Can Competitive Advantage Be Sustainable?
CAN COMPETITIVE ADVANTAGE BE SUSTAINABLE?
As worldwide markets continue to converge through the growing phenomenon which we know as Globalisation, competition is becoming more stubborn and fiercer than ever before. Indigenous companies are now faced by emerging foreign competitors, rivals that have arrived on foreign shores equipped with deeper knowledge, broader competencies and richer resources than that of their indigenous counterparts. In addition to the knock-on effects that Globalisation has had on competition between organisations, today’s economic climate that we have engulfed ourselves in had created further problems for successful businesses. This recessionary era has placed a further barrier in front of organisations’ leaders, a barrier which they must overcome to continue to harvest profits, remain successful and ultimately sustain their competitive advantage which will help to ensure survival for the foreseeable future. To achieve this feat, the organisation must first identify its competitive advantage within the industry. Once this is achieved, the firm can focus on trying to sustain their competitive advantage. A fundamental question that must be asked here however, is whether competitive advantage is sustainable.
“Sustainable competitive advantage” as a concept is rather vague. Much of the research surrounding the concept is debatable and open to various interpretations. (Coyne, 1986) maintains that “perhaps it is because the meaning of ‘sustainable competitive advantage’ is superficially self-evident that virtually no effort has been made to define it explicitly”. For an organisation, acquiring a competitive advantage is achievable but can competitive advantage be sustainable? Michael Porter who has put much effort into the conceptualisation of Sustainable Competitive Advantage characterises the concept as “the fundamental basis of above-average performance in the long run” (1985; 12). This view signifies his belief that to sustain a
As worldwide markets continue to converge through the growing phenomenon which we know as Globalisation, competition is becoming more stubborn and fiercer than ever before. Indigenous companies are now faced by emerging foreign competitors, rivals that have arrived on foreign shores equipped with deeper knowledge, broader competencies and richer resources than that of their indigenous counterparts. In addition to the knock-on effects that Globalisation has had on competition between organisations, today’s economic climate that we have engulfed ourselves in had created further problems for successful businesses. This recessionary era has placed a further barrier in front of organisations’ leaders, a barrier which they must overcome to continue to harvest profits, remain successful and ultimately sustain their competitive advantage which will help to ensure survival for the foreseeable future. To achieve this feat, the organisation must first identify its competitive advantage within the industry. Once this is achieved, the firm can focus on trying to sustain their competitive advantage. A fundamental question that must be asked here however, is whether competitive advantage is sustainable.
“Sustainable competitive advantage” as a concept is rather vague. Much of the research surrounding the concept is debatable and open to various interpretations. (Coyne, 1986) maintains that “perhaps it is because the meaning of ‘sustainable competitive advantage’ is superficially self-evident that virtually no effort has been made to define it explicitly”. For an organisation, acquiring a competitive advantage is achievable but can competitive advantage be sustainable? Michael Porter who has put much effort into the conceptualisation of Sustainable Competitive Advantage characterises the concept as “the fundamental basis of above-average performance in the long run” (1985; 12). This view signifies his belief that to sustain a