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Article
Publication date: 7 September 2010

H. Kurt Christensen

In the author's experience, even veteran executives often make statements about competitive advantage that reflect either genuine misunderstanding or casual misuse of the

Abstract

Purpose

In the author's experience, even veteran executives often make statements about competitive advantage that reflect either genuine misunderstanding or casual misuse of the term. This paper aims to offer a clear explanation of what constitutes competitive advantage so as to facilitate identification, assessment and strategizing.

Design/methodology/approach

The paper proposes a definition of competitive advantage that differs from that proposed by many textbooks. It is based on the idea that competitive advantage can only be defined in terms of customer value.

Findings

A number of cases are examined in the light of the customer value approach to identifying competitive advantage.

Practical implications

Company executives learn to periodically engage in systematic information gathering regarding customer‐perceived competitive advantages.

Originality/value

Organizations that adopt this customer‐perceived approach to competitive advantage can make better assessments of where to expend their efforts and resources to outmaneuver their rivals and improve profitability.

Details

Strategy & Leadership, vol. 38 no. 5
Type: Research Article
ISSN: 1087-8572

Keywords

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Article
Publication date: 14 July 2021

Shubham Dixit, Shiwangi Singh, Sanjay Dhir and Swati Dhir

This study aims to identify the antecedents of strategic thinking and its relationship with competitive advantage. Further, this study analyses the mediating effect of…

Abstract

Purpose

This study aims to identify the antecedents of strategic thinking and its relationship with competitive advantage. Further, this study analyses the mediating effect of strategic thinking between its antecedents and competitive advantage.

Design/methodology/approach

A self-reported questionnaire with 51 questions was floated among 220 professionals from various industries in India. The response was analysed using the partial least squares-structural equation modelling methodology using SmartPLS software.

Findings

The direct effect of creativity, corporate culture and knowledge management are established with strategic thinking, as well as a competitive advantage. Also, the study finds a significant relationship between strategic thinking and competitive advantage. The study finds no mediation (direct effect) in the case of creativity, corporate culture and knowledge management. Further, no mediation (no relationship) is found in the case of vision.

Practical implications

Business must start adopting strategic thinking practices in their decision-making process to create a competitive advantage. Further, the influence of corporate culture, creativity and knowledge management on strategic thinking highlights their importance.

Originality/value

The study establishes the impact of antecedents of strategic thinking on competitive advantage. The study highlights the importance of other factors along with strategic thinking for achieving competitive advantage.

Details

Journal of Indian Business Research, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1755-4195

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Article
Publication date: 8 June 2021

Halit Keskin, Hayat Ayar Şentürk, Ekrem Tatoglu, Ismail Gölgeci, Ozan Kalaycioglu and Hatice Tuba Etlioglu

This study aims to determine the simultaneous effect of exporting firms' competitive strategies and capabilities on the achievement of competitive advantages and export…

Abstract

Purpose

This study aims to determine the simultaneous effect of exporting firms' competitive strategies and capabilities on the achievement of competitive advantages and export performance under the boundary conditions of competitive intensity. In so doing, the study combines the alternative theoretical lenses of the resource-based view (RBV) and the structure–conduct–performance (SCP) paradigm.

Design/methodology/approach

Primary data were obtained from 281 Turkish manufacturer–exporter firms operating in different sectors and located in several regions of the country. Structural equation modeling was utilized to test our conceptual framework, which combined the effects of RBV-based and SCP-based factors on competitive advantages and export performance under the moderating influence of competitive intensity.

Findings

This study reveals that unique firm capabilities, specifically informational, relational, and marketing capabilities, and competitive strategies, including differentiation and cost leadership, provide export firms with a competitive advantage and improve their export performance in foreign markets. Furthermore, competitive advantages partially mediate the effects of competitive strategies and unique firm capabilities on export performance. Finally, unexpectedly, and contrary to most of the existing literature, we find that competitive intensity negatively moderates the link between service advantages and export performance.

Originality/value

This research offers a comprehensive view of manufacturer–exporter firms' export performance by accounting for the overlooked simultaneous effect of firm capabilities and competitive strategies through the mediation of competitive advantages and under the boundary conditions of competitive intensity.

Details

International Marketing Review, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0265-1335

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Book part
Publication date: 24 June 2015

Heechun Kim and Robert E. Hoskisson

Our study proposes a resource environment view (REV) of competitive advantage by unpacking the environmental origins of a firm’s competitive advantage. The key tenet of…

Abstract

Our study proposes a resource environment view (REV) of competitive advantage by unpacking the environmental origins of a firm’s competitive advantage. The key tenet of the REV is that the heterogeneity and imperfect mobility of strategic factor markets and institutions across countries explain how firms based in different countries would likely both create and sustain a competitive advantage. In particular, our study introduces the notion of “the paradox of environmental embeddedness.” The paradox lies in the fact that the same environmental conditions – in terms of strategic factor markets and institutions – that enable firms to create a competitive advantage can paradoxically also create a situation in which it is more difficult for these firms to sustain an advantage. Another important aspect of our study is that, to enhance our understanding of how firms manage the paradox of environmental embeddedness, our study specifies the resource environmental conditions under which firms’ internal and external resource-oriented strategies – that is, the development of dynamic capabilities and interventions in the country resource environment – are more beneficial when managing the environmental paradox. Overall, our theorizing has important implications for strategic management theory and practice.

Details

Emerging Economies and Multinational Enterprises
Type: Book
ISBN: 978-1-78441-740-6

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Book part
Publication date: 19 July 2005

Helena Mäkinen

This paper proposes a holistic, resource-based strategy framework for design-oriented industries consisting mainly of small firms. It consists of three main concepts: (1…

Abstract

This paper proposes a holistic, resource-based strategy framework for design-oriented industries consisting mainly of small firms. It consists of three main concepts: (1) sources of competitive advantage, especially core competencies, (2) competitive advantage, and (3) competitive strategy. The idea behind the framework is that sources of competitive advantage form the competitive advantages of firms, and these together influence the choice of competitive strategies. The proposed framework was developed on the basis of interview results from the jewellery industry in Finland. A total of 44 small firms each employing less than 25 people were interviewed. Respondents felt that the two most important core competencies were in the area of manufacturing. They were the abilities to design and manufacture products of high technical quality and to offer a broad range of products and attractive models. For the jewellery industry, competitive advantage was largely achieved through various aspects of design. The competitive strategy type most employed was the differentiation-based strategy. The proposed framework should be of value in integrating some of the diverse research in this area and suggesting specific relationships that might be the focus of future empirical studies.

Details

Competence Perspectives on Resources, Stakeholders and Renewal
Type: Book
ISBN: 978-0-76231-170-5

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Article
Publication date: 30 March 2021

Ghaith M. Al-Abdallah and Majda I. Al-Salim

Green product innovation is a global industrial concern. This research examines the possible impact of green product innovation on firms' competitive advantage in…

Abstract

Purpose

Green product innovation is a global industrial concern. This research examines the possible impact of green product innovation on firms' competitive advantage in industrial enterprises operating in qualified industrial zones (QIZs).

Design/methodology/approach

This research follows a descriptive analytical methodology, testing two hypotheses formulated based on the reviewed literature among chemical industrial plants of the three Jordanian QIZs (Amman, Zarqa and Irbid) in Jordan. Following a preliminary scoping study of all 219 Jordanian chemical manufacturers, a quantitative five-point Likert scale questionnaire was administered to firms applying green product activities.

Findings

In total, 20 firms were found to be utilizing green product innovation, representing only 9.13% of the overall population. The hypothesis testing results indicated that green product innovation has a statistically significant positive impact on competitive advantage. The results also showed that the factor “firm resources” has a statistically significant positive moderation effect on the relationship between green product innovation and competitive advantage.

Research limitations/implications

The vast majority of Jordanian chemical manufacturers were not implementing green innovation or practices; further study is needed to identify barriers. Findings are limited to managers of chemical industrial plants in Jordan, excluding the demand side (e.g. plant customers who purchase final products), which leaves a different research angle to be explored.

Originality/value

This is a pioneering study of green product innovation implications for firm competitive advantage in manufacturing enterprises, especially in QIZs of Jordan (which offer tax exemptions to foreign and local investors and sell products to regional and international markets).

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Article
Publication date: 1 February 2021

Mohammad Khodabakhshi and Mehdi Ahmadi

The paper aims to present an approach to cost-benefit analysis with stochastic data. Determining the type and the values of alternative’s factors are probably the most…

Abstract

Purpose

The paper aims to present an approach to cost-benefit analysis with stochastic data. Determining the type and the values of alternative’s factors are probably the most important issue in this approach. Therefore, in the proposed approach, a competitive advantage model was built to measure the values of alternative’s factors. Then, a satisfactory cost-benefit analysis model with random data was proposed to evaluate the alternatives. The cost-benefit analysis of each alternative was carried out to obtain the real and satisfactory cost-benefit of the decision-maker.

Design/methodology/approach

This paper is orientationally expressed as a mathematical problem in which the optimization problem needs to analyze the approach. This paper is written based on uncertainty linear optimization. Optimization under uncertainty refers to this branch of optimization where there are uncertainties involved in the data or the model and is popularly known as stochastic optimization problems.

Findings

As was seen in the purpose part, in this paper, an approach is presented to cost-benefit analysis by the use of competitive advantage with stochastic data. In this regards, a stochastic optimization problem to assess competitive advantage is proposed. This optimization problem recognizes the values of alternative’s factors which is the most important step in cost-benefit analysis. An optimization problem is proposed to cost benefit analysis, as well.

Practical implications

To investigate different aspects of the proposed approach, a case study with random data of 21 economic projects was considered.

Originality/value

Cost–benefit analysis is a systematic approach to estimating the strengths and weaknesses of alternatives used to determine options which provide the best approach to achieving benefits while preserving savings. Cost–benefit analysis is related to cost-effectiveness analysis. Benefits and costs are expressed in monetary terms and are adjusted for the time value of money; all flows of benefits and costs over time are expressed on a common basis in terms of their net present value, regardless of whether they are incurred at different times. As seen the paper using competitive advantage tries to determine the values of alternative’s factor. As competitive advantage model analyze the advantages and disadvantages of alternatives, this paper by the use of this idea tries to determine the costs and benefits. Two stochastic optimization problems in the middle of this approach are proposed, which assess competitive advantage and cost–benefit analysis, respectively.

Details

Journal of Modelling in Management, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1746-5664

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Book part
Publication date: 22 June 2015

Kamila Borseková, Anna Vaňová and Katarína Petríková

The main aim of the chapter is to propose a conceptual approach for the creation, exploitation and building of a competitive advantage through which it would be possible…

Abstract

The main aim of the chapter is to propose a conceptual approach for the creation, exploitation and building of a competitive advantage through which it would be possible to create a unique place from tourism space. In the chapter we present theoretical basement for the issue of competitive advantage at the level of places, its types, factors and approaches for its creating, building and exploiting. In the chapter we specify one main hypothesis and one research question. They are verified through several scientific, statistical and mathematical methods. These methods are used for the evaluation of primary and secondary research results. In the final part of the chapter, a conceptual approach for identification and exploitation of competitive advantage aimed at building unique and competitive places was proposed.

Details

Marketing Places and Spaces
Type: Book
ISBN: 978-1-78441-940-0

Keywords

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Article
Publication date: 17 November 2020

Ricardo Jorge Correia, José G. Dias and Mário Sérgio Teixeira

This paper aims to explore a new causal link between market orientation and business performance by introducing dynamic capabilities as a mediator of the relationship…

Abstract

Purpose

This paper aims to explore a new causal link between market orientation and business performance by introducing dynamic capabilities as a mediator of the relationship between market orientation and competitive advantages, which ultimately determine business performance.

Design/methodology/approach

The mediating roles of dynamic capabilities and competitive advantages are tested with a sample of 1,190 Portuguese firms using a structural equation model.

Findings

The results confirm the hypotheses regarding the mediating roles of the competitive advantages (differentiation and cost leadership) in the relationship between dynamic capabilities and business performance. Additionally, dynamic capabilities also mediate the relationship between market orientation and competitive advantages.

Practical implications

This study shows that business performance depends on the capacity of firms to collect the best market information on customers and competitors, to disseminate this information throughout their internal structure and ultimately optimize its use to respond appropriately to market challenges and trends. These will provide firms with a set of capabilities and a competitive advantage.

Originality/value

This study provides empirical evidence on the understanding of the relationship between market orientation and performance, through the mediating effects of both dynamic capabilities and competitive advantages.

Details

Journal of Strategy and Management, vol. 14 no. 2
Type: Research Article
ISSN: 1755-425X

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Article
Publication date: 21 May 2020

Jorge Ferreira and Arnaldo Coelho

The purpose of this paper is to understand the impact of dynamic capabilities (DC) (in the view of exploration and exploitation) on competitiveness and performance…

Abstract

Purpose

The purpose of this paper is to understand the impact of dynamic capabilities (DC) (in the view of exploration and exploitation) on competitiveness and performance, considering the mediating role the innovation capability (IC) and branding capabilities (BC)on competitive advantage and firm’s performance and the moderating role of entrepreneurial orientation (EO).

Design/methodology/approach

This investigation proposes a theoretical model tested using structural equation modelling (SEM). Multi-group analysis was performed to understand the moderating role of. A questionnaire survey was developed to explore the relations between DC and innovation variable. For this study, 387 valid questionnaires were collected from a sample of Portugal SME’ firms. A 90-item questionnaire which consists to study the relationships among all the variables.

Findings

The results show that exists a positive direct and indirect influence of DC on competitive advantage and performance variables and mediating impact the IC and BC.

Research limitations/implications

This study has some methodological limitations affecting its potential contributions. As a cross-sectional study that captures one image in time, its ability to identify strict causality between variables is limited. Furthermore, the results are based on log collected from a key respondent, rather than broader actual data. The results are restricted to one country, Portugal. Some variables, such as ICs, may play a different role in other countries. Future research should initially target different countries. Such research could then test the generalizability of the results.

Practical implications

This study has important implications for the managers. It highlights the necessity of firms to develop superior strategic orientation of all their members and to invest in better resources and consequently superior capabilities as a way of achieving high levels of firm performance. Another implication from the study is that the firms should develop their marketing programs by focusing on developing innovativeness.

Originality/value

This study contributes to the understanding of the indirect and direct impact of exploration and exploitation variables, and the mediating role of ICs and BC on the competitive advantage and performance and the moderating effect of EO.

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