Competition analysis and competitor analysis are the two different things which is extensively carried by an organization. Value creation and capturing are the two critical aspect of the competition cycle and cost management. Competition is being termed as a healthy prospect for the business and industry cycle but I find that pre 2008 competition was destroying values rather than creation. Post crisis has blessed us with value creation proposition particularly for the emerging and Asian economies. Value capturing is often being done by the big giant of the market where extensive merger and acquisition happens. We are taught in management school that merger and acquisition creates economies of scale but at the same time it creates value destruction.

A merger creates less value to be shared within the industry and creates monopolistic markets. One of the prime reasons for value destruction is the price of selling of products and services. Selling price creates values and also captures values. But, selling price would only able to create healthy value only when the cost bench-marking is efficient. Since if cost bench-marking is not effective then selling price competition could not sustain as a competitive advantage for an organization. Competitors would easily replace the product or service once the cost bench-marking is ineffective. If products are sold on the basis of quality then it would be quite difficult for the competitors to replace the same. Customer loyalty is another factor which helps to retain a competitive advantage for an organization but in emerging economies it is being found that customer loyalty moves simultaneously with the price sensitivity. Hence cost bench-marking is an prime aspect which needs to be kept in mind while designing the competitive advantage.

I find this is the place where efficient cost bench-marking is required so that an industry finds optimum level of value creation. Enhanced value creation would lead to increase of more players and healthy completion which would finally leads to creation of economic benefits for an organsaition. We must understand that competition is with customer alternative suppliers and not with the price. Once we realize this we will find innovation and new value creation activities in terms of products and services taking birth. Identification of future competitor is a key point to be kept in mind while designing the road map for the competitive advantage. Technological advancements needs to be considered while designing the pricing of products in emerging economies. It has been found that there is an extensive wide gap behind the measurement of future competition analysis. Big data analysis serves a key role to help out to develop the solution for the future competition analysis. In my previous articles I have depicted very clearly about how big data analysis would help companies to grow and develop the innovation culture within their existing culture. Understanding where competition are better and are worse and how the same would change in the near term are key focus areas of big data analysis. Big data analysis is not restricted to consumer data or behavior study but also with cost management.

Creating a efficient cost bench-marking with futuristic vision is an key aspect for creating an sustainable competitive advantage. The result of failure to do the above things is that extensive merger and acquisition happens which results to a significant monopolistic market control which further leads to stagnation on the industry growth and economy. Often it is being understood that low selling price is the key factor behind corporate success well efficient low cost model is the key. Sustainable competitive advantage is created based on low cost models since that gives a company a efficient pricing power. Hence efficient costing helps to create value and innovation which finally adds momentum to the economic growth. Cost Management helps to capture value and create value simultaneously.