2023 (see paper)
What is more important to the success of a firm – the non-imitability or non-substitutability of its
strategic resources? Discuss in relation to theory and illustrate with examples.
Non-substitutability is important to be resilient to creative disruption, and becomes increasingly
important as cycles of tech disruption shorten and rate of tech improvement accelerates
o ...
Non-imitability enables firms to build a strong position in business-as-usual context. Without
non-imitability, no SCA even in the short-term
o (Dierickx and Cool 1989)- factors making resource non-imitabile enables SCA
Other barriers to imitability as isolating mechanisms for SCA
o (Besanko et al 2007) access to scarce input; EoS with limited market size
Strong position from non-imitability enables it to protect against substitutes by innovation
o Standard para
Strong position from non-imitability enables it to protect against substitutes as fast follower
o Standard para
Strong position from non-imitability enables it to protect against substitutes by acquisitions
o Standard para
See my sketch 2019.1 answer
What are the tactics that Michael Porter’s Five Forces framework allows for to position a firm
competitively within an industry? Discuss in relation to theory and illustrate with examples.
Apple has invested enormous resources in building the capacity to produce its own M1 computer
chips. Why? Discuss in relation to theory and illustrate with examples.
Asset erosion and time compression diseconomies are important dynamics underpinning the creation
of a sustainable competitive advantage in the resource-based view of strategy. Are there synergies or
trade-offs between these two specific dynamics? Discuss in relation to theory and illustrate with
examples.
2022
Could it be said that both the positional and the resource-based view in competitive strategy miss out
on how a competitive advantage comes about in the first place? Discuss and illustrate with examples.
My answer is not great... SEE MY v2 sketched outline under time... may be better
Intro:
o Early academic literature on RBV miss out on explaining where VRIN resources come
from and how they can be acquired
o But later developments partially resolve this by giving clues as to the process behind
how these resources are produced
o Positional view misses out on explaining
, Intra-industry variation and CA
What enables firms to select certain generic or positional strategies which is the
true source of the CA. Often, these are internal firm resources.
RBV Miss out: early criticisms that RBV was not pragmatically useful, miss out on explaining
where VRIN resources come from in the first place
o Early literature:
VRI in the context of when culture can produce sustained CA (Barney 1986),
expanded to VRIN (Barney 1991).
Core competency theory (Prahalad & Hamel 1990)
o Examples:
GE's power generator and jet engine business require advanced materials and
turbine engineering. Does not explain how GE obtained these core
competencies in the first place.
Fujifilm knowledge of chemicals and antioxidants applied to cosmetics Astalift
product. Samsung's OLED displays to smartphone market
o Criticism: analytic, tautological definition (Priem & Butler 2001), also little practical use
for managers since VRIN resources are hard to imitate and are rare to acquire.
RBV Does not completely miss out: explains what makes resources inimitable, and thus give
clues to how to develop inimitable resources
o Inimitable resources come about by investing in something that does not erode quickly
(asset erosion) over a long time (time compression diseconomies), that is easier to
acquire as you build up its stock (asset mass efficiencies), and easier to acquire due to
related pre-existing resources a firm has (inter-connectedness) (Dierickx & Cool, 1989)
o Refute of RBV criticism, useful for managers to actively cultivate/ exploit resources
(Barney 2001)
o Examples:
US CPG higher market share and perceived quality near origin city. Brand takes
time to form (Bronnenberg et al. 2009)
VCs (Sequoia) and incubators (YC) may want to strive to ensure high returns and
multiple successful moonshot investments in early funds to build a reputation
that results in better deal flow. Takes time and is a positive feedback loop.
Brand recognition and trust takes time to build- when neobanks (Monzo,
Revolut, Wise). Build by having good customer service and support over time.
Positional Miss out: does not explain intra-industry variation. Misses out a big chunk of where
CA comes from
o 5 forces (Porter, 1979) explains how industry structure affects industry profitability, and
competitive strategy involves taking actions to influence the structure in the firm's
favour, but CA between firms within industry not explored
o If firm matters more (Rumelt 1991) then it does not explain CA very well at all
o Example:
What is more important to the success of a firm – the non-imitability or non-substitutability of its
strategic resources? Discuss in relation to theory and illustrate with examples.
Non-substitutability is important to be resilient to creative disruption, and becomes increasingly
important as cycles of tech disruption shorten and rate of tech improvement accelerates
o ...
Non-imitability enables firms to build a strong position in business-as-usual context. Without
non-imitability, no SCA even in the short-term
o (Dierickx and Cool 1989)- factors making resource non-imitabile enables SCA
Other barriers to imitability as isolating mechanisms for SCA
o (Besanko et al 2007) access to scarce input; EoS with limited market size
Strong position from non-imitability enables it to protect against substitutes by innovation
o Standard para
Strong position from non-imitability enables it to protect against substitutes as fast follower
o Standard para
Strong position from non-imitability enables it to protect against substitutes by acquisitions
o Standard para
See my sketch 2019.1 answer
What are the tactics that Michael Porter’s Five Forces framework allows for to position a firm
competitively within an industry? Discuss in relation to theory and illustrate with examples.
Apple has invested enormous resources in building the capacity to produce its own M1 computer
chips. Why? Discuss in relation to theory and illustrate with examples.
Asset erosion and time compression diseconomies are important dynamics underpinning the creation
of a sustainable competitive advantage in the resource-based view of strategy. Are there synergies or
trade-offs between these two specific dynamics? Discuss in relation to theory and illustrate with
examples.
2022
Could it be said that both the positional and the resource-based view in competitive strategy miss out
on how a competitive advantage comes about in the first place? Discuss and illustrate with examples.
My answer is not great... SEE MY v2 sketched outline under time... may be better
Intro:
o Early academic literature on RBV miss out on explaining where VRIN resources come
from and how they can be acquired
o But later developments partially resolve this by giving clues as to the process behind
how these resources are produced
o Positional view misses out on explaining
, Intra-industry variation and CA
What enables firms to select certain generic or positional strategies which is the
true source of the CA. Often, these are internal firm resources.
RBV Miss out: early criticisms that RBV was not pragmatically useful, miss out on explaining
where VRIN resources come from in the first place
o Early literature:
VRI in the context of when culture can produce sustained CA (Barney 1986),
expanded to VRIN (Barney 1991).
Core competency theory (Prahalad & Hamel 1990)
o Examples:
GE's power generator and jet engine business require advanced materials and
turbine engineering. Does not explain how GE obtained these core
competencies in the first place.
Fujifilm knowledge of chemicals and antioxidants applied to cosmetics Astalift
product. Samsung's OLED displays to smartphone market
o Criticism: analytic, tautological definition (Priem & Butler 2001), also little practical use
for managers since VRIN resources are hard to imitate and are rare to acquire.
RBV Does not completely miss out: explains what makes resources inimitable, and thus give
clues to how to develop inimitable resources
o Inimitable resources come about by investing in something that does not erode quickly
(asset erosion) over a long time (time compression diseconomies), that is easier to
acquire as you build up its stock (asset mass efficiencies), and easier to acquire due to
related pre-existing resources a firm has (inter-connectedness) (Dierickx & Cool, 1989)
o Refute of RBV criticism, useful for managers to actively cultivate/ exploit resources
(Barney 2001)
o Examples:
US CPG higher market share and perceived quality near origin city. Brand takes
time to form (Bronnenberg et al. 2009)
VCs (Sequoia) and incubators (YC) may want to strive to ensure high returns and
multiple successful moonshot investments in early funds to build a reputation
that results in better deal flow. Takes time and is a positive feedback loop.
Brand recognition and trust takes time to build- when neobanks (Monzo,
Revolut, Wise). Build by having good customer service and support over time.
Positional Miss out: does not explain intra-industry variation. Misses out a big chunk of where
CA comes from
o 5 forces (Porter, 1979) explains how industry structure affects industry profitability, and
competitive strategy involves taking actions to influence the structure in the firm's
favour, but CA between firms within industry not explored
o If firm matters more (Rumelt 1991) then it does not explain CA very well at all
o Example:
