Learning Objectives To learn the methods that a

firm might employ to successfully achieve each of the four building blocks of competitive advantage

Achieving Superior Efficiency

Economies of scale Learning effects The experience curve Flexible manufacturing & mass

customization Marketing Materials management & JIT

Achieving Superior Efficiency (cont)

R & D Strategy Human resource strategy

- Hiring strategy- Employee training

- Self-management teams - Pay for performance

Information systems Infrastructure

Achieving Superior Quality: Attaining

superior reliability Build organizational

commitment to quality Create quality leaders Focus on the customer Identify processes and the

source of defects Find ways to measure quality Set goals and create incentives

Achieving Superior Quality: Implementing

TQM

Solicit input from employees Build long-term relationships

with suppliers Design for ease of

manufacture Break down barriers between

functions

Achieving Superior Innovation

High failure rates - Uncertainty

- Poor commercialization - Poor positioning strategy

- Technological myopia - Being slow to market

Achieving Superior Innovation (cont)

Building competencies in innovation - Skills in basic and applied

research - Project selection

and management - Cross-functional integration - Product development teams - Partly parallel development

processes - Learn from experience

Achieving Superior Customer

Responsiveness Focusing on the customer

- Demonstrating leadership- Shaping employee attitudes

- Bringing customers into the company

Satisfying customers’ needs - Customization

- Response time