Chapter 2
Competitiveness Strategy and Productivity
Definition of Competitiveness:
Ability of a firm or a nation to offer products and services that meet
the quality standards of the local and world markets at prices that
are competitive
Businesses Compete Using Marketing
> Identifying consumer wants and needs
>Pricing ,Cost = set proper price of product
>Advertising and promotion such as via TV, radio,
magazine
>Product and service design, Flexibility
>Location
>Quality Service, Quick response and service quality
>Inventory management ,Supply chain management
>Managers and workers
Why Some Organizations Fail
-Neglecting operations strategy
-Failing to take advantage of strengths and
opportunities
-Failing to recognize competitive threats
-Too much emphasis in product and service design and not enough on improvement
-Neglecting investments in capital and human resources
-Failing to establish good internal communications and cooperation
-Failing to consider customer wants and needs
Planning and Decision Making
1.Mission =The reason for existence for an organization
-Mission Statement=States the purpose of an organization
2.Goals=Provide detail and scope of mission
3.Strategies=Plans for achieving organizational goals
4.Tactics=The methods and actions taken to accomplish strategies
5.Operations =The actual “doing” part of the process
Productivity
A measure of the effective use of resources, usually expressed
as the ratio of output to input
Productivity measures are useful for
Tracking an operating unit’s performance over time
&Judging the performance of an entire industry or country
Productivity =

Partial Measures
Output
;
Single Input
Multifactor Measures
Output
Ouput
Output
;
;
Multiple Inputs
Labor +Machine Labor +Capital +Energy
Total Measure
Goods or services produced
All inputs used to produce them



Output
Input
Ouput
;
Labor
Output
Capital
Factors Affecting Productivity