Starbucks is a textbook case of a company that has successfully secured a competitive advantage over its competitors. Companies tend to copy the best practices of their competitors. In a coffee enterprise, the value chain would be – sourcing ingredients, making coffee, customer service, maintaining health and hygiene in outlets, store design, branding, marketing, logistics, and distribution.
Each component in the value chain has a set of activities. Competitors seek to copy the activities and operational processes of the market leader. As they copy the gap between them and the leader starts disappearance. A time comes when there is no difference in competitors’ activities and operational processes. This state is called strategic convergence.
Competitive advantage is secured when a company has activities that cannot be easily copied by competition. While the value chains of Starbucks and its competitors may be similar, activities and their inter-relationships are different. Starbucks continues to stay ahead in strengthening and building upon its value chain and activities, making it difficult for competitors to replicate their activities.
All those companies who have succeeded in building an activity network that competitors find difficult to copy will continue to stay ahead. Therefore, it is important for corporate success, to develop their unique value chain and activities that others find difficult to replicate. As long as they succeed in achieving this, they will remain competitive. Starbucks, Airbnb, Walmart, Southwest Airlines, Amazon, Google, Facebook, have all succeeded in achieving this. It is for this reason these companies are market leaders.
About the author:
Professionally certified in business strategy