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What is competitiveness? [Strategy]


Every company is doing its best to improve its competitiveness in the market. Then we would need to ask ourselves what competitiveness really means. Almost everyone may be so familar to the word of competitiveness but when we are asked what it really means, not many people seem to cleary define it but often hesitate or wonder. Competitiveness can be defined in a number of ways. We often consider it as the long-term viability of a company. Sometimes, we define it in a short-term context by saying that it is the present success of a company in the market demestic or/and international, which is in fact well measured by market share in its related specific area or industry. Besides, when it comes to a nation competitiveness, we can think of collective competitiveness of a nation which can be measured by aggregating all the competitive success factors of a nation in all markets related. Thus, it appears not easy to define competitiveness unless the context of the competitiveness is in advance well advised. The following desciption can be regarded as a good reference for the definion of competitiveness, which was given by the U.S. President’s Council in 1985:

“Competitiveness for a nation is the degree to which it can, under free and fair market conditions, produce goods and services that meet the test of international markets while simultaneouly maintaining and expanding the real incomes of its citizens. ”

As per the Wrold Economic Forum, the competitiveness is defined as “the set of institutions, policies and factors that determine the level of productivity of a country”. Similarily, corporate competitiveness can be defined. When the company’s productivity increases, its revenues will increase. And the level of productivity of a company is well compared to that of others, measured and shared among companies. As competitiveness can promote the level of standard of living of citizens of a country from the perspective of the national competitiveness, the company’s competitiveness links to the generation of revenues and growth of business. In short, competitiveness will lead to the well-being of of a country and a company. As a result, productivity leads to competitiveness, which subsequently leads to the growth.

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