Gottfredson et al., 2008 - The Starting Point - Competitive Position

6 important questions on Gottfredson et al., 2008 - The Starting Point - Competitive Position

What is one of the strongest predictors of a company's performance?

Its relative market share (RMS).

Often there is a correlation between two important factors for an organisation within its industry, which two factors are these?

A correlation between RMS (market share) and ROA.

What does a correlation between RMS and ROA reflect in terms of a market leader?

Market leaders typically outperform market followers on ROA.
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As leaders have higher accumulated experience, what does this mean for the costs and customer insight?

Costs go down, probability index (project's or investment's attractiveness) goes up.

What are other two important assessments that can be made to look at your position as opposed to your competitor?

  • Assess market size - compare revenues (per segment) with competitors
    • Best is to assess over time to show growth
  • Assess your capabilities - what are your strengths and weaknesses?
    • Intangible capabilities are generally more important than ownership of assets

What will the capabilities of the firm show you?

Your company's chances to achieve its full potential, to improve its position on the band chart.

The question on the page originate from the summary of the following study material:

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