156 Part 2: Strategic Actions: Strategy Formulation
competitors larger than it is will be different from the competitive actions it will encoun-
ter from smaller competitors.
The organizational size factor adds another layer of complexity. When engaging in
competitive rivalry, firms prefer to be able to have the capabilities required to take a large
number of unique competitive actions. For this to be the case, a firm needs to have the
amount of slack resources that a large, successful company typically holds if it is to be
able to launch a greater number of competitive actions. Simultaneously though, the firm
needs to be flexible when considering competitive actions and responses it might take if
it is to be able to launch a greater variety of competitive actions. Collectively then, firms
are best served competitively when their size permits them to take an appropriate number
of unique or diverse competitive actions and responses.5-5c Quality
Quality has many definitions, including well-established ones relating it to the production
of goods or services with zero defects and as a cycle of continuous improvement.^69 From a
strategic perspective, we consider quality to be the outcome of how a firm competes through
its value chain activities and support functions (see Chapter 3). Thus, quality exists when
the firm’s goods or services meet or exceed customers’ expectations. Some evidence sug-
gests that quality may be the most critical component in satisfying the firm’s customers.^70
In the eyes of customers, quality is about doing the right things relative to performance
measures that are important to them.^71 Customers may be interested in measuring the
quality of a firm’s goods and services against a broad range of dimensions. Sample quality
dimensions in which customers commonly express an interest are shown in Table 5.1.Quality exists when the
firm’s goods or services
meet or exceed customers’
expectations.
Table 5.1 Quality Dimensions of Products and ServicesProduct Quality Dimensions- Performance—Operating characteristics
- Features—Important special characteristics
- Flexibility—Meeting operating specifications over some period of time
- Durability—Amount of use before performance deteriorates
- Conformance—Match with pre-established standards
- Serviceability—Ease and speed of repair
- Aesthetics—How a product looks and feels
- Perceived quality—Subjective assessment of characteristics (product image)
Service Quality Dimensions- Timeliness—Performed in the promised period of time
- Courtesy—Performed cheerfully
- Consistency—Giving all customers similar experiences each time
- Convenience—Accessibility to customers
- Completeness—Fully serviced, as required
- Accuracy—Performed correctly each time
Source: Adapted from J. Evans, 2008, Managing for Quality and Performance, 7th Ed., Mason, OH: Thomson Publishing.