Thus, some consumers will choose the goods of the com- pany using policy № 6, i.e. the products of the company offer­ing high-quality goods at average prices.

All the strategies of the patient firm have something in common — all of them are intended to reach the highest quali- ty of the product. Like in the case of violent firms, this inten- tion can be justified (policies №№ 3, 6) or can have nothing to do with the true advantages of the product (policy № 2).

soderzhanie. — M. : Ekonomika, 2007. — 420 p.

mezhdunarodnyih ryin-kah. — M. : Mezhdunar. otnosh.,

erating within the strategy of patient firms have to deal with?

penetration"?

used?

12. What are the key characteristics of the enterprise’s functional status at the operational level of competitiveness management.

In market economy, some companies are engaged into research and development (R&D) activities, while others ob­tain the most significant results. Two-thirds of all industrial research work activities are carried out by major companies employing over five thousand people. Nevertheless, significant innovations are not the output of the leaders’ efforts, but the outcome of small, previously unknown firms’ activity.

The first attempts to explain this phenomenon at the firm’s level were made by the famous Austrian and American economist Joseph Alois Schumpeter in the beginning of the 20 century. In his book "The Theory of Economic Development" (1911), he differentiated two parts of economic life: routine cycle and developmental (or innovative) activity.

Thus, it is not the conservatism that resists innovations, but rather the expected effect of market forces.

Chief executives of violent firms prioritize the routine ac­tivity as the expensive equipment for mass replication of prod­ucts cannot be designed for problematic projects.

In a patient company, innovative activities are limited by the focused specialization — any (even advanced) ideas are ignored if they go beyond the chosen market niche.

For commutants, any innovation projects are inappropriate.

Of course, it would be good for any company to know possible results of the radical innovation (introduction of an essentially new product, long-term benefits in comparison with the competitors).

However, explerent firms are more intensively motivated than other firms.

It should be noted, however, that the innovation business is not pursuing scientific and engineering goals. Both of them are undoubtedly important, but every single action of the firm

is aimed at achieving the main goal — the introduction of a competitive product.

First, each new investment is possible only if the previ- ous one has been paid off.

Secondly, each new investment is more intensive than the previous one and is carried out on more favourable terms than the earlier on e. Thus, for example, the venture company re- quires about a quarter of all the stocks and shares of the explor­ing firm for the original investment of half a million dollars, whereas only 12,5 % of all the shares are required for the final investment of 16,5 million dollars. It means that each dollar received by the exploring company at the final stage of the pro- ject costs 66 times as cheap as each invested dollar at the be- ginning of the project.

Thus, an explerent firm gets the necessary funds, while the risks of the venture company are not really high, as its loss­es can be compensated for the returns from other projects.

The second stage is the stage of market success.

After settling down the financial problem, an exploring firm can complete the development of the competitive product. For most companies, the pre-market stage of evolution culmi- nates in bankruptcy. Those who succeed, enter the second stage of the development — a period of rapid growth connected with the introduction of a new product to the market.

At this moment, an explerent firm can replace pioneer firms in the market. Explerent firms that don’t have any expe- rience in competing with other companies have to struggle with more powerful rivals that have advantages in the organization of mass production.

Only a few explerent firms can conquer violent firms with their own efforts; and even those who cope with the first

stage of the competition stay very vulnerable for a long time as after losing the leading position, they transform into minor producers of average products, i.e. they acquire the position of the vice-leader in the market.

The consumption value of a new product.

In the modern world, to understand our own needs has become an important research objective. An average consumer is used to having a one-track mind, i.e. what the customer wants from the new goods and services is the very same quali­ties that were typical of the previous products, but at the same time they should be "upgraded". The producer is to see these "personal wants" during the customer survey and challenge the designers. As a result, as the research suggests, 90 % of the so­called "new" products brought to the market differ from the "old" ones only in petty improvements. Consequently, little attention is paid to the production of essentially new products that could considerably improve the competitive position of the companies.