Study note on competitive advantage

Study note on competitive advantage

References with extracted contents

Keith Walley & Des Thwaites (1996) A review, synthesis and interpretation of the literature on competitive advantage, Journal of Strategic Marketing, 4:3, 163-179.

"....while competitive advantage is an extremely important subject, it is also a very difficult one to study. Part of the reason for this is the welter of overlapping definitions which writers attach to the term (Day and Wensley, 1988)";

"According to Fahey (1989), competitive advantage is `anything that favourably distinguishes a firm or its products from those of its competitors in the eyes of its customers or end-users’. However, this definition takes a rather narrow view of competitive advantage in that by focusing on just those things which the customer sees, it is ignoring the many assets and skills which have generated those items";

"Competitive advantage can be derived from numerous sources and almost any and every article written on the subject of conducting business better or running an organization more efficiently could be construed to be concerned with creating competitive advantage (Lado et al., 1992). As such, the literature concerning competitive advantage is extensive and certainly too large to review in a single article";

"According to Porter (1985), there are just two routes to competitive advantage although they can be implemented on either a broad or narrow basis depending on the competitive scope of the company. One route is based on cost, the other on product differentiation. When applied on a broad basis, a company is trying to achieve `overall cost leadership’ and `overall product differentiation’ .";

"...Cecil and Goldstein (1990) .... postulate that `a sustainable competitive advantage is a capability of one competitor that cannot be duplicated by another’. A slightly different definition is provided by Bharadwaj et al. (1993) who, rather than claiming that a sustainable competitive advantage is one which cannot be duplicated, suggest that it is instead `one which resists erosion’ .";

Richard T. Mpoyi , Troy A. Festervand & S. Kim Sokoya (2006) Creating a Global Competitive Advantage for Sub-Saharan African Companies, Journal of African Business, 7:1-2, 119-137.

"Competitive advantage can be defined as a company’s ability to develop unique strategies that result in superior returns. Compared to companies from developing nations, companies from developed countries are more successful in creating and sustaining competitive advantage. This suggests the existence of a national context that determines whether companies have the ability to achieve a competitive advantage. According to Porter (1990), a set of national characteristics impacts a company’s global competitiveness";

"In less developed countries, ineffective institutions lead to political instability and economic uncertainty that drastically discourage investment and innovation. As a result, less developed countries do not take full advantage of extant resources, and their companies are unable to create a competitive advantage";

Damianos Sakas Dimitris Vlachos Dimitris Nasiopoulos, (2014),"Modelling strategic management for the development of competitive advantage, based on technology", Journal of Systems and Information Technology, Vol. 16 Iss 3 pp. 187 - 209.

"Competitive advantage is the one that characterizes an IT company that makes something better than all its competitors. However, the ability to perform an activity better than its competitors will lead to a sustainable competitive advantage, only if the particular activity is something that customers appreciate and at the same time cannot be easily duplicated by the competitors. For example, the ability to create computer circuits of faster processing may constitute a strong competitive advantage for a circuit manufacturer, but only if there is a need in the market for something like that";

Sigalas, C., V.P. Economou and N.B. Georgopoulos. 2013. "Developing a measure of competitive advantage" Journal of Strategy and Management 6(4), Emerald: 320-342.

"....Sigalas and Pekka Economou (2013) argue that apart from few definitions in the literature that define competitive advantage in a rather fuzzy manner (see e.g. South, 1981), all other statements, which implicitly define competitive advantage, can be classified into two main streams. The first stream defines competitive advantage in terms of performance .... whereas the second stream defines competitive advantage in terms of its sources or determinants ...... Hence, even though statements about competitive advantage abound in literature, its conceptually precise definition is elusive ..., an issue that has been classified as the “definitional problem of competitive advantage” ...";

"The poor theoretical definition, or stipulative definition, and operational definition of competitive advantage, lead to its poor operationalization which, according to Popper’s (1959) statements, stalls theory from being scientific, falsifiable and truth seeking. Thus, more work on developing a measure, or on operationalization, of competitive advantage is required before strong empirical tests are possible. However, prior to the development of a reliable and valid measure of competitive advantage, scholars have to identify a conceptually robust stipulative definition and to compose a comprehensive operational definition of competitive advantage (Sigalas and Pekka Economou, 2013)";

"Powell (2001) mentions that the competitive advantage hypotheses are tautologous and, hence, of little scientific value because they are true by definition and not falsifiable. Nevertheless, Powell (2001) argues that there remains some value in the research stream, if scholars adopt the pragmatic view as philosophy of science. On the other hand, some scholars have argued that there is no necessity to adopt Powell’s pragmatic view of competitive advantage, and there is room for more positivist research on the relationships between competitive advantage and performance";

"....the operational definition of competitive advantage can be expressed as follows: The above industry average manifested: exploitation of: a) all market opportunities, b) full (exploitation of) the market opportunities and c) more market opportunities than competitors, neutralization of: a) all competitive threats, b) full (neutralization of) the competitive threats and c) more competitive threats than competitors and reduction of: a) total expenses at a higher rate than competitors, b) operating expenses at a higher rate than competitors, c) total expenses divided by revenue to a higher extent than competitors and d) operating expenses divided by revenue to a higher extent than competitors";