2.2 Organisations can gain competitive advantage through three factors: differentiation, low cost leadership and response. Using organisation/s of your choice, discuss how that/those organisation has/have done remarkably well in gaining competitive advantage in those three factors.(9)
2.3 Define quality according to the following three perspectives:
2.3.1 User-based
2.3.2 Manufacturing-based
2.3.3 Product-based[25]
The correct answer and explanation is:
Answer for 2.2: Competitive Advantage through Differentiation, Low-Cost Leadership, and Response
Organisations can gain a competitive advantage by excelling in three areas: differentiation, low-cost leadership, and response. Let’s examine how Apple Inc. has successfully leveraged these factors:
- Differentiation: Apple differentiates itself through innovation, premium design, and a seamless ecosystem. Its iPhones, MacBooks, and iPads stand out due to their superior user experience, high-quality materials, and exclusive iOS/macOS ecosystem. Apple’s marketing also emphasizes exclusivity and prestige, making it a desirable brand.
- Low-Cost Leadership: While Apple is known for premium pricing, it manages costs efficiently by outsourcing manufacturing to countries with lower labor costs, such as China. Apple also leverages economies of scale and supply chain optimizations to keep production costs lower while maintaining high profit margins.
- Response: Apple quickly adapts to market changes and consumer needs. For instance, it introduced the M1 chip to enhance performance and efficiency, responding to increasing demands for better computing power. It also swiftly releases software updates to fix security flaws and add new features, ensuring customer satisfaction.
Through these strategies, Apple has maintained a strong market position and continued dominance in the tech industry.
Answer for 2.3: Definitions of Quality
- 2.3.1 User-based Perspective: Quality is determined by how well a product or service meets customer expectations. From this perspective, a product is considered high-quality if users find it satisfying, durable, and reliable. For example, a smartphone with an excellent camera, long battery life, and smooth performance is perceived as high-quality by users.
- 2.3.2 Manufacturing-based Perspective: Quality is defined by conformance to specifications. If a product is made without defects and adheres strictly to production standards, it is considered high-quality. For example, a car manufacturer ensuring that every vehicle meets precise safety and efficiency standards signifies quality from a manufacturing viewpoint.
- 2.3.3 Product-based Perspective: This perspective focuses on the measurable attributes of a product, such as durability, performance, and features. A high-quality product has superior materials, advanced features, and better longevity. For instance, a laptop with high RAM, a fast processor, and a high-resolution display is considered superior in quality.
