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Elements Of Global Rivalry

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The answers to survival in modern day global rivalry lies in the four elements, which independently and as a whole come together to form the diamond of national advantage. These components are factor conditions, demand conditions, related and supporting industries and lastly the firm’s strategy, structure and rivalry. At first, according to the diamond theory, the factor conditions consists of production factors such as labor, land, natural resources, and infrastructure which determines the flow of trade among nations. For instance, the Kingdom of Saudi Arabia is very well recognized for oil and oil reproduction, consequently it utilizes the oil as a main export to other nations in exchange for goods and services. With today’s rapid technology production factors consisting of labor pool, natural resources and so forth are not enough for nations to compete on a global scale thus it needs to be upgraded and specialized. Specifically that the global trade that has created an accessibility for the nations to access the local resources and technology. …show more content…

The demand for products and services derives the nation to produce and innovate. Therefore, the more sophisticated the buyers are the more competitive advantage is gained. This demand level fluctuates across different segments for the nation or even for other nations through dedicating ahead of time those indicators of the consumer necessities. This advantage can also be gained not only by the nation it self but also for other nation. One of the most common case in point given, is the research done for chronic diseases and to developed treatments, such as diabetes, hypertension and many other chronic illness. Moreover, it is vital to comprehend the demand behavior one country is not similar to another …show more content…

Highlighting the fact that the four elements work interchangeably and impact one another. For this reason, the diamond system establishes four forces that are complementing one another, where two of these elements are self-reinforcing, they are the domestic competitiveness and geographical focus. The outcome of these forces helps one another to elevate, the competitiveness leads the companies to innovate, and the geographical location amplifies the elements separately and all collectively. The direction of the relationship can be horizontal or vertical, for instance the top class suppliers can become new threat entrants in the market, and an excellent example for the diamond system is the how the Japanese were able to enter the electronic market for liquid–crystal display due to the reason they formally supplied the US market for electronic components assembly, started its electronic company DELL. The company is competing for the leading brands for the PC laptop and netbooks. From the discussion of the diamond features and demonstrating them in a live case studies, it can be agreed that the diamond system forms an environmental cluster of competitive industries. Once a cluster forms the whole group of industries become mutually supporting. Thus the companies must analyze

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