PRE-EMPTIVE STRATEGY

By:Ahsan Moin Siddiqui ISBE/A/SS

Introduction
Having a competitive advantage is necessary for a firm to compete in the market But what is more important is whether the competitive advantage is sustainable A firm must identify its position relative to the competition in the market By knowing if it is a leader, challenger, follower or nicher, it can adopt appropriate strategies to compete

Sustainable Competitive Advantage not only to A good strategist seeks

win the hill, but hold on to it. Sustaining competitive advantage requires erecting barriers against the competition Aakers suggested looking at the following:
How you compete Basis of competition Where you compete Whom you are competing against

What is Preemptive strategy.

Preemptive strategy is acting against competitor before the competitor makes its move. This is one of the most difficult strategy as competitors steps are difficult to guess. This one of the most powerful strategy as to again competitive advantage over our competitors. Future oriented it attacks the competitors intention to gain advantage.

Examples.
Locking up capacity:- Anticipating the growth
in the market about 3.5 inch disk. Sony announced a five fold increase in the production capacity. thus making its competitor IBM drawback in increasing the production capacity.

Locking in markets :-Gillette moved its brand

sensor in 19 countries and P&G launched Pampers in 90 countries. Thus rapid propagation made it difficult of the competitors to toehold market globally. Also SBI presence in the rural segment is effort of preemption.

Locking up Minds.:-The companies effort to

block the thinking process of the customers and announcing the upcoming of their product way time before. So customers wait for this promised product. Film Industry launching promos of their movies way before. Tata promising launching jaguar.

 Blocking a competitors intended action:- Tata Indica working on mileage more

aggressively in order to block the intention of Maruti as most economical car. Apple sue Google Android for their technology breach. In order block Google for further enhancement in the market.

Devising a Preemptive Strategy.

Determine where the market or the competitors are moving or might move. Determine strategies to reach there first or block their efforts to reach there. Determine whether the strategies planned are feasible and consistent with the firms current goals .

Preemption Process

Evaluation of strategy.
Competitors strategy Criteria

Preemptive stratigies Consistency with objectives feseability Likely effect on competitors

..

Permanent

Sustainable

Competitor abolishes Plan

Duration of Impact

Impoverish Short term Magnitude of Impact

Un sustainable

Minimum

Maximum

Thank you