Organizational resources and establishing competitive advantage 1. Introduction The potential of organizations to develop a competitive advantage is depending on a series of factors. Most commonly, the level of achievement of the organizational goals and the profitability of a firm are regarded as key criteria in order to evaluate whether a company is successful or not…
Download file to see previous pages...
On the other hand, it has been made clear that not all organizations are able to effectively develop their resources. Also, the continuous increase of competition in the global market is a factor that can negatively influence the efforts of organizations to improve their position in the market using their resources and capabilities. It seems that in the long term, the transformation of organizational resources into a competitive advantage has to be carefully managed since the challenges in the internal and the external organizational environment are likely to be many; as the conditions in the organizational environment become more hostile, under the influence of the global market pressures, the support that an organization has to provide to its resources has to be increased, otherwise their chances to become a competitive advantage are significantly reduced. At this point, the following issue appears: how an organization can secure that its resources will become, even in the long term, competitive advantage? It seems that such prospect cannot be considered as guaranteed, especially in industries where competition is high. This issue is further analyzed in the sections that follow using the literature published in this field. 2. Organizational resources and their use for the establishment of competitive advantage 2.1 How an organization can establish competitive advantage from its resources The identification of the exact characteristics of competitive advantage in modern organizations is a challenging task. Researchers and theorists have tried to identify the criteria under which organizational resources can become competitive advantage, but the results of their studies seem to be contradictory. Most commonly, emphasis is given on the balance between the firm’s strengths and weaknesses, as the specific relationship can also affect the firm’s opportunities and threats. The interaction of the above sectors in the context of organizational growth is reflected in the SWOT analysis framework. The above framework is based on the view that firms that are likely to emphasize on their internal strengths and control their weaknesses are more able to face environmental threats, a fact that can help them to develop competitive advantage towards their rivals (Barney 1995). However, the terms under which the specific effort would be successful should be further explored. Indeed, even if effectively organizing its internal environment and if it tries to avoid major market risks, a firm has still to face the threat of an unexpected downturn if there are no other strategic alternatives in place, as for example strategic alliances with other firms that control an important share of the relevant industry. On the other hand, Peteraf (2006) noted that there are certain conditions that can increase the potentials of an organization to develop a competitive advantage. These conditions could be described as follows: ‘superior resources (heterogeneity within an industry), ex post limits to competition, imperfect resource mobility, and ex ante limits to competition’ (Peteraf 2006, p.179). It is assumed that organizations that seek to develop a competitive advantage should focus on the particular conditions. This view can be criticized as of the lack of explanations regarding the potentials of these conditions to exist in all
...Download file to see next pagesRead More
Cite this document
(“Organizational resources and establishing competitive advantage Essay”, n.d.)
Retrieved from https://studentshare.org/business/1393231-strategic-management
(Organizational Resources and Establishing Competitive Advantage Essay)
“Organizational Resources and Establishing Competitive Advantage Essay”, n.d. https://studentshare.org/business/1393231-strategic-management.
This research is being carried out to evaluate and present models except for the matrix structure in which there is some sense of focus targeted on vertical organizations synonymous with subordinate-superior relations. This is at times necessary but may become an inhibitor in rapidly changing environments.
The changes are based on transformations which are occurring, specifically to give corporations a new competitive advantage against other corporations to find the best human assets and to receive more opportunities with the growing forces and businesses. Each of these is establishing new structures and alterations in the expectations that are a part of the organizational structures and establishments.
ADDING CUSTOMER VALUE FOR COMPETITIVE ADVANTAGE Introduction Every company, no matter how competitive, minor or large, mainly relies on its reputation for success, existence and customer value. Clients, workforce, suppliers, investors, communication networks and regulators may have a fundamental effect; they all have crucial views concerning the companies they interact with every day.
Organizational culture refers to the pattern of shared values, assumptions, and beliefs in an organization. On the other hand, competitive advantage refers to a phenomenon in which a specific organization in the entire industry is capable of making higher profits, as compared to its competitors.
It is the economic rent that makes most competitors imitates other companies competitive advantage thus it becomes impossible for any given company to sustain its competitive advantages a longer duration of time. However, a company can have some positions, strategies and processes that are hard to be copied by other companies.
This ensures that the most productive people are brought to the front and appreciated accordingly. In most other workplaces, all people earn equal salaries whether they work equally or not.
On the downside, the worker’s pays are not
In the recent international ratings, the company is the world’s largest furniture retailer. Historically, IKEA was founded in 1943 by Mr. Ingvar Kampard in Sweden. Initially, it sold pens, wallets, watches, jewelry, picture frames, table runners and nylon stockings. By 1947, IKEA had begun stocking furniture mainly produced by local manufactures.
Currently, the rapidly changing globalized economies are resulting in major challenges to many organizations in trying to move in accordance with global changes in the business world. The challenges faced by HR managers in attaining these objectives have led most of them to rethink strategies for ensuring organizations attain.