Maintenance of Competitiveness of Productionjavascript

In his paper "Competitiveness: the economy, strategy, management" Michael Porter to determine the competitiveness of all levels of external factors as the competitive advantages of the goods. According to him, with the increase of competitiveness at the national level, industry, region, organization, manufactured goods, are improving all the integral and partial indicators of the competitiveness of the goods.

All levels of competitiveness are two-way communication (Figure 1.1). That is, the competitiveness of objects of each lower level is a factor in the competitiveness of all the objects of higher levels. In turn, the objects of higher levels to create conditions for competitiveness of objects at lower levels.

But not always increase the competitiveness of the objects of one level contributes to the competitiveness of other objects. For example, production of competitive products can be resource intensive and high cost that market conditions will inevitably lead to lower efficiency, reduced profits, deterioration of the financial situation of the company. This requires additional funding, resulting in reduced competitiveness of the manufacturer.

Synthetic indicator that combines competitiveness of the goods, producers, industry competitiveness and describes the situation on the world market, is a measure of countries' competitiveness.

In its most general form of country competitiveness can be defined as the ability of the country in conditions of free competition to produce goods and services that meet the demands of the global market, implementation of which increases the wealth of the country and its individual citizens [8, p.107]. His notion of competitiveness introduced in his theory of Michael Porter. That's national competitiveness, from his point of view, determines the success or failure in specific industries and the place that the country ranks in the world economy. National competitiveness depends on the ability of industry continue to develop and produce innovation. Initially, the national companies seeking competitive advantage by changing the basis on which they compete. Keep them the same advantage allows continuous improvement of product, method of production and other factors, and so quickly that their competitors are not able to catch up and overtake. Competition - it's not balance, and constant change. Improve and update the industry - an ongoing process. Therefore, in the explanation of competitive advantage is the country's role in promoting the home country's innovation and improvement. Thus, it appears that the process of creating and maintaining the competitiveness of extremely localized. The differences in the economies of countries in their culture, population, infrastructure, governance, national values ​​and even in history - all in varying degrees, affect the competitiveness of domestic firms. Porter shows that, despite the growing importance of globalization, national competitiveness is determined by a set of factors that depend on specific, local conditions.

Competitive advantage in international markets defines a set of determinants, "national diamond" as the author calls it. It includes four components:

1. Factor conditions, the specific factors that are needed for successful competition in the industry.

2. Demand conditions, that is what the domestic market demand for products or services offered by the industry.

3. Related and supporting industries, the presence or absence in the country related and supporting industries are competitive in the international market.

4. Firm strategy, structure and competition, that is what the country's conditions governing the creation of management companies, and the nature of competition in the domestic market. [6, p 98]

There are two additional variables, to a large extent influence the situation in the country:

• random events, then there are those that the firm's management can not control;

• Public Policy.

Extremely different approach to the competitiveness of the country is contained in P. Krugman. His position with regard to the country's competitiveness is based on the classical theory of David Ricardo (the theory of comparative advantage, first of all) and its recent extensions of neoclassical carried out under the traditional assumptions of the theoretical trend model of perfect competition

and general equilibrium. This concept reduces the competitiveness of the country's relative performance factors used, which is reflected in the trade balance, exchange rate, relative prices and, ultimately, affects the welfare of the country. All these results are evidence of the state of the national economy, and it is self-regulating, that does not require government intervention. Subject to state regulation in a developed economy and a fixed exchange rate may become the national currency, a devaluation which can align deficit, but at the same time it will lead to inflation and in the long run will result in a zero sum. Therefore, according to P. Krugman, the country's competitiveness, in contrast to the competitiveness of firms,

phenomenon that does not exist in reality, it is theoretically use the term "politically senseless and harmful".

Considering the competitiveness at the regional level, it should be noted that the modern concept of economic thought on different interpretations of the concept of regional competitiveness. Some scholars, such as offering to stop using the term in reference to the fact that the main objective of economic policy in the region - to provide its citizens a high level of life. The region's ability to do so depends not on some notion of "competitiveness" but on how productive uses national resources, as well as labor and capital. Probably so, but integrates these and other advantages of the region is the notion of competitiveness [19, p.11].

The most comprehensive definition of competitiveness of the region Parakhin VN, which consists of three fundamental aspects:

1. The need to achieve a high standard of living (competitiveness in the labor market competitiveness, provided by the public).

2. The effectiveness of the economic mechanism in the region (competitiveness in the market competitiveness of the goods or provided by manufacture).

3. Investment attractiveness (competitiveness in the capital market or the competitiveness of Finance).

Therefore, under the competitiveness of the region should be understood as its ability to provide high living standards and income of the owners of capital, as well as efficient use of existing regional economic potential in the production of goods and services [10, p.88].

As for the competitiveness of the company, then, again, no single definition of this term has not yet been worked out. One of the best definitions, where the competitiveness of the enterprise means an economic category, which characterizes the company's ability to produce competitive products with better than its competitors, the use of its potential [22, p.20]. It is especially important company's ability to promptly and adequately respond to changes in the behavior of buyers, their tastes and preferences. Entering the market with a competitive product - a starting point in the enterprise market development and securing it. This is followed by a large, laborious, and most importantly - a systematic work on the management of competitive products.

Competitive products and is the basis of all previously examined the levels of competitiveness, since it is the most important attribute of the economy and affects all producers.

Often equated competitiveness with quality products, forgetting that, firstly, in terms of quality matched only homogeneous goods, and secondly, in addition to the qualitative characteristics, the competitiveness of goods also includes consumer and price.

 

All of the factors determining the competitiveness can be divided into 5 groups:

• Quality of goods and services
• Price of goods and services
• Qualified staff
• The technological level of production
• The availability of funding sources
• The quality of the main characteristic of the goods.

Product can take a rightful place among the analogs only have a certain quality. The concept of quality include durability, reliability, accuracy, ease of operation, as well as the absence of the defects. However, not all of these qualities are necessary in each product, so strange to expect such as durability of disposable goods. Therefore, there is such an important indicator of quality as standards compliance. In addition, goods must meet the following needs of customers:

. Physical

. Technical

. Maintenance

. Aesthetic

Expensive (price and costs associated with running)

Realizing the importance of this factor in the competitiveness of the goods we will consider it in more detail in a separate chapter. Price of goods and services. Price is an economic category, which is the monetary expression of value of goods. It serves for the indirect measurement of the value spent on the production of goods necessary labor time. Historically, the prices set by buyers and sellers in negotiating with each other. Vendors are usually higher than the asking price, which had hoped to receive, and buyers - lower than that expected to pay. In the end, converge on a mutually acceptable price. [7, p 46]

Factors influencing the determination of prices of goods:

1. Aggregate cost of production;
2. The costs of public labor;
3. Quality of goods;
4. The functions and properties of the goods;
5. Qualifications of personnel;
6. Technology level of production;
7. The tax legislation of the country;
8. Costs associated with transportation and storage of goods;
9. Costs associated with rental of premises for implementation of Comrade
10. Packing;
11. well-known company;
12. The level of service and warranty;
13. The marketing activities of the company;
14. Supply and demand for these products;
15. mark-up firms.

When selecting pricing strategy must decide which goals will prosecuted for a particular product. The main objectives are:

1. ensure survival of the firm, such as in the case of intense competition
2. maximize current profits
3. gain leadership on indicators of market share
4. gain leadership on indicators of quality goods;

such as creating a certain image of the goods. Availability of skilled workers can constantly maintain a high quality product at a minimal cost for consumables. A huge number of products simply can not be made without qualified staff. Paramount importance and the availability of highly skilled management, as even in the presence of perfectly trained workers is hardly possible to create a competitive product without highly trained technologists, engineers, and difficult to organize its sales without the preliminary calculations of experienced marketers.

The technological level of production. The technological level, along with the level of staff can produce high quality with low cost and in shortest possible time. Thereby reducing the cost of production at constant quality. A workaround for constant technical re-equipment of production, the manufacture of larger quantities of goods is practically not possible in this case is very important accessibility of financing availability of funding sources. It is primarily used two types of financing this loan and private placement of securities (mainly production and quoting on the stock exchange of shares). Provide funding for the company through equity is the most realistic. There are several problems that impede adoption of decisions by management about the issue and placing of shares. First, the leaders of the enterprise, as a rule, may hold a significant share in the capital of the company and actually use the shareholder undivided property. In this case, the choice of mode of financing of enterprises through share placement often leads to conflict of interest management and potential investors.

Secondly, the reason for waiving this financing method may be a fear of Governors that in case of inadequate performance management enterprise of its functions, the new shareholder will require the displacement of existing managers with their posts. Thirdly, an insurmountable obstacle to a decision on placing of shares may be a requirement of the investor to ensure full transparency of financial reporting. This is due to the fact that business leaders hiding income from taxation can not, and sometimes do not want to demonstrate its investors. Thus, if the leaders of the company really want to attract capital, the real sources and ways of solving this problem exists today.

Certainly, the process of raising capital through a share placement requires considerable effort, time and money. It is necessary not only to develop all the financial documents in accordance with international requirements, but also ensure that the financial and legal audit. Therefore, the task of preparing enterprises to attract investment is one of the most important priority. Professionally prepared business has much more opportunities to attract the required capital. [8, p 11]

Ability of management to attract capital from extra-budgetary sources is one of the most important factors providing a competitive advantage in business. That is the problem of financing is also, primarily, the problem of quality management. Note that the company's capital structure consists of both debt and from its own funds. When the ratio of equity and debt significantly affects the level of income of private investors. Private investors, venture financing, assuming commercial risks. At the same time, the state may act as a guarantor to the bank to finance borrowing of capital, provided that the shares of the company will be made available to private investors or among certain investors.

Factors, Criteria and Indicators of  the Competitive products.

First of all, it is necessary to define the concept of "factor".

Since the concept of "factor" comes from the Latin «factor» - making, producing [17, p 474], this gives reason to formulate its definition as a specific driving force of the process that could change once or more indicators of quality.

Currently, there are many classifications of factors of competitiveness of production.

External factors:

1. The level of competitiveness of the country (with an increase in this index are improving all the integral and partial indicators of the competitiveness of goods);

2. The competitiveness of the industry (with an increase in this index are improving all the integral and partial indicators of the competitiveness of goods);

3. The level of competitiveness of the region (with an increase in this index are improving all the integral and partial indicators of the competitiveness of goods);

4. The level of competitiveness of the organization, produced the goods (with an increase in this index are improving all the integral and partial indicators of the competitiveness of goods);

5. The strength of competition in the output of the system among its competitors (both old and new) (increase in the strength (intensity) of competition increases the competitiveness of goods);

6. The strength of competition in the input of the system, including suppliers of raw materials, components and other components (increased strength (intensity) of competition increases the competitiveness of goods);

7. The strength of competition among the substitutes (increase in strength (intensity) of competition increases the competitiveness of goods);

8. The emergence of new needs (reduce the competitiveness of manufactured goods);

9. The level of organization of production, labor and management from intermediaries and consumers of goods produced by the system (raise the level of organization increases the competitiveness of goods);

10. Active contacts audiences (NGOs, consumer associations, media, etc.) [9, p 67]

Internal factors:

1. Patentability (novelty), construction (structure, composition) of goods (goods with increasing patentability increases its competitiveness);

2. Rationality of organizational structures and production systems (structure must meet the principles of streamlining structures and processes, then it will enhance the competitiveness of goods);

3. Competitiveness personnel system (improving the competitiveness of staff increases the competitiveness of goods);

4. Advanced information technologies (with an increase in the proportion of advanced technologies increase the competitiveness of goods);

5. Advanced technological processes and equipment (with an increase in the proportion of advanced technologies increase the competitiveness of goods);

6. The scientific level of control (management) (with increasing amounts of applied scientific approaches, principles and modern methods of increasing the competitiveness of goods);

7. The validity of the mission (the mission of the system must be designed to achieve competitive system and its products). [11, p 56]

It should be noted that in all of the above classification of factors of competitiveness of production can distinguish one thing in common, namely their division into external and internal.

There is also the view that the competitiveness of the commodity is directly dependent on diverse factors, including the paramount production costs, productivity and labor intensity, which affect the price and quality of products [3, p.66].

Production costs - this is expressed in monetary costs the company associated with the acquisition of factors of production and usage. Labor productivity - this is one of the key indicators that determine competitiveness in the global commodity market, because it is in the process of production laid the material basis of competition, which appear on the market through a comparative price levels and profitability.

Labor intensity is measured by the indices of the intensity of production (industrial and agricultural), which represent the generalized rate of average daily production volumes for each month of the reporting period relative to the reference month. Currently at the forefront of global competitiveness come out non-price

factors, of which the essential purchase quality goods, its novelty, research intensity and knowledge-based products. Therefore, most countries provide increased its commercial competitiveness through the use of innovation, developing high-tech products. In recent years, great importance in ensuring the competitiveness of the goods becomes an ecological factor. More stringent environmental standards, increasing demands for quality products and at the same time more intense competition on the world market forced the company to develop new products using the principles of pollution prevention in conjunction with self-monitoring. In connection with this important task is to improve the market mechanism so that environmental costs are included in production costs. Prices for goods and services must take into account the environmental factor of production, as well as use, recycling, waste management and recycling.

Consider the criteria for the competitiveness of products for the targeted and projected impact on competitiveness through them. [12, p 44]

Every product has a number of properties that determine its degree of fitness for a particular setting. To objectively assess the competitiveness of the goods, the manufacturer should the analysis using the same criteria that the consumer operates. Only in this case we can expect that assessment of the product to their business, coincides with that of the buyer. Therefore, you must first understand the totality of the criteria that are important from a customer perspective.

Among the criteria for defining the competitiveness of manufactured goods, produce: technical (appointments, regulations, ergonomic, aesthetic, and others), economic (cost of consumption) and organizational (discounts, payment terms and deliveries are complete, the terms and conditions of warranties, etc.)

In principle, this separation criteria can be used in assessing the competitiveness of any product regardless of the industry.

Among the criteria of competitiveness depends on the type and complexity of the product is technically and operationally, as well as the required accuracy of assessment, research objectives and other factors. For example, the economic criteria of industrial products provided at the cost of consumption, which consists of consumer spending for the purchase of (goods) and costs associated with the consumption, and the price of consumption is usually much higher sales price.

Therefore, the most competitive in the wrong product for which the requested minimum price in the market, but one that has a minimum price of consumption for the entire period of his service to the buyer. [13, p 122]

The correctness of the choice of criteria for evaluating the competitiveness of the goods depends on the accuracy of the evaluation itself. At the same criteria should be chosen on the basis of assumptions, our own experience and on the basis of a detailed study of consumer demand, conducting market research.

Besides the basic properties of the products that define its quality is very important analysis of the "environment of the product," which includes: after-sales service, delivery reliability, ease of purchase, brand image and price. To determine the competitiveness of products based on selected criteria, using different indicators.

In the works of many authors based on evaluation of the competitiveness of the goods is the calculation and analysis of the complex index. If the value of this parameter is less than unity, then this suggests that this product is not competitive in this market with the existing situation. The value of the complex index equal to one suggests that the products of this company is similar to the competitiveness of the selected basis of comparison. And the value of the complex index of greater than one suggests that the products of the analyzed company is absolutely competitive with the standard in this market.