A close competition is the rivalry between two similar companies that offer alternative products to one another. For completion to qualify to be a close competition, the two companies involved must be big enough financially and physically. In a close competition, the two players overshadow the presence of other organizations within the industry. Close competitors invest a lot in marketing to ensure that their brands remain in the minds of the consumers at all times.
The characteristics of a close competition include the symbiotic relationship between the competitors. In a close competition, the success of one company amounts to the success of the competitor. The competitors help one another to innovate and create different tastes to match the consumer taste. At times, it is safe to say that in a close competition, organizations copy strategies from their competitors, thus benefiting the consumer. Additionally, a close competition is characterized by a difference in brands among the competitors. Although the products and services that the competitors offer serve the same purpose, the companies involved have different brands to differentiate the products. The difference of the brand makes the products differ, although they serve similar purposes within the market (Manion 96). Lastly, close competitors serves within the same territories, thus intensifying competition and the quality of the products.
The Coal War’s Evolving Structures
The four participants in the Cola industry include the concentrate producers, the bottlers, the retail channels, and the suppliers. The concentrate producers package the right ingredients for the cola productions and send it to the bottlers for final assembly. The concentrate producers play a major role in determining the content and the ratios of the cola drinks. Additionally, the concentrate producers assist the bottlers in advertising the products and the distribution of the same. The bottlers on the other hand package the mixture into the can and bottles ready for consumption. The bottlers also add the carbonated material and in some case the sweeteners to the compound before packaging it. The bottlers just as the concentrate producers invest in the marketing of the products directly to consumers and in the retail stores (Bodden 83). The bottlers and the retail channels work together to market and supply the products to the consumers.
The concentrate producers negotiate prices with the retailers on behalf of the bottlers. Lastly, the suppliers interact with the three other players at different levels. The concentrate producers acquire certain products from the suppliers and so do bottlers. The retailers work with the suppliers to distribute the products to the consumers. The cola and the Pepsi companies change their control of the bottling companies depending on the economic status of the nation. The approach helps in limiting losses and assuring the success of the companies in the market.
The cola wars have lasted for several decades and continue to be a point of concern in the carbonated soft drink industry. During 1970’s, Pepsi won the war over cola for the very first time. Pepsi diversified its marketing and advertising efforts, which allowed the company narrowly to defeat cola in sales and profitability. Pepsi worked closely with the concentrate producers, which allowed the company to sell its products cheaply to the bottlers. Consequently, Pepsi decided to use the profits acquired from this deal to market and promote its products to a wide range of markets.
However, in 1980’s, Cola rose to power by switching from sugar to high fructose corn syrup. The syrup was cheaper than sugar and was readily available to the company, thus enabling cola to cut the prices of its products. Consequently, cola intensified its marketing rather than doubling the advertising spending, hence improved rates of profitability. In 1990’s, Pepsi won the war by investing in promotion and the creation of new products such as the diet products (Bodden 164). Lastly, in 2000’s, cola won the wars through refranchising and owning bottling companies. Imitations and innovation helps to balance competition and guarantee the production of quality products. The coal wars squeezed small bottler and concentrate producers out of business.
The major challenges to cola and Pepsi in the mid nineties was the shift in the consumption patterns of the carbonated soft drinks. The products were linked to health issues, especially obesity, which is a major problem in the western nations. The outlets that distributed these products became rather costly, thus interfering and affecting the profitability levels of the companies. Additionally, schools banned the sale of sodas around the vicinity of the institution, thus limiting the number of consumers. Governments imposed heavy tax on the products, therefore, limiting the growth of both Pepsi and cola. Both companies responded to the situation by investing in innovation and marketing. Cola introduced a freestyle soda machine, which offered a variety of choices for the consumers (Bodden 79). Additionally, cola spend a considerable amount in the promotion of its brand. On the other hand, Pepsi redesigned its logo to accommodate snacks and beverage. The approaches were successful and they allowed the companies to rise to their original levels in the market. However, in the future, the companies must invest in a more concrete solution to deal with problems before they occur. The companies must be able to anticipate future challenges and devise strategies in advance. The current foundations of the companies can guarantee success in the future endeavors hence no need for new foundations. The coca-cola company has a higher chance of winning the cola wars based on history and the progress of the company.
Example of a Close Competition
The war between Nike and Adidas represents an example of close competition. Both companies serve the sport and the athletic market and their products are the best in the market. Nike and Adidas are the two major companies that offer sport people the right foot ware. Their competition has affected the other companies within this industry negatively, thus leaving the market in the control of Nike and Adidas. The competition between these two companies intensifies during the athletic seasons and mostly after every four years for the champion’s league.
The companies choose different players from known teams and localities to advertise and promote their footwear. During the 2014 cup, both the companies had the best players from the three wining nations of the champions league to showcase their products. However, Nike seems to win all the time for various reasons. First, Nike has invested a lot in social media marketing which has given the company a competitive edge over its greatest rival. On the other hand, Adidas prefers to promote its products through official partners. Although both approaches were successful at the end of the day, the use of social media seems to be more effective for this kind of business (Marquis 685). Nike has more likes on Facebook as compared to Adidas, which indicates that most players at different levels are bound to use Nike footwear occasionally.
Summary of a Wining Close Competition
Winning a close competition is a rather hard task because of the many similarities that exist between close competitors. Therefore, the success of one organization over the other is embedded in the organization’s management structure. The leadership and the ability to maintain a certain level of commitment to the public differentiates winners from losers in a close competition. Different management and leadership theories help leaders within organizations to manage situations during a close competition to achieve success. Strategic management is an essential ingredient of winning a close competition. The war between cola and Pepsi continues to thrive because both companies continue to advance their strategies day after another (Bodden 154). Winning a close competition requires an organization to have a clear brand that cannot be imitated by other organizations. Additionally, a successful organization in the close competition must have a competitive advantage over its competitors. The ability to make decisions based on the situations at hand plays and ideal role in creating a competitive advantage. The categorical theory of management helps leaders within an organization to decide the best approach to employ in creating a competitive advantage.
On the other hand, the coordination of efforts among the workers plays a great role in winning a close competition (Manion 69). Creating a customer database and establishing an ideal communication with and to the consumers helps in winning close competitions. The internal employees must be motivated and willing to work towards the success of an organization. The x and the y theory can help in motivating employees to promote the goals and the objectives of the company. In the case of cola and Pepsi, the lack of coordination between different players such as the bottlers or the retailers has a negative impact on the position of the company within the market. An ideal relationship between the four players in the Cola industry translates to highly satisfied consumers hence success in the close competition. One of the areas that suffer greatly during a close competition is the profitability of the company. To maintain the market share, companies choose to cut down their prices to a level that is not desirable on the company’s part. Therefore, achieving high levels of consumer satisfaction helps to bring the company back to its position in the market.
Innovation is becoming the essential ingredient for success in the current world. At Indian university, the institution can employ several strategies to improve the innovativeness of students at different levels. First, the instructors need to encourage discussion in classrooms to allow students think and express their ideas to one another. The discussion allows people to think outside the box. Therefore, it will enhance the innovative skills of the students (Marquis 678). Consequently, the institution should encourage students to engage in scientific innovations and group inventions.
Scientific innovations are the backbone of technological developments. As such, this will place the students in a better position in handling the challenges of innovation in the future. The friendship patterns of the students in the Indiana University are similar to those of other universities. Students relate with those who are similar to them, thus reducing the cohesiveness of the institution. Social media such as Facebook has a great impact on the behavior of students (Marquis 681). At the Indiana University, the students prefer to communicate via social media rather than physical relationships. The growth and the success of the Facebook interactions have influenced the physical relationships of students in the university. Social media can help enhance innovation by allowing students to learn more from the internet.
The Strength of Weak States
The major strength of a weak state is the controlled involvement of the government on business matters. Conducting business in such states is much easier because the control of the market is purely in the hands of the executives. Regardless of the financial challenges experienced in such states, the business people have the advantage of reaping maximum benefits without the states’ interference. Additionally, the entry to such states is much easier than in stable nations (Marquis 680). On the other hand, a weak state can easily be influenced by the surrounding thus allowing change to influence the lives of people. Strict laws and regulations hinder developments at some point because they prevent the assimilation of new ways of operation at different levels of life. As such, a weak state benefit from the surrounding environment greatly thus improving the levels of profitability for those involved in economic activities. A weak state allows diversity at different levels. The interaction of different people within the states helps to protect the state from its enemies, thus achieving better security than its counterparts do.
Marquis (655) defines imprinting as the process through which a concept resonates across different levels yet preserving the specific originality. Additionally, he argues that imprinting is the ability of a concept to last a lifetime, regardless of the changes that occur within the environment. The concept was first used in biology, where animals would follow a certain habit regardless of the geographical location or the changes within their environment. Imprinting evolved to the organizational set up as people observed certain trends among companies that were invented or launched during the same era. In general, imprinting is the ability of a concept to withstand the test of time and give an object a sense of identity (Marquis 655). The process of imprinting can be divided into three segments. First, imprinting starts as during a weak point where the focal point is sensitive to the external environment. Secondly, imprinting occurs as the elements of the external environment embed on the focal point during the sensitive period. Thirdly, the imprint persists over a lifetime, regardless of the changes in the environment.
An imprint has several impacts on the organizational design. The imprint dictates the various ways that people within the organization conduct business. For instance, an imprint dictates the process of staffing and leadership. The consistency in the ways of operations raises the effectiveness and the efficiency of employees within the organization. Additionally, an imprint dictates the behavior and the attitudes of employees within the organization. Further, the uniqueness in business transaction helps to create an ideal image of the company in the minds of the consumers.
Ecology, Niche and the 70-20-10 Rule
The 70-20-10 rule is the most effective management tool that guides the leadership and staffing of employees within an organization. The rule suggests that people best learn in practicing rather than learning in class. The 70 percent of what a human brain retains is gained through the actual practice and the doing the activities for which they are being trained. The twenty percent is gained by interacting with the leaders while ten percent is gained through learning and education training (Manion 71). Ecology and niche refer to the relationship between an organism and its surroundings. The same principle applies to the 70-20-10 rule where an individual is able making use of the advantages presented to them by the virtue of being a member of a certain network. The challenges and the struggles help to eliminate the weak and single out the successful organisms.
An isomorphism is the similarities and the identity that exists between the process and the structure of one organization to another. The similarities occur because of various reasons, some of which are voluntary while others are mandatory. Isomorphism can be divided into three segments depending on the causes of the similarities. First, mimetic isomorphism occurs when an organization imitates the process of operation of another organization for lack of better strategies (Manion 45). For instance, when a learning institution hires certain people to copy a strategy employed by a successful learning institution, the similarities are mimetic. Normative isomorphism is a similarity that results from the professional aspect of the business. Organizations that hire professionals from similar training institutions are bound to have similarities in operations. A good example of normative isomorphism is hospitals. Lastly, the coercive isomorphism happens when organizations are forced by the law or the constitution to conform. For instance, a manufacturing company with subsidiaries in various parts of the world will demand that the subsidiaries function in a similar way.
Bodden, Valerie. The story of Coca-Cola. Mankato, MN: Creative Education, 2009. Print.
Manion, Jo. From management to leadership strategies. San Francisco: Jossey-Bass, 2011. Print.
Marquis, Christopher. “The pressure of the past: network imprinting in intercorporate communities.” Administrative science quarterly, 48 (2003): 655-689. Print.