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Competitive Strategy Concepts, Competitive Strategy Concepts, eg.…
Competitive Strategy Concepts
Resource Similarity
How similar resources (technology, skills, assets) are between two companies.
Firms with similar resources can respond to each other's moves quickly.
Competitive Asymmetry
The unbalanced view of rivalry between companies; one may see the other as a major competitor, while the other does not.
Influences each company’s priority in monitoring and reacting.
Market Commonality
The extent of overlap in markets where two companies compete.
High overlap means direct competition; one company’s actions directly impact the other.
Competitive Strategy Concepts
Resource Similarity
Firms
with similar resources ( like tech, skills, or assets ) between two companies
can respond to each other's moves quickly.
eg. Airline
use similar planes for similar routes
have higher resource similarity
Market Commonality
measures how much firms compete in the same markets
higher market commonality
results in greater awareness of competitors' actions.
stronger predictor
of competitive behavior than resource similarity.
high commonality
view each other as top competitors & operating in the same markets
Competitive Asymmetry
competitive RS are not always equal.
one firm sees the other as a key competitor, while the other doesn’t
eg. American Airlines
AA
TW's view AA is a primary competitor
eg. Trans World Airlines
TW
AA's view TW is a minor competitor
Behavioral Implications
Predicting Behavior
eg, A firm may prepare for competitive actions if it recognizes a primary competitor.
Motivation to Act
Competitor Mapping
display competitors based on
Market Commonality
Resource Similarity
eg. AA vs. Delta Airlines
Impact
different perceptions lead to varied strategies and better anticipation of competitors' actions.
eg. Southwest Airlines (
WN
)
eg. America West Airlines (
HP
)
closely monitor & react each other's actions
in fare changes, service adjustments
Competitive Asymmetry
Firms
can perceive different competitors
based on shared markets and resources.
Propositions
Proposition 2b:
greater resource similarity leads to more likely responses.
Proposition 3
market commonality is a stronger predictor of competitive actions
Proposition 4a:
competitive asymmetry exists between firms.
Proposition 4b:
likelihood of attack differs between competitors due to asymmetry.
Delta
's main competitor is
AA
:red_cross:
sees different main competitors
Delta
&
AA
share many of the same markets, but their views differ.
AA'
s main competitor is United Airline (
UA
)