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Part 1

Organisations producing digital maps are the chief suppliers of the PND industry. They give real-time information on the location of a car along with information on road traffic and conditions. Suppliers of a company are capable of stunting or completely restricting the growth of the company within the PND industry. Some of the suppliers of digital maps are Apple, Tele Atlas, Google, AutoNavi. These companies provide data for digital maps to the PND companies. These data help in strengthening the GPS tracking system in vehicles. One of the successful companies that created editable maps was OpenStreetMap (OSM), which created a non-collaborative project in the year 2004. Companies producing satellite images are also suppliers of the PND industry who help in directing navigation in GPS.

Some of the customers of the PND industry are e-commerce companies that facilitate the online purchase. Automobile manufacturing companies are also customers of the PND industry as cars nowadays are bestowed with efficient navigation systems.

Complementors are firms that are known to provide a strategy that is value-based in the context of innovation. Some of the complementors of the PND industry are organisations in the telecommunication industry, automobile industry and the electronics and engineering industries. Companies in the Research And Development Industry are also complementors of the PND industry since implementation of a Portable Network device requires proper research work so that the processes can be implemented efficiently.

Some of the key players in the PND industry are:

  • Alpine electronics
  • Gramin
  • Pioneer
  • TomTom
  • Samsung
  • Continental
  • Kenwood 

All organisations are competing to emerge as key players in their respective industries. The products of both Garmin and TomTom are closely similar that it is difficult to make a proper choice of the better between the two. The user interface of Garmin is highly unparalleled. It offers readability to users, which is clear and easy to comprehend. However, TomTom is constantly improving in terms of readability, but Garmin offers prominent and clear visibility to its users. While TomTom receives its GPS from a company known as Tele Atlas, which is a European company, Garmin obtains its maps from NavTeq, which is an American company.

Garmin has a large number of competitors in the market. Despite the presence of so many competitors, it is staying gallantly at the forefront among competitors. Market share and recognition of brand are very important to remain successful in the industry. The barriers of entry are mostly low in the PND market. There is a potential downside of every professional sector where barriers of entry are a major one. There is a significant risk that remains as a result of such low barriers. It is leading to an influx of companies in the industry that are offering eminent and efficient services in the industry. There is probably no such threat of substitutes since most companies in the PND industry use the same technology like GPS, and there basically is no real substitute. In a competitive and rising industry such as the PND, where all companies require semiconductors and LCD display screens, the suppliers have their own power. The power of the buyers in the industry is also very alarming. The price of the PND products is falling rapidly since it is difficult to sustain a high range of prices for products that more or less serve the same function. Hence, it becomes difficult for companies to compete in terms of the price charged to buyers. Garmin, however, holds a very strong position in the market, charging the high price of products as there is a distinct advantage in other markets of the companies like aviation, fitness, marine electronics and associated markets due to the various advancements in the market that are taking place.

Part 2

The first response to the threat of smartphones on the part of Garmin was the introduction or launch of its own proprietary smartphone named Nuvifone. This was a navigator-centric smartphone which was a blend of the phone with access to the internet and the capability of GPS. It was aiming at a market that was different from that of Apple. The smartphone had better technology of navigation that could give voice directions while handling navigation and calls simultaneously. This was an innovation that was mastered by Gramin much before other smartphone companies could do so. The commercial viability of this smartphone was questioned as compared to its competitive counterparts in the market. After the release of the product, its success was not accomplished, which made Garmin switch to businesses from other companies, thus launching products with high-end technology for sailors and sportsmen. The company tried to make profits from the automotive industry along with the fitness and the sports industry. Garmin successfully expanded in the fitness and aviation industry. The revenue of the company returned to normal, and a net profit of 823 million dollars was made, which made the company one of the top-performing stocks in the sector of technology.

TomTom pursued a business strategy with HD maps along with self-driving cars, and this made them lock in a battle with some of the major players of automobile manufacturing as well as Google. The rebuilding of iPhone maps of its own was made by Apple with the usage of data from TomTom. This caused the falling of stock prices, having a fear that it would lose some of its major customers in the business of maps. In 2018, TomTom sold its telematics business to lay emphasis on a head-to-head competition with Google in creating a software of car navigation.

Both the companies were facing terrible competition due to the advent of smartphones and the increasing popularity of the same in recent years. This made the companies switch to other strategies of business that were unique and could acquire a new set or base of customers utilizing its existing popularity.  

Competitive advantage is an aspect that helps a firm earn higher revenue and, in turn, profit. The focus of Garmin is mostly to work on innovation with the aim of creating a business that is increasingly dominant in the industry. The company holds the potential to capitalize on growth in the segment of wearable by holding a position as a niche operator. This is far better than competing with the competitors in the segment of the general smartwatch. There has been the implementation of several new features in its products which is the potential of boosting the performance of the employees in the aviation industry as well. If the company can crack a deal with Disney, then it would serve as a drastic competitive advantage with a demographic group of young people who will be customers buying a smartwatch. In the sector of aviation, a business can be boosted with the acquisition of Flight Plan that has been launched recently. With Disney, Garmin is planning to produce a Princess-themed band that could give incentives to customers for purchasing the products of the company. The lucrative features of the product could turn it to be a product with extended longevity. Garmin’s competitive advantage can be gained by launching cycling safety markets by implementing next-generation Varia radars. The global market of wearable products has possibly grown to a huge extent over the past 4 years that turn out to be of great competitive advantage. 

In 2020, Garmin fell victim to a severe ransomware attack where the internal system of the company got completely encrypted, and the customers were unable to access the services of the company online for quite a number of days. The ransom demanded the revival was 10 million dollars. However, Garmin restored its services within a month and sent a press release for the same. Hence, it can be understood that the company may be exposed to cyber security threats in the future. Technology risks along with data breaches are other possible threats that a company dealing in digital technology and development may face[7]. In case of a data breach threat, some confidential or protected data of the company may be accessed by any other entity in a very unprofessional manner.

The advent of some more innovative features and development such as developing an alternative navigation system of the satellite on a global basis, burgeoning penetration in the market of smartphones and shuffling of the market of digital data may push back Garmin in the line of competition. Thus, they need to be immensely aware of the moves taken by their competitors along with constantly developing with innovation to stay ahead in the global competition and probably avoid the threats in the future.

Though TomTom is a company that deals mostly in satellite navigation, the company creates a veritable arsenal of maps that are of high definition as it is fighting in the battle to boost up power in the autonomous cars to be driven in the future. The company is indulging in partnerships to accomplish this, which is making it gain a lot of competitive advantage these days in the market[8]. TomTom is gaining some key competitive advantages over Google, which is its arch-nemesis. These cars will be bestowed with the richness of real-time traffic sources of data that can be accessed by TomTom. There is also a competitive advantage of TomTom over Google in terms of licensing as well.

Some of the issues or threats that TomTom might face in the future are competitive pressure. New brands can enter the market with high-end digital navigation services, which may pose direct competition to TomTom. Incorrect mapping of satellites can disrupt the business of TomTom to a great extent. At the same time, high-risk findings in the unit of telematics business can also be a threat to the proper execution of business of TomTom.

Reference List

  1. Hoffman, Alan N. "NEW COMPETITION EVERYWHERE!." Strategic Management and Business Policy(2015).
  2. Adner, Ron, and Marvin Lieberman. "Disruption through complements." Strategy Science6, no. 1 (2021): 91-109.
  3. Adner, Ron. Winning the Right Game: How to Disrupt, Defend, and Deliver in a Changing World. MIT Press, 2021.
  4. James, Eric. "The professional humanitarian and the downsides of professionalisation." Disasters40, no. 2 (2016): 185-206.
  5. Kim, Heechun, and Robert E. Hoskisson. "A resource environment view of competitive advantage." In emerging economies and multinational enterprises. Emerald Group Publishing Limited, 2015.
  6. Stephens, Robert. 2022. "Garmin's Innovative Approach C - Gurufocus.Com". Com. https://www.gurufocus.com/news/750421/garmins-innovative-approach-could-deliver-high-returns.
  7. Kamhoua, Charles, Andrew Martin, Deepak K. Tosh, Kevin A. Kwiat, Chad Heitzenrater, and Shamik Sengupta. "Cyber-threats information sharing in cloud computing: A game theoretic approach." In 2015 IEEE 2nd International Conference on Cyber Security and Cloud Computing, pp. 382-389. IEEE, 2015.
  8. Fréry, Frédéric, Xavier Lecocq, and Vanessa Warnier. "Competing with ordinary resources." MIT Sloan management review56, no. 3 (2015): 69. 
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My Assignment Help (2022) Suppliers, Customers, Complementors, And Competitive Advantage In The PND Industry [Online]. Available from: https://myassignmenthelp.com/free-samples/ecnm10032-economics-of-strategic-behaviour-1/research-and-development-industry-file-A1DCE51.html
[Accessed 01 March 2024].

My Assignment Help. 'Suppliers, Customers, Complementors, And Competitive Advantage In The PND Industry' (My Assignment Help, 2022) <https://myassignmenthelp.com/free-samples/ecnm10032-economics-of-strategic-behaviour-1/research-and-development-industry-file-A1DCE51.html> accessed 01 March 2024.

My Assignment Help. Suppliers, Customers, Complementors, And Competitive Advantage In The PND Industry [Internet]. My Assignment Help. 2022 [cited 01 March 2024]. Available from: https://myassignmenthelp.com/free-samples/ecnm10032-economics-of-strategic-behaviour-1/research-and-development-industry-file-A1DCE51.html.

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