Background

Theories and principle were attributed to as drivers and motivators constantly reminding business
managers to be concerned with addressing the challenges of competition in the business and
consideration for strategic management as well. A variety of theories and principle that drive
business managers and strategist to be creative, innovative and skillful in terms of outcompeting
or edging out its rivals in the business, some of them stand out that the rest.

Porter’s competition model

Michael Porter has made substantial contribution in field of strategic management via his
becoming business competition model which originally comes in five major forces; hence the so-
called Porter’s five Forces Competition Model. It is become the popular theory in business
management in general and field of strategic management in particular. The theory advocates
that other than the competition and rivalry among business organizations producing or selling the
same or similar product in the same market sector ire segment there are these factors outside of
traditional perception of competition in the business planning but the unique opportunity for
practicing strategic management. The kind of competition expounded by Michael Porter goes
beyond the domain of price, kind and quality aspects as dominant factors in competition. The
model included five major forces but has been expanded to include another important force
lumped into what called stakeholders group.
Rivalry among Competing Seller

Rivalry among sellers or producers constitute the traditional view of business competition and
this is positioned in the middle block in Porter’s business competition model refers to the key
players or direct competitors within the industry or sector offering the same or similar products
or services.

Rivalry among competing sellers is the most powerful and important aspect of Porter’s
competition model. Michael Porter points out that the big factor determining the strength of
rivalry is how actively and aggressively are rivals are rivals employing the various weapons of
competition on jockeying for stronger market position and seeking bigger sales. Thompson and
Strickland identified the matters of utmost concern; in this group are the following issues:

a.) Is the price competition vigorous

b.) Active efforts improve quality
c.) Are rivals racing to offer the better performance features;
d.) Are rivals racing to offer better customer service
e.) A lot of advertising/sales promotions
f.) Active efforts to build a stronger dealer network;
g.) Active product innovations; and
h.) Active use of other weapons of rivalry

What causes rivalry to be stronger?

It may be strong or weak depending on certain conditions. Among the factors that result to strong
or active rivalry and competition among businesses engaged in similar products or services are as
follows:

a) Active jockeying for position among rivals and frequent launches of new offensive gain
sales in the market share;
b) A number firms that are relatively equal in the size and capability
c) Slow market growth;
d) Industry conditions tempt some firms to go on the offensive to boost volume and market
share;
e) Costumers have low costs in switching the rival brands;
f) A successful strategic move carries a big payoff;
g) Costs more get out of business that to stay in; and
h) Firms gave diverse strategies corporate priorities, resources and countries origin.