Competitive Strategies in the Computer Industry

2. Theoretical-Framework And Research Approach

Competitive strategy of a firm is thought to be of major importance in its success in the industry (Gatignon & Robertson, 1989; Goolsbee, 2001; Kumar et al., 2011; Lawless & Fisher, 1990; Mathews, 2002; Porter, 2008; Prahalad & Hamel, 1990; Tambe & Hitt, 2012). These studies reinforce the importance of understanding different forces of competition. This is true for both incumbent and the new entrants. Bush (2012) asserts that developing an organization's competitive strategies is instrumental in staying ahead of the competition. Research has shown that competitive strategies need to be assessed from the standpoint of the threat of new entrants (which matters to incumbents), the bargaining power of suppliers (true for both incumbents and new comers), the bargaining powers of buyers, the threat of substitute products (matter of concern for incumbents), and rivalry among competitors (Porter, 2008).