Four Approaches to Sustaining Competitive Advantage

Subject: Company Analysis
Pages: 2
Words: 512
Reading time:
2 min

The reason behind this particular method of ranking is due to the fact that, as of late, technology-oriented enterprises have espoused the necessity of innovation and development as necessary factors in order to grow and develop a company.

Industry-level competitive forceStrategic conflictThe resource-based perspectiveDynamic capabilities approach
Theoretical perspectiveThe competitive force’s approach focuses mainly on creating defensible positions against competitive forces. This can take the form of controlling the supply of particular resources or competitive pricing schemes which shuts out the competition (seen in the case of Walmart)This particular approach views competitive outcomes as a function
of the effectiveness with which firms keep
their rivals off balance through strategic investments,
pricing strategies, signaling, and the control
of information
When it comes to the resource-based perspective, this particular strategic method emphasizes firm-specific capabilities
and assets and the existence of isolating mechanisms
as the fundamental determinants of firm
performance. This means that service/product characteristics that are unique to the firm are determiners of the success of the company.
Under the dynamic capabilities perspective, the method of wealth creation utilized by various technology-oriented enterprises is based upon the distinctive processes, assets and knowledge utilized.
Barriers to entry, responsiveness to changes within the business environmentGame theoryEfficiency and cost reductionDevelopment of new technologies and methods of operations
Managerial prescriptionsThe managerial prescriptions for this particular perspective focus on the competitive environment in which the company is currently present. As such, managerial practices are often based on the actions of other companies and focus on creating barriers to entry.This particular approach emphasizes the use of influence in order to control the behavior of competitors as well as the current market environment that the company finds itself in.Practices in line with this particular approach emphasize the implementation of efficient methods of operations which reduces the costs associated with regular operations as well as the production of various goods and servicesThis particular approach focuses mainly on honing internal technological, organizational, and managerial processes inside the firm. In
short, identifying new opportunities and organizing effectively and efficiently the company’s current method of operations. Focuses on complex systems and how companies can adapt to an ever-changing business climate.
Yoffie & Kwak, 2006
-Focuses on company responses to competitor actions within particular markets.
Chakravorti, 2004
-in line with the strategic conflict perspective since it focuses on game theory.
Anderson et al. 2006
-Focuses on the concept of customer value propositions and how they can be effectively utilized by a company.
et al. 2008
-Focuses on the concept of change within a company’s business model and how it can be utilized to improve performance.

This can be seen in the case of Apple Inc., which is considered the world’s most valuable company. After this comes other perspectives related to competitive forces, strategic conflict, and the resource-based perspective, all of which play a role in contemporary literature in showcasing how companies operate at present. The one limitation in the research utilized for this particular section is that it focused heavily on technology-oriented enterprises and did not focus on other enterprises which are just as relevant in today’s market economy.