Untangling the Origins of Competitive Advantage
Name
IB_Untangling.pdf
Size
217.14 KB
Format
Adobe PDF
Checksum (MD5)
bd4d2fc4c11693b30d93b84cd670a6a3
Author(s)
Cockburn, Iain
Henderson, Rebecca
Stern, Scott
Date Issued
March 2000
Abstract
What are the origins of competitive advantage? Although this question is fundamental to strategy
research, it is one to which we lack a clear answer. As strategy researchers we believe that some firms consistently outperform others, and we have some evidence consistent with this belief (Rumelt, 1991; McGahan and Porter, 1997). We also have a number of well developed theories as to why, at any given moment, it is possible for some firms (and some industries) to earn supranormal returns. As of yet, however, we have no generally accepted theory C and certainly no systematic evidence C as to the origins or the dynamics of such differences in performance. We know, for example, why high barriers to entry coupled with a differentiated product positioning obtained through unique organizational competencies may provide a firm with competitive advantage. But we know much less about how barriers to entry are built: about why this firm and not that one developed the competencies that underlie advantage, and about the dynamic process out of which competitive advantage first arises and then erodes over time.
Description
A paper prepared for the
SMJ Special Issue on The Evolution of Firm Capabilities
Subjects
competitive advantage
consistently outperform
supranormal
strategy research
barriers
product positioning
supranormal returns
organizational competencies
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