Competitive Strategy within Product-Concept to Deliver Maximum Product Value

Posted in Operations & IT Articles, Total Reads: 1606 , Published on 07 September 2014

Conventional wisdom implies that articulated priorities of vendor and customer are generally oppositely directed, though the final outcome of the offered Product Value shall not only correspond to the business needs of the manufacturer/developer, but also meet the most contentious demands and requirements of the final consumer. However, the process of value creation and target features identification shall go along with the imposed characteristics of external environment which greatly determines the pressure to which all the vendors within specific region/business environment are exposed to. That covers scope and strength of the competition at the chosen market segment, legal implications, overall level of technological development and standardization of the specific field of operation, access to resources, customers’ profiling features, etc. For this very reason when scrutinizing the scheme of value creation and its composite parts, it is of primarily importance to expand the scope of analysis to externally affecting factors – and thus to sketch the detailed canvas of strategic development plan.

Image Courtesy:, pakorn

With rocketing evolution of the IT-market, accompanied by simultaneously arising stealthy and most fastidious cyber-attacks, all functional capacities of once cutting-edge-technologies fail to cope with changed operating environment, which requires emergence of broad-ranging appliances to fit new-generation demands. And here we may turn to NGFWs. This paper primarily focuses on analysis of the innovative IT – infrastructure composing product, namely next generation firewalls (NGFW). These appliances are aimed at tackling the most severe and sophisticated cyber-attacks and IT-security threats. According to the Gartner Glossary, NGFWs are deep-packet inspection firewalls that move beyond port/protocol inspection and blocking to add application-level inspection, intrusion prevention, and bringing intelligence from outside the firewall [1]. Transition to these appliances, as well as their inter-relation and composition with UTM-appliances is a reasonable response to the emerging demands and pressures of contemporary business-environment (figure 1).

Figure 1. Major drivers of transition to NGFWs

Analysis of the Info - Tech research group [2] has determined the “Champions” within the segment of NXFWs: Dell (SonicWall), Fortinet, WatchGUard and Sophos. In order to shape the pattern of leadership features and adopted approaches, the comparative analysis of these vendors is required. This paper presents a brief, but precise and targeted analysis of the above-mentioned IT-manufacturers. All specified vendors have a few common features:

• Offered diversified range of functional capabilities ingrained within multiple platforms;

• Solid market presence/market-leader positions;

• High reputational characteristics within the mid- and large-sized business entities.

However, each vendor targets implementing unique/specific features to attract their target audience and to increase Product Value by means of extra offer-differentiation. By doing so, they also focus on oppressive external factors that define some strategic lines of their business-strategy development and entire course of business operation activities.

Anyway, the vast majority of the specific features of the adopted business strategies and value-creation are merely focused on delivering the product and value which corresponds to the imposed requirements and implied standard requisites - which will aggregately stand for the customer expectations, as well as basic (standard) features to be offered at particular regional market. Here we may move further to comparative analysis of the largest business cultures and largest (and, notably, quite oppositely-directed) IT-markets in the world- namely, the USA, Germany, China, and Russian Federation. The key point here is an estimation of the IT-network landscape and their sustainability and vulnerability to multiple cyber-hazards, which pose considerable threat to the information security and thus business development, healthy competition at the markets and innovation-driven growth. This paper will briefly focus on this issue and its interconnectedness with offered products at NGFWs market.

Table 1

Comparative analysis of the regional cyber-security market landscapes



Russian Federation


Political & Regulatory framework

requires further development and amendment of current legislative base

developed legislative base, conformance with international legal standards, orientation on american criteria of security

poor level of IT-security supportive legislation; necesssity to conform to regional and international legal base

highly develped legal infrastructure and legistative base

Business & Innovation

competitive environment, drive for exponential growth, rapid development of applied technologies

bampered but stable growth potential, threatened by regular economical fluctuations in the EU-zone

tendency of steady development and growth, but slowed down by geo-political wars and economical recessions

potential for further growth, IT-driven branches are still in process of development due to competitive environment

Available IT-infrastructure and level of digitalization

high level of technological process in urban and highly developed areas; poor infrastructure within other regions

high level of technological process that is supported by amended legislation on security standards

high level of technological process in urban and highly developed areas; poor infrastructure within other regions

high level of technological process; governmentally supported cyber-security initiatives

Affordability and acquisition readiness

necessity to gain extra investments (internal and external) to facilitate further transition to digitalization

high level of transition readiness; still in process among SME

necessity to gain extra investments  to facilitate further transition to digitalization

high level of digitalization, tendency to opt for solutions with extensive scalability options

Business usage

broad appliaction of specialized IT-products; focus on manual power and reluctancy to invest extensively in IT

broad appliaction of specialized IT-products; focus on highest level of guaranteed security and functional capacities

poor level of transition due to expensiveness of technologies; focus on offered combination of price & quality

broad appliaction of specialized IT-products; focus on highest level of guaranteed security and functional capacities


high level


high level


Willingness of SME to turn to IT-securitization

mostly driven by necessity

high level of IT-security awereness

stimulated by financial concerns

high level of IT-security awereness

Dominant  product-value focus-criteria

quality & price

quality, brand name, range of functional capacities

quality & price

quality, brand, speed of operation, functionality

Paving their way to decisive progress in terms of market development and rebalancement of the leveraged key-points within product-value choices, such countries as Germany and China are progresing rapidly with extensive usage of the cyber-security appliances (both, traditional[and cloud-based). Overall IT-landscape and integration readiness indicate that countries with similar pattern of marketdevelopment and customer-oriented value-generation process are to copy the trend of development and to be characterized as prospective and strategic customers within the NGFWs segment.

As foir the RF (which is quiteremarkable sample of post-soviet economy with target-oriented development and relative steadyness of growth): on the one hand, vast geographical market-expansion is to hinder overall capasity to quickly and more economically develop IT infrastructure as a whole, and thus to attract investments in cyber-security lanscapes, that will result in large-scale shares sales, presence of multiple vendors and robust IT-security market growth. But existing weaknesses in innovation & technology systems persist to substantially mitigate these market-driving advantages. Anyway, for abovementioned states the product-value creation is all about budget-friendly solutions with remarkable quality and extansiverange of ingrained services. Customer-perspective postiion shall be deemed as determinating due to price-sensitivy (apart for Germany, where brand-status occupies dominating position). Here we can also mention the influence of the disclosure law governing security practices, rising number of security-breaches and data loss incidents will result in ever-increasing usage of products that can create and enforce security policy. This basically means that external factors determine greater usage of the latest IT-advancements.

The USA - homeland for manufacturersand vendors of the cyber-security appliances and IT-technologies is characterized by robust proliferation of transition to cloud-based cyber-security solutions and to NGFWs. The level of price-sensitivity remains quite low, and the focus is on customization of offered solutions and on brand-implied value.

This article has been authored by Olga Krytsyna from Intercomputer Systems, LLC


1. Gartner. IT Glossary. [Electronic resource] // Mode of access:

2. Info-Tech Research Group. Vendor Landscape: Next Generation Firewall. [Electronic resource] // Mode of access:

3. The global information technology report 2014. [Electronic resource] // Mode of access:


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