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Why competitive strategy is part of an online MBA program

Key to the success of building and growing a successful enterprise is the ability to offer a sustainable advantage over competitors. That idea is the core of competitive strategy. A robust online Master of Business Administration (MBA) program gives you the tools and knowledge to understand and implement competitive strategy. Michael Porter, the author of Competitive Advantage: Creating and Sustaining Superior Performance, identified two types of competitive advantage:

  • Cost advantage
  • Differentiation advantage

A competitive advantage exists when the entity is able to deliver the same benefits as competitors but at a lower cost (cost advantage), or deliver benefits that exceed those of competing products or services (differentiation advantage). Competitive strategy is at the heart of how you use competitive advantages to offer better value to your customers, in turn leading to higher profits for your company.

Competitive strategy opportunities exist across an organization  

You don't have to be part of a specific team to look for and develop competitive advantages within an organization. Executives and managers who lead teams in marketing, product development, customer service, business operations and human capital each have a role in developing and executing competitive strategy. Tools that can be used to develop either a cost advantage or a differentiation advantage include:

  • Patents and trademarks
  • Proprietary knowledge
  • Customer base
  • Ease of doing business
  • Reputation of the firm
  • Brand equity

Typically, a firm positions itself in its industry through its choice of low cost or differentiation. This decision is a central component of the firm's competitive strategy. Online MBA programs teach students how to understand and effectively execute these core competencies, while helping them understand how each of these areas of operation can be utilized to competitive advantage. Each falls within a value chain that serves as a framework for diagnosing and enhancing competitive strategy. In addition to the organization's own value-creating activities, vertical activities, including those of upstream suppliers and downstream channel members, create continual opportunities for value creation and leverage. Within an online MBA program curriculum, you can learn how to differentiate with the buyer's value chain in mind and study buyers' perception of value and signals of value. You very well may spend time digging into the increasing role of technology in driving competitive advantage. You'll likely learn how to deploy both defensive and offensive competitive strategy. Organizations, whether for profit or not-for-profit, are dynamic and ever-changing, as is the marketplace and economy in which they operate. Within this dynamic environment, online MBA program students are taught to consider, evaluate and employ competitive strategy and techniques in their particular area of expertise. It is one of the value-add dimensions of the graduate business education curricula that can equip MBA graduates to contribute to their companies at a higher level.


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