Avoiding Failure And Sustaining Competitive Advantage


2

Avoiding Failure And Sustaining Competitive Advantage

 

When a company loses its competitive advantage, its profitability falls. The company does not necessarily fail, it may just have average or below-average profitability and can remain in this mode for a considerable time, although its resources & capital base is shrinking.

Reasons for failure:

a)   Inertia:

The Inertia argument says that companies find it difficult to change their strategies & structures in order to adapt to changing competitive conditions.

b)   Prior strategic commitments:

A company’s prior strategic commitment not only limits its ability to imitate rivals but may also cause competitive disadvantage.

c)   The Icarus Paradox:

According to Miler, many companies become so dazzled by their early success that they believe more of the same type of effort is the way to future success.  As a result, they can become so specialized and inner directed that they lose sight of market realities and the fundamental requirements for achieving a competitive advantage.  Sooner or later, this leads to failure.


Like it? Share with your friends!

2
BMS Team

We, at BMS.co.in, believe in sharing knowledge and giving quality information to our BMS students. We are here to provide and update you with every details required by you BMSites! If you want to join us, please mail to [email protected].

203 Comments


Warning: Undefined array key "html5" in /home/bmsnewco/public_html/wp-content/plugins/facebook-comments-plugin/class-frontend.php on line 140

Facebook comments:

This Website Is For Sale. Email us an offer we cannot refuse on [email protected] :)

X
Choose A Format
Personality quiz
Series of questions that intends to reveal something about the personality
Trivia quiz
Series of questions with right and wrong answers that intends to check knowledge
Poll
Voting to make decisions or determine opinions
Story
Formatted Text with Embeds and Visuals
List
The Classic Internet Listicles
Countdown
The Classic Internet Countdowns
Open List
Submit your own item and vote up for the best submission
Ranked List
Upvote or downvote to decide the best list item
Meme
Upload your own images to make custom memes
Video
Youtube and Vimeo Embeds
Audio
Soundcloud or Mixcloud Embeds
Image
Photo or GIF
Gif
GIF format