To increase its share of the market, an organization must take advantage of one of the two opportunities: (1) it must gain additional customers, either by garnering a greater market share or by findings ways to increase the size of the market itself; or (2) it must beat its competitors in entering and winning in an expanding market. In either case, the organization must analyze the competition and establish a clearly defined marketing strategy in order to provide superior customer satisfaction.
Airline companies such as American, TWA, United and US Air and their non-US counterparts are clearly competitors in the American air-carrier market. But competition can also come from organizations that provide substitute products or services. In the northeast corridor, for example, Amtrak metro-liners compete with the airlines by substituting for face to face meetings thus eliminating the need for travel in some situations.
In recent years, the competition facing US organizations has broadened to include non-US firms. In the 1950s, the label ‘Made in Japan’ implied junk or cheap by the 1980s it had become a hallmark of quality. The success of Japanese products, ranging from cars to cameras, has been enormous. Many products, such as VCRs, are not even made in the United States today, and there is competition from aboard in almost very US-dominant industry For example, Taiwan’s up and coming companies are supplying the world’s personal computer giants. These Taiwanese computer makers such as Twin head, First International Computer, and Compal are playing a critical behind the scenes role as designers and manufacturers of the world’s PCs and peripherals many of which are eventually marketed under more well known brand names. In the last few years, Taiwan has passed South Korea as the world’s top producer of color monitors. It also leads in computer mice and keyboards. Dozens of well known computer makers, including IBM, Dell, Packard Bell, and Apple are stocking up in Taipei with finished PCs and notebook computers. In 1992 the Taiwanese sales of hardware were $6.6 billion.
Other Stakeholders Groups: Each individual organization has a host of different stakeholders. For instance, a hospital will have to consider the American Hospital Association; groups of doctors, nurses, and other care givers; and of course patents. Every organization has a particular stakeholder map that is in essence a picture of the direct action component of its external environmental.
Even though, strictly speaking internal stakeholders are not part of the organization’s environment (because they are part of the organization itself), they are a part of the environment for which an individuals manager is responsible.
Employees: The nature of the work force is changing in most organizations partly because of demographic factors. The so called baby boom generation is getting older and the declining birth rate means that the United States wills soon face a labor shortage. At the same time the skills needed by employees are changing. As companies find it necessary to experiment with quality programs, team approaches, and self managed work groups, they need employees who are better educated and more flexible.
Shareholders and Boards of directors: The governing structure of large public corporations allows shareholders to influence a company by exercising their voting rights. Traditionally, however shareholders have been interested primarily in the return on their investment and have left the actual operation of the organization to its managers.
Moreover, direct ownership of stocks by individuals is on the decline; individuals are now more likely to hold shares through investments in mutual funds, contributions to retirement plans and membership in company and state pension plans. In fact, approximately 40 percent of the common sock of the country’s largest and many middle-size businesses are controlled by pension funds. These large blocks of shares are managed by professional who can emphasize financial performance putting greater pressure on managers to produce short term results. Recently the CEOs at General Motors, IBM, and Kodak among the reasons given were the inability of the CEO to adjust to the changing environment or to deliver needed changes quickly enough or an unwillingness to follow board direction.