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Business: How To Manage Competitions

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Business: How To Manage Competitions

In business, the competition is defined as a contest in which two or more businesses attempt to attain a specified objective at the same time with different approaches. Competition is a struggle for a more desirable objective where two or more competing parties try to attain a pre-determined common goal that may not be shared: where the gain of one is the loss of another. Competition can occur between firms, including firms in the same market segment, organisms, individuals, social and economic groups, and so on. Competition is also a process of coordinated effort where the same production processes, methods of operation, products, prices, and terms are applied by numerous firms to achieve some common result.

Business must compete to stay in the business. Therefore, companies must use all possible tools to remain on top of their competitors, including research and development, marketing, quality, service, and the structure of their operations. To stay ahead, the business must work to develop best-practices in all aspects of their businesses including product, information, service, marketing, and leadership. In addition, businesses must also compete on an international level and stay competitive by adopting international practices such as mergers and acquisitions, offshore outsourcing, free trade areas, and localization. Additionally, the business must compete against larger firms that have scale advantages through technological superiority, resources, and network effects.

Competitions can take many forms, ranging from simple competitions (i.e. internal and external competitions) to more complex competitions (i.e. organizational and structural competitions). The key is to identify the right form of competition and learn from past and current examples of how to conduct business effectively while using best-practices as a competitive advantage.

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