Describe how competitive advantage can be created via strategic intent, giving examples of successful approaches of competitors

Question

What will be an ideal response?

Answer 1

An alternative framework for understanding competitive advantage focuses on competitiveness as a function of the pace at which a company implants new advantages deep within its organization. This framework identifies strategic intent, growing out of ambition and obsession with winning, as the means for achieving competitive advantage. Major theories related to this were presented by Gary Hamel and C.K. Prahalad. The basic approach is founded in the principles of W.E. Deming, who stressed that a company must commit itself to continuing improvement in order to be a winner in a competitive struggle. Many firms have gained competitive advantage by disadvantaging rivals through competitive innovation. Hamel and Prahalad define competitive innovation as the art of containing competitive risks within manageable proportions. They identify four successful approaches used by Japanese competitors. These are building layers of advantage, searching for loose bricks, changing the rules of engagement, and collaborating. Building layers of advantage refers to having a wide portfolio of advantages thereby reducing risk in any competitive encounters. A second approach takes advantage of the "loose bricks" left in the defensive walls of competitors whose attention is narrowly focused on a market segment or a geographic area to the exclusion of others. A third approach involves changing the so-called "rules of engagement" and playing by the rules set by industry leaders. A final source of competitive advantage is using know-how developed by other companies. Such collaboration may take the form of licensing agreements, joint ventures, or partnerships.