Comparative Analysis of Models in the Competitive Market
Every rational individual acknowledges that businesses need to be competitive in order to thrive. My comparative analysis will recognize the various models used in the competitive marketplace and compare the end-results of these models. The four models that I will be comparing are: step checklist, transformation model, Mintzberg’s physiognomy, and the economic sector analysis. In line with my analysis I will also be using my experience as a sales marketer for Aramco Oil Company to provide key examples about how these fundamental processes occur on an every day basis.
When comprehending comparative models you must first understand that a model is simply a complex or systematic description of the competitive marketplace. These models are used to aid individuals in seeing the structure or design of the marketplace. Initially, we will focus first on the transformation model and its hand in the marketplace. Looking at the general word ‘transform’ you will see how wisely chosen this process is. To transform is to create something from a raw material. In this model, this transformation occurs when inputs are transformed to outputs. This process is a very high level look at the marketplace.
It looks simply at what manner of item when in to the system in order to procure a end result item. Almost like a circuit, it is the in-s and out-s which keep the market process in a continuous movement and growth. The more raw material which goes into a system the more outputs you expect to see. In my role, as a sales marketer of Aramco Oil Company I see this process every day.
The raw material of oil is processed to produce a high demand product, and thus the transformation process is a never-ending cycle. As a model though, this process does not account for all the idiosyncrasies or complex factors that play a role in the create of this high end product. In fact, the process is so high leveled that I see the Step Checklist as a much more logical look at the process (Armson, Rosalind, John Martin, Susan Carr, Roger Spear, and Tony Walsh.)
Of the four models being compared, the Step Checklist is by far the most organized in its structural intact and outlook on the competitive market. This checklist looks at the key influences in the competitive marketplace. It focuses on the social, technological, economic, and political influences by concisely breaking down various aspects of how, why, where, when, and what possible affects they have on an organization. Unlike the transformation model, this checklist supplies the analyzer with various possibilities to be on the lookout for when determining a course of action.
Furthermore, this checklist allows for a simplistic and widely applicable usage of these factors. Whereas the transformation model was a very board look at the inputs and outputs, this Step Checklist is a systematic perspective of social factors like demographics and age-groups. By looking at the technological components of the competitive marketplace, a company like my own has the opportunity to ensure that it is staying or making advancements along with the competitive other players.
Economic changes can be watched or statistically analyzed to make appropriate changes or adaptations should the competitive marketplace change. My company is a key player in the oil industry and must gauge how its future profitability will be at the best advantage. From a political avenue, this model is essential to make sure that all players in the competitive marketplace are aware of legislative policies or strategies that might affect the industry. Furthermore, politics has a constant role in policies changing or advancements. Should a sales representative like myself not account for this changes our clients will see that we are not staying in line with policies and perhaps be adversely affected by our lack of adhering to those policies.
This analysis of competitors is a means towards identifying the company’s competitors, understanding what their strategies are, recognizing their objectives, seeing how their strengths and weaknesses are seen in a checklist manner, and recognizing reaction patterns to those factors which affect the marketplace (Kotler 234-247)
Moving on to the Mintzberg’s physiognomy model, many analysts might see this model as highly subjective in origin. In comparison to both the Transformation and Step Checklist models, this model is dependent on looking at the power various players wield in the competitive marketplace or industry. This model stresses that there is a ‘cast of characters’ in an organization which ranges from owners to employees to special interest groups to various other entities. Based upon this model, we see a very visual representation of the marketplace. It is unique to see the differences between the models.
Transformation model is seemingly a process flow. The Step Checklist was created based upon influences and logically connects or affects upon the industry. Now here we have Mintzberg’s physiognomy’s model. What stuck out at me first is that physiognomy is clearly the study of a person’s palm to determine that individual’s fate. This destiny is determined based upon a higher source of power which dictates what is to occur in the future for that individual. Here this model looks at the ‘power’ play of what will determine the fate of the company based upon the various sectors which play a role in its maintaining profitability (Armson, Rosalind, John Martin, Susan Carr, Roger Spear, and Tony Walsh.).
It focuses primarily on the strategies or activities of these entities. These strategies or activities will overall affect the competitive industry in some manner. For instance, in my company should the owners fail to provide adequate compensation to the employees they can either strike or retain work elsewhere. If the company lacks adequately experienced employees it will fail to retain clients or creditability in the eyes of its public. This can potentially damage or hinder the economic profitability or continued success of Aramco Oil Company. If that occurs, as a sales marketer I will have a difficult time convincing others that the company is maintaining its correct directions and gross profit margins.
At this time, I will roll right into the economic sector analysis model. The competitive marketplace is built on the ideology of ‘economics’. This fundamental model looks at sectors, the environment, and markets. Without bumping the company against its competitors we will fail to recognize where growth or change is required. The sectors themselves compete amongst themselves and there are definite signs of where one company might be affecting or causing a chain-reaction within other companies. For instance, an EDI system allows for less manual maintenance.
If a company fails to make appropriate changes or does not advance itself like other, then the other companies in that particular sector will swiftly overtake its market shares. In the oil industry there is often a state of rapid growth and it is wise for a company to watch for such changes. Like the Mintzberg’s physiognomy, there is a look at the power players or influences in this model. The power look in this case is the economic sector and other players in that particular sector. All in all, measures must be taken to ensure that the marketplace is watched for its stability, and adversely if unstable occurrences are happening.
These models can all be used to determine how the competitive marketplace is doing and how to identify influences that affect it. In general, these models each have their strengths and weaknesses. In general each model can be used to analyze various aspects of the marketplace. This analysis can be broken down into the strategies used to determine how the marketplace needs to react as changes occur in it and around it.
Armson, Rosalind, John Martin, Susan Carr, Roger Spear, and Tony Walsh. Understanding Business Environments: Identifying Environmental Issues, 2000
Kotler, Philip. Marketing Management: Analysis, Planning, Implementation, and Control. Sixth Edition.
New Jersey: Prentice Hall, 1988