Sustainable Competitive Advantage In Ghana

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The Financial Sector Adjustment Program (FINSAP) in response to requests for easier access to credit for companies hit by the policies of the Economic Recovery Program. The company was a joint venture between the Bank of Ghana and the Social Security and National Insurance Trust. Despite offering some of the highest lending rates in West Africa, Ghana’s banks enjoyed increased business in the early 1990s because of high deposit rates. The Bank of Ghana raised its rediscount rate in stages to around 35 percent by mid-1991, driving money market and commercial bank interest rates well above the rate of inflation, thus making real interest rates substantially positive. As inflation decelerated over the year, the rediscount rate was lowered in stages…show more content…
A company is not in business to achieve a sustainable competitive advantage over its competitors but to create wealth for its shareholders. Actions which contribute to sustainable competitive advantage but detract from creating shareholder wealth can be a good strategy in the competitive sense, but bad strategy for the company. It is also worth noting that certain sources of competitive advantage may be more enduring than…show more content…
The bases of differentiation, however, cannot be overlooked, if a product suffers a negative perception in terms of quality comparable to those of competitors, a cost leader may be forced to discount prices well below competing products to gain sales, nullifying the benefits of its favorable cost position (Peattie and Peattie, 1994). Proximity, as it applies to differentiation means that the price discount required to obtain an acceptable market share does not offset a cost leader’s cost advantage, and therefore the cost leader will earn above-average returns. According to Porter (1998), the strategic logic of the cost leadership usually requires that a firm be the cost leader, and not one of several firms jostling for that position. The strategy is largely dependent on preemption, unless major technological change allows a firm to radically change its cost position. The theme that runs through the entire strategy is low cost compared to competitors, although it cannot be achieved to the detriment of quality and high service standards. Cost leadership requires an aggressive construction of efficient-scale facilities, vigorous pursuit of cost reductions from experience, tight cost and control, avoidance of marginal customer accounts, and cost minimization in areas such as research

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