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Sustainable Competitive Advantage (SCA) (capabilities and oceans (dynamic…
Sustainable Competitive Advantage (SCA)
Resource Based View
based on internal resources and competencies
criticised for ignoring the state of the market i.e. porter's five
alternative popular view is market positioning
Porter's Five Forces is based on positioning viewpoint (does this ignore -co-operation?)
based on the work of Barney
Porter on SCA
‘scope’ of customers targeted (i.e. focus strategy).
distinct prices
distinct products
examples
Monsoon ‘differentiates its products’
Evans’ uses focus strategy to scope customers on larger sizes.
Primark uses ‘cost leadership’
Not everyone can be a cost leader – though they may survive due to information asymmetry
uniqueness in prices
uniqueness the final product
uniqueness the customer service
uniqueness the operations
uniqueness the brand
or a mix of these plus other factors.
capabilities and oceans
dynamic capabilities = being able to update, renew, adopt and adapt capabilities
red ocean = full of life due to all the competition
blue ocean = little competition e.g. Oral B may have unique marketing allowing them to enter area
distinctive capabilities = unique edge required to compete successfully
threshold capabilities = minimum required to operate
strategic white space = 'niche' area e.g. The Body Shop
Strategic Clock
based on customer perceptions
suggests that organisations are able to move between strategies
porter contrarily argues that you need to stick to a strategy to risk being stuck in the middle where not strategy works well
Identify capabilities
value chain + value system analysis
activity mapping
create strategic lock-in where users become reliant on the product
Operating Systems
Razors
Apple products using same connectors and software
SWOT and TOWS
use above to identify threshold capabilities
use above + VRIO to identify distinctive capabilities