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4. Hypothesis Development
When faced with a hypercompetitive environment, companies are forced to make a series of moves to stay competitive and keep their advantage amongst their competitors. They will either excel at one or all of the four dimensions that follow to be deemed as successfully maintaining an advantage within their hypercompetitive environment.
4.1 Focus on Developing New Advantages
This sort of action refers to when a company makes a decision to drop or turn focus away from their traditional ways of sustaining an advantage and focuses on developing new advantages.
(Johnson, Gerry, et al., 2014) This dimension is in line with positioning for speed, stakeholder satisfaction, and soothsaying. Travel agencies must constantly find new ways to satisfy the customers and new ways to gain new customers in order to stay sustainable within the competitive environment. With the fast pace of changes in the market due to rapid development of technology, they may need to drop traditional ways of conducting business and adapt new ways to maintain advantage. Success in this dimension will be determined by the company’s actions that pertain to the following questions:
Does the company constantly search for new ways to promote their product?
Does the company create new services in response to customer demand?
Does the company look for new opportunities with new suppliers?
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Has the company undergone any procedural changes internally that involves training employees to improve quality of service?
Did the company ever need to cannibalize any traditional ways of conducting business because it was not creating enough returns?
Does the company try to differentiate themselves through increasing consumer perception of value rather than use pricing strategies?
4.2 Make Series of Small Moves Rather Than Big Moves
As companies in a hypercompetitive environment will need to make changes and moves often to keep ahead of their competition, they will need to create smaller changes for temporary advantages as opposed to big moves that cannot be sustained very long with hypercompetitive opponents looking to disrupt the playing field constantly. Another benefit of small moves in a hypercompetitive environment is that small moves tend to go undetected by competitors therefore harder to counter (Johnson, Gerry, et al., 2014). This dimension is in line with simultaneous or sequential strategic thrusts and position for speed and surprise from D’Aveni’s framework.
Travel agencies will most likely create small changes within their package tours which may go undetected by competitors and still attract new consumers. Small moves can also be done within the organization for travel agencies to try to differentiate themselves through quality of service.
Success in this dimension will be determined by the company’s actions that pertain to the following questions:
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Has the company undergone any internal changes to boost quality of service
Does the company make changes to their product or services within a short time span (3 months being a benchmark)?
Does the company try to make moves to assume different segments of the market simultaneously?
Has the company redefined their target audience before?
Has the company redefined their products to target new audiences before?
Does the company invest in multiple new projects to be prepared for what future market demands are?
4.3 Avoid Imitation by Being Unpredictable
In a hypercompetitive environment, competitors will seek to imitate companies who are successful in their promotions or processes. It would be easier for competitors to imitate a company if its action were predictable which happens a lot in the traditional setting of business (Johnson, Gerry, et al., 2014). This dimension is in line with the positioning for surprise and shifting the rules of the game approaches from D’Aveni’s framework. Travel agencies today have a harder time not being transparent to competitors with a lot of promotions and distribution channels conducted on the World Wide Web. They must find ways to be unpredictable and keep their competitors guessing on their next move to keep their advantage in the market. Success in this dimension can be observed through how a company performs pertaining to the following questions:
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Are there any known entry barriers that have been set up by the company to block out competitors?
Are there any ways the company is fronting an appearance of unpredictability?
Does the company consciously create surprise actions to throw off their competitors?
Has the company done anything seemingly irrational that competitors have a hard time imitating?
Does the company keep track of what their competitors are doing so they can strategize on how to out maneuver them?
Does the company create alliances with other companies in different market sectors to gain new market sectors and avoid imitation?
4.4 Mislead the Competition
This is defined by any action that the company would take to communicate to competitors to take a different directions as they would. This dimension would be needed to survive in a hypercompetitive environment to again throw off and confuse competition so the company has time to seek new opportunities to gain advantages. A company may pretend to be successful in a market sector while they prepare themselves to respond to an attack from a competitor elsewhere (Johnson, Gerry, et al., 2014). This dimension correlates with the signaling, positioning for surprise and shifting the rules of the game approaches from D’Aveni’s framework. Travel agencies will need to find ways to mislead their competition to gain entry to new markets or gain
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new advantages as first movers. Performance in this dimension can be determined through observing the actions of the company pertaining to the following questions:
Does the company keep track of what competitors are doing in the market place and observing how competitors respond to their actions?
Does the company signal moves to throw off competitors but go in a different direction?
Does the company signal any big changes to competitors to either intimidate or confuse competitors?
Has the company disguised initial successes to help buy time to prepare themselves to respond to the market?
4.5 Other Critical Success Factors
Other critical success factors that will be considered to help determine how successful a travel agency is in terms of surviving and keeping their advantage within the hypercompetitive environment of the travel industry. Through research, it was also found that technology plays a very important role in shaping today’s travel industry. Therefore, one of the more important critical success factors that will be closely observed that may contribute to the company’s success in today’s hypercompetitive environment is how quickly and how well the company adapts to creating a strong online presence. They should perform well in one or more of the following:
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Flexibility in sourcing new travel products or packages
Minimizing the costs of development and maintenance of the website
Access to expertise in web strategy, development and implementation
Capitalizing on a high profile offline image
Accessing new customers
The potential for channel conflict
These characteristics, proposed by Carlopio should also be considered as another factor in the analysis of determining success of the companies’ survival in hypercompetition (Carlopio, James, et al., 2012).
In order for a company in the travel industry to stay competitive they must exhibit strong performances in at least more than one of these four dimensions to be able to stay ahead of their competitors in the industry and be able to survive without being overpowered by other competitors. Their strong performances in these dimension can show how they are able to sustain a continuous cycle of disruption and rebuilding advantages which are key to endure in a hypercompetitive environment. The overall performance in the four dimensions can be compared against the companies’ performances in adapting to their online presence to create a clearer view of where each company is positioned.