Competitive advantage seeks to address some of the criticisms of comparative advantage. Michael Porter proposed the theory in 1985. Porter emphasizes productivity growth as the focus of national strategies. Competitive advantage rests on the notion that cheap labor is ubiquitous and natural resources are not necessary for a good economy. The other theory, comparative advantage, can lead countries to specialize in exporting primary goods and raw materials that trap countries in low-wage economies due to terms of trade. Competitive advantage attempts to correct for this issue by stressing maximizing scale economies in goods and services that garner premium prices (Stutz and Warf 2009).
Competitive advantage occurs when an organization acquires or develops an attribute or combination of attributes that allows it to outperform its competitors. These attributes can include access to natural resources, such as high grade ores or inexpensive power, or access to highly trained and skilled personnel human resources. New technologies such as robotics and information technology can provide competitive advantage, whether as a part of the product itself, as an advantage to the making of the product, or as a competitive aid in the business process (for example, better identification and understanding of customers).
And in the war of business in our world.. we will beat our competition until we monopolize the market and control the market. We will be powerful and wealthy and we will rule the industry. We will be famous and we will be ruthless and our success will convey to our stakeholders and shareholders. Our purpose will be to control, manipulate and grow our footprint throughout the global economy. Our names and alias will be in every man, woman and child’s mind.
The problem is that no matter what industry we look at this is the case.
It isn’t that anyone has hidden the truth, it is simply that they are less than open about it.
I could find this for almost any industry. The brand persists but under “new management” and that we are blind to this because we simply don’t know.
These organizations compete with themselves to drive internal battles in order to create and generate more revenue. I am fine with competition and I am fine with market differentiation in an organization but I don’t think that branding and brand consumption in this way makes sense.
Not for profit organizations are the same.. So.. how do I get to competitive advantage?
If 5 companies come to bid on a contract and 4 of the 5 are owned by the same parent company then how many companies are actually competing for the contract?
This isn’t new business … this is old business http://en.wikipedia.org/wiki/Standard_Oil
As we continue down the road with Google and Amazon and other companies that are consuming smaller brands for lunch, we need to think about the impact to our true landscape and real competitive positioning. We need to consider the implications on cloud computing and knowledge / information sharing and we need to consider the implications of our global commerce. The legal factors and the gouging. I am always amazed when I see who owns what.. maybe you will find interest as well!