, restaurants such as Starbucks observed how competition advantage can be achieved when sales are very low, the only way to increase sales is by introducing aesthetically improved sales bargains which enhance the sensory feelings of the customers, for example renovations and decorations of restaurants and changing the shapes of the sandwiches, improving the mixture of salads or enhancing the scent of the food. In a way, such improvements have a major impact on the sensory experiences of customers making them feel good through tastes, smells or feelings. Major restaurants have discovered that when people visit restaurants, it is not only food that they want, but they seek sensory appealing experiences which make those moments special. From the authors’ view such experiences do not give long-term competitive advantages, these are strategies for the business to keep going and remain in business. It requires continuous competitive strategy formulation to remain ahead of competition by way of introducing increasing the sensory feelings, tastes, smells and creating special moments for the consumer to feel great! Strategists as design thinkers, they have to continuously embark on research and formulate strategies for implementation in order for the organization to remain in business. Aesthetic world is also noticeable in the motor industry. The initial vehicles which were introduced like the Ford vehicles in 1896, were horse driven. They did not have any gears; the vehicle designs lacked comfort and made creaking and irritating noise when they moved. The current mechanical underpinnings are above board! The comfort we experience in the modern day vehicles is luxurious and the shapes are round, beautiful and eye catching too. What we experience today is comfortable, balanced, reliable, fast, appealing and beautiful cars with good names such as Alfa Romeo, Mercedes-Benz, Lamborghini, Ferrari which is one of the fastest vehicles and many more vehicle models. What we see is a complete shift from economic value to aesthetic experiences which are introduced to achieve competitive advantage. The aesthetic way to achieve competitive advantage reflects how some giant motor industries have disappeared from the market because their vehicles quickly lost value, they no longer looked beautiful yet some cars look sexy, handsome and provokingly alluring because of their mechanical design for example the Bugatti, Bentley, just to mention a few. Therefore, the economic value of products as a source of competitive advantage has lost value. On the other hand, aesthetic value can be very challenging for companies because the more they integrate aesthetics into their products, the more customers place higher expectations thereby leading to sustainability challenges as more and more resources are SCCV- Essay Pair Makichi, Christine Netsai & Adadzewa Otu, Keziah needed to produce more of the sensory appealing products as we shall in the next section of the essay. Brand Perception as Aesthetic Value Attention to brand value is also linked to aesthetic experiences. Perception of brand is a major source of competitive advantage which is observed in today’s world. It is driven by aesthetics value. Customers would want to have an experience of the brand, for example in the retailing industry there is the popular one “Walmart Experience”. For Starbucks coffee one will notice statements like “Everything here is best-of-class.” The smell of coffee is appealing and inviting. In social media there are popular social media website experiences which every person desires to belong to, such as FaceBook and Twitter. In the accounting industry, there are the “BIG FOUR” First mover advantages are experiences related to pervasive brands with aesthetic value for customers making their world unique and special; communicating elegance, power, heroism, wealth and so forth. However, strategists have noticed how competitive strategies can be linked aesthetic value to improve the dominance of their brands. Competitive advantage is no longer about mass production to benefit from economies of scale and scope. It is about making the product appealing to the sensory feeling to enhance the prestige, boosting morale and improving the experiences of the consumer as a source of competitive advantage. Getting closer to home in the motor industry here in Sweden, Volvo brand registered in 1911, is a prominent Swedish Multinational company which specializes in manufacturing and sales of trucks and construction equipment. The Volvo brand perception has been well known for safety of “poor Volvo drivers” who are supposed to be protected from other road users by indestructible dull tank-like vehicles (www.qualtrics.com). The shift from economic value in automobile vehicles reveal the transition towards aesthetic value as Volvo vehicle designs were transformed to reflect a new appealing image which is sleek and fashionable Scandinavian vehicle which maintained its top of the range safety brand with unique experiences for the consumer competing with Mercedes-Benz, BMW, and others. An analysis of the transition in Volvo Brand aesthetically reflects how competitive advantage is shifting its form from time based competition which is driven by flexible manufacturing based competition alluded to by Stalk (2016). The view of the authors is that competitive advantage is no longer about rapid production of physical goods and services as a critique towards views of Stalk (2016), competitive SCCV- Essay Pair Makichi, Christine Netsai & Adadzewa Otu, Keziah advantage is now about circumventing the physical aspects to concentration on the intangible and emotionally appealing aspects of the products. Competitive advantage is now about the introduction of new meanings of the products by way of focusing on the perception of the product by the consumer. This changing nature of competitive advantage might leave the reader with the question about what would be the next source of competitive advantage given the transformations that have been noticed so far since the classical periods where competitive advantage was centered on mass production to enjoy economies of scale and scope to time based competition or multidimensional invention contexts in smart phones which operate in ecosystems. The future of competitive advantage is anticipated to be vicious. Aesthetic value of products and services which seems to be the current source of advantage will shift its dimensions to another level which the reader’s imagination might not comprehend. For example, in the mobile phones industry, aesthetic value has driven the appearance of mobile phones to reflect sensory appearances such as masculinity, femininity, unique characteristics just to mention a few. Some of the characteristics have driven the price of mobile phones to low and very cheap unimaginable levels that for the manufacturer to enjoy competitive advantage, the only way to survive is through modifications associated with sensory perceptions. However, the beauty aspects are the prime sources of competitive advantage currently. Viewing from another dimension of intangible source of competitive advantage, ethical value should not be ignored. Ethical value is mostly reflected through the reputation of an organization. When an organization is perceived to possess a good reputation, it emotionally attracts stakeholders to be associated with the organization. A good reputation implies trust, responsibility and good ethical behavior. Competitive advantage of an organization is derived when it acts responsibly to earn mutual trust and respect from its publics through value creating activities. This is an area which is very difficult to be imitated, thus creating a prime source for competitive advantage. If an organization is unconscious of its ethical values it might lose competitive advantage due to bad reputation, lack of trust and lack of confidence from its stakeholders. A very good example to reflect how corporate failure was a result of bad ethical value is the downfall of one of business giants like World Com, Enron and others due to lack of stakeholder trust. Thus, it is worthwhile for an organization to be cognisant of how it is perceived by its stakeholders so as to improve on its competitive advantage, otherwise it wakes up with its reputation down the drain and eventually draws criticism from its publics. SCCV- Essay Pair Makichi, Christine Netsai & Adadzewa Otu, Keziah Darker side of Aesthetics Considering the aesthetic notion which could either be positive depicting beauty or negative which implies ugly. Organizations are set to benefit from positive aesthetics while negative aesthetics have its own adverse effect. The darker side in relation aesthetics in this essay concerns the negativity of aesthetic. However, this creates more uncertainty on the future of sources of competitive advantage as the authors’ estimate that economic value will become a source of competitive advantage due to scarcity of raw materials such that supply and demand will determine the prices of goods and services. The idea of negative aesthetics is something worth consideration due its powerful impact to influence one's decision towards products. Negative aesthetics could result in misplacement consumers' purchasing decisions and it creates unnecessary wants! Impulse purchases drive sales margins, but also leads to high spending power and unnecessary scarcity of resources. This in the long run affects consumptions of the customers which also affect the organization in the long run as well. An example to consider is Apple and their constant introduction of their yearly new iphones. These new iphones are designed to add beauty to the precious existing phones with just slight changes from the previous model. As consumers buy the newly introduced product (Iphones) with slight modifications to appeal to the sensory perception of customers and consumers, they often come to a realization that the new product is no different from the previous version.This perception thereby affects their decision towards the new product introduction hence quickly causing less desire to buy which could affect the competitive stance of Apple. This shift of interest shows how customers' emotions and cultural values should not be taken lightly by organizations that have shifted focus to aesthetic value. Hence a negative aesthetic is something worth reconsidering. Success traps alluded to by March (1995) is one issue worth revisiting when competitive strategies are linked to aesthetics. As already mentioned above, aesthetic value as a source of competitive advantage is a short term measure which requires continuous planning for the business to counter disruptive technologies and stay competitive. The organization keeps trying several endless attempts leading to failure traps, ideas are abandoned before favorable long term results are generated. On the other hand, the organization focuses on business activities which it succeeds most leading to an endless cycle of success creating success traps March (1995). SCCV- Essay Pair Makichi, Christine Netsai & Adadzewa Otu, Keziah Furthermore, due the fact that most organizations are shifting to aesthetic value, there is high competition among industries to produce beautiful and eye-catching products. This high competition amongst organizations to come up with stylish designs has its own negative effect on the organization in terms of investment. Organizations are set to suffer from high levels of investment as they seek to compete on the existing and new market. An example to consider is the competition that is going on between Apple, samsung and Huawei who are all striving to win consumers and customers' hearts by sticking to their products. Thus, negative perception is likely to sway one loyal brand customer to another. In as much as Apple tries to satisfy its customers, Samsung is always on their heel with their products. Arnold (2011) emphasizes that negative aesthetics ranges from its severity and its impact on organizations. To expand on this notion, environmental and social conditions have an impact on our perceived beauty and how an organization is being impacted by environmental conditions could result in aesthetic rebuff. Irrespective of the fact that organizations strive to create sensory experiences in the form of aesthetics to win customers, there is the darker side of aesthetics faced by most organizations and their customers. As already pointed out about what aesthetic value is and the essence of sensual attributes informed by perception, critical judgement by one's perception can have negative influence on aesthetic value. Such critical judgement distorts one's appreciation for aesthetic value which could result in failure to absorb the magnificent beauty portrayed by aesthetic value (Arnold 2011). This critical judgement induces organizations to produce stylish designs resulting in high expectation demand. Customers and consumers' high expectations are set to push organizations' production cost high up due to the need for uniquely high innovative demands. The aviation industry is one industry which is worth considering in this regard. In the term of the airliner preference, the Boeing Max which was released with its aesthetic beauty winning many hearts can be seen as less desirable irrespective of its aesthetic value which is as a result of its negative aesthetic and criticisms.The negative aesthetics by Boeing has seen market shares dropping drastically over years with the perception that the Boeing Max is unsafe to fly with. Achieving a competitive advantage with a negative aesthetic is not likely feasible because emotions and perceptions which inform decision making cannot be swayed by unfactual, unjustifiable and ugly sentiments. Negative aesthetics is rather set to SCCV- Essay Pair Makichi, Christine Netsai & Adadzewa Otu, Keziah weaken one's position on the market and likely loss of brand loyalty. Customer satisfaction with respect to aesthetic value creation is key. Conclusion Nevertheless, where are we heading to as far as competitive advantage is concerned? Are the current industry giants who seem to be far ahead with competition likely to exist in the future? Apple, Boeing, Samsung, Google, Facebook, Walmart, Netflix and many others mentioned above, will they survive in the next generation of competitive advantage? Does that mean economic value is likely to lose its significance? These questions are ever present as the authors sought to bring to the fore the ever-changing nature of competitive advantage in which aesthetic value seems to gather momentum. The level of uncertainty seems to be high as resources run dry. Aesthetic value seems temporary and rather short term to base competitive strategies as consumer tastes change constantly. The issues of sustainable development seem to give direction towards where the future source of competitive advantage lies. Economic value will set in once more in future as a source of competitive advantage. Word Count: 2643 SCCV- Essay Pair Makichi, Christine Netsai & Adadzewa Otu, Keziah References Arnold B. ( 2011). Negative Aesthetics and Everyday Life. Aesthetic Pathways, Vol. 1, No. 2, pp. 75-91. March, J. G. 1995 The Future, Disposable Organizations and the Rigidities of Imagination. Organization, 2(3-4): 427-440. Stalk, G. (2016). Time-Based Competition. Palgrave Encyclopedia of Strategic Management: 1-3. London: Palgrave Macmillan UK. Whittington, R. (2012). Big Strategy/Small Strategy. Strategic Organization, 10(3), 263-268. https://www.theguardian.com/technology/2004/nov/13/motoring.automotive https://www.walmart.com https://www.starbucks.com
