In the world of business and industry competition is inherent with business and industry step movement. This is due to the presence of five forces that constantly push their every step.
The five forces, was developed by M.E. Porter, “Competition from suppliers of substitutes, the threat from entrants, competition from established producers, and the bargaining power from suppliers and buyers.”
When a business or industry is successful and won the competition, then there are two criteria must be met: first, “The company must supply the customers want to buy”; second, “The company must survive the competition.” Therefore there are two simple questions in relation to the success of the above two criteria, namely:
1. Is it needed by the customers?
2. What must be done in order to survive in the competition?
Concept of Strategies
Strategy is a comprehensive plan that integrates all resources and capabilities that have long-term goal to win the competition. So the strategy is a plan containing a comprehensive and integrative manner that can be used as handles to work, fight and do in order to win the competition. Here are some definitions of strategy formulation varied though, but the characteristics and elements are essentially the same.
This strategy has historically concept is derived from the military, as expressed by Von Neumon and Morgenstern in his “Theory of Games” which contains the theory and strategy concepts. From this concept is later in applied into the world of business and other life such as politics. Thomas Schelling developed a study titled “The Strategy of Conflict” that expresses various elements of a common strategy found in many aspects of life in a competitive situation. These common elements are the principles in bargaining, threats, mutual distrusts, and the balance between cooperation and conflict.
In subsequent developments, especially in this era of globalization management strategy is a powerful instrument and cannot be avoided, not only for survival and win the competition but also to grow and develop.