Competition network as a source of competitive advantage: The dynamic capability perspective and evidence from China

The search for competitive advantage is the defining inquiry of strategic management research. In this study, we draw on the dynamic capability lens to develop a counterintuitive view that positions competitors of a firm as an important source of competitive advantage. We argue that a firm's competitors form a competition network from which it can collect information about innovative ideas, product market, and related industries. Such information helps it calibrate market opportunities, update the resource base, and, eventually, strengthen its competitive advantage. This positive effect of competition network on competitive advantage will reasonably be contingent upon the proactive information search by the firm. The empirical results based on the survey data of 631 Chinese firms strongly support our theoretical model. This study identifies another distinctive source of competitive advantage than industry context or organizational resources as well as advancing our understanding of competition network.     

From Temporary Competitive Advantage to Sustainable Competitive Advantage

Both industrial organization theory (IO) and the resource‐based view of the firm (RBV) have advanced our understanding of the antecedents of competitive advantage but few have attempted to verify the outcome variables of competitive advantage and the persistence of such outcome variables. Here by integrating both IO and RBV perspectives in the analysis of competitive advantage at the firm level, our study clarifies a conceptual distinction between two types of competitive advantage ? temporary competitive advantage and sustainable competitive advantage ? and explores how firms transform temporary competitive advantage into sustainable competitive advantage. Testing of the developed hypotheses, based on a survey of 165 firms from Taiwan's information and communication technology industry, suggests that firms with a stronger market position can only attain a better outcome of temporary competitive advantage whereas firms possessing a superior position in technological resources or capabilities can attain a better outcome of sustainable competitive advantage. More importantly, firms can leverage a temporary competitive advantage as an outcome of market position to improving their technological resource and capability position, which in turn can enhance their sustainable competitive advantage.     

Transformer in navigation: Diverse government roles for open innovation in China's high-speed rail

Based on a longitudinal case study of China's high-speed rail embedded in the emerging economy context, we focus on what role the government plays and how that matters to open innovation (OI) for competitive advantage. By linking the OI literature with the national political institutions literature to motivate our research question, we propose a statist-based OI view to differentiate diverse government roles, investigating how government adopts roles in a combined way to push OI in stages. Our findings suggest that government is an important strategic decision-maker for OI. Specifically, the government plays various roles as commander, protector, cultivator, and intermediator, reflecting state activism derived from national political institutions, to construct institutional-level OI for domestic OI activities, and inbound and outbound OI across national borders. We find government can deliberately and strategically use its diverse roles in a combined way to push OI for competitive advantage through the industrial evolutionary process over time. Our study contributes to the OI literature and integrates the strategic management literature with the study of OI to provide new insights to explain the origins of competitive advantage from the state perspective.     

双重视角下的竞争优势:内涵、代表性研究与基本分析单位

竞争优势是战略管理研究领域的核心概念。但是,现有文献对竞争优势的理解与分析视角存在着诸多差异,导致竞争优势的分析单位也不尽相同。为推动竞争优势理论的整合,本文从双重视角审视竞争优势的概念及代表性研究,并提出把产品作为竞争优势基本分析单位的分析逻辑与重要意义,为竞争优势理论的整合和发展提供了一个新的思路。     

Managing White‐Collar Work: An Operations‐Oriented Survey

Although white‐collar work is of vast importance to the economy, the operations management (OM) literature has focused largely on traditional blue‐collar work. In an effort to stimulate more OM research into the design, control, and management of white‐collar work systems, this paper provides a systematic review of disparate streams of research relevant to understanding white‐collar work from an operations perspective. Our review classifies research according to its relevance to white‐collar work at individual, team, and organizational levels. By examining the literature in the context of this framework, we identify gaps in our understanding of white‐collar work that suggest promising research directions.     

Introduction to Innovation WITHIN and ACROSS Borders: A Review and Future Directions

Innovation is an integral part of every firm's ongoing operations. While new product and service creation is an essential task to ensure a firm's immediate success in the marketplace, process and supply chain innovations can also create a unique source of competitive advantage for the future. Encouraging innovative thinking, developing new innovations, and managing the processes by which those innovations are developed are critical aspects of today's firm. Consequently, research which aids in the creation and maintenance of innovative firms is an important topic of inquiry for research communities on innovation management, including the operations management and information systems communities. We review the literature in this important area and offer suggestions for future research on the following topics: innovation within a firm and across the supply chain, technology management, and new product and service development.     

Strategy implementation: A review and an introductory framework

Effective strategy implementation is a critical component of organizational success and a potential source of competitive advantage. However, despite many calls for increased attention, research on the subject remains a disparate constellation of recommendations, case studies, and empirical work that provides insight but lacks a cohesive framework. As a result, strategy research most often treats implementation as a black box and overlooks sources of performance heterogeneity derived from differences in strategy implementation effectiveness. To improve our understanding of the strategy implementation process, and to promote its inclusion in strategy research, the authors systematically review and synthesize findings in the extant strategy implementation literature to abductively derive an integrative framework comprised of three components: (1) actions through which managers influence the implementation process, (2) conditions necessary for strategy implementation effectiveness, and (3) the underlying dynamic managerial capabilities to create the best possible combination of conditions by enacting the most appropriate managerial actions. By explaining the relationships among these three components, we provide an introductory foundational framework on which to build future knowledge about this important field of inquiry.     

Beyond products: new strategic imperatives for developing competencies in dynamic environments

Strategy research has often taken a product-centered perspective. When firms compete in environments characterized by accelerating product life cycles, mass customization, and technological discontinuities, a product-centered perspective on strategy may help explain a firm’s current competitive advantage. However, this perspective adds little guidance in making strategies that create competitive advantage in the future. In this paper, we present a perspective in which dynamic environments require firms to focus on (1) building market-driven, technological, and integration competencies, not a stream of product improvements, and (2) decoupling these competencies from current products in order to create and exploit new opportunities. We discuss the perspective of products as a temporary integration of market and technology trajectories. Research propositions are presented and future implications are discussed.     

A contingency approach to resource‐creation processes

The resource‐based view has provided valuable insights into sources of competitive advantage, but little attention has been paid to the processes of resource creation. To address this shortcoming, this paper reviews the strategy process literature, explaining the theoretical positions and assumptions that underpin different types of process. It then examines the mechanisms by which resources have been found to be created; luck, resource picking, internal development and alliances. Next, a series of resource‐creation pathways that illustrate the different routes firm inputs might take on the way to becoming unique and valuable resources is developed. These pathways are also discussed in terms of the strategy processes through which they are developed, and the appropriate resource‐creation processes. The review is then extended with the introduction of two contingent variables ? task complexity and environmental stability – and the resource‐creation processes that are congruent with different combinations of these variables are explored. From this review, one is able to identify the combination of complex task and stable environment likely to be the most conducive to resource creation. Finally, the paper explores opportunities that firms might have to engineer stability and complexity in some parts of their operations with the aim of developing a resource‐based advantage.     

A review of empirical research on dynamic competitive strategy

Beginning with Chandler's 1962 seminal work, researchers have emphasized that competitive strategy is not a static phenomenon, but rather a sequence of interconnected actions and reactions unfolding over time. This paper reviews the empirical research on dynamic competitive strategy published between 1986 and 2005 in nine leading strategic management journals. An integrated framework is used to showcase the research in terms of antecedents, strategic actions and outcomes. The literature review demonstrates that significant progress has been made in the field of dynamic competitive strategy, and yet that there are still many promising lines of inquiry for future theoretical and empirical research, particularly in the areas of strategic action timing and path dependency.     

Chinese expatriate management in emerging markets: A competitive advantage perspective

Recent research draws attention to the large number of expatriates sent abroad by Chinese multinational corporations (CMNCs), especially to emerging markets. It is generally assumed that their large number, and any competitive advantage this generates, relate predominantly to their low cost, compared to other MNCs' expatriates and/or locally available labour. Our research uses an integrative perspective drawing on the resource-based view (RBV), international human resource management (IHRM) and “country of origin” literature and extensive case-study research on 27 CMNCs in 12 emerging markets. This reveals that the competitive advantage created by Chinese expatriates is closely related to the use of expatriates at both managerial and operational levels. It is achieved through human resource management that exploits their relatively lower cost, higher productivity and hardship tolerance (compared to host or third country counterparts) and their knowledge/resource reconfiguration capability, through a centralised and collective expatriation management system. These together enhance CMNCs' competitive advantage through not only offering cost effective and differentiated products but also transferring the reconfiguration knowledge. This study enhances understanding of the competitiveness of emerging market multinationals (EMNCs) by showing how the competencies, combination and management of their expatriates create a distinct source of competitive advantage. It also advances IHRM research on expatriates by investigating their use from a competitive advantage perspective.     

Multi‐Product Quality Competition: Impact of Resource Constraints

We study a multi‐product firm with limited capacity where the products are vertically (quality) differentiated and the customer base is heterogeneous in their valuation of quality. While the demand structure creates opportunities through proliferation, the firm should avoid cannibalization between its own products. Moreover, the oligopolistic market structure puts competitive pressure and limits the firm's market share. On the other hand, the firm has limited resources that cause a supply‐side fight for adequate and profitable production. We explicitly characterize the conditions where each force dominates. Our focus is on understanding how capacity constraints and competition affect a firm's product‐mix decisions. We find that considering capacity constraints could significantly change traditional insights (that ignore capacity) related to product‐line design and the role of competition therein. In particular, we show that when the resources are limited, the firm should offer only the product that has the highest margin per unit capacity. We find that this product could be the diametrically opposite product suggested by the existing literature. In addition, we show that for intermediate capacity levels, whereas the margin per unit capacity effect dominates in a less competitive market, proliferation and cannibalization effects dominate in a more competitive market.     

A Design Theory Approach to Building Strategic Network‐Based Customer Service Systems*

Customer service is a key component of a firm's value proposition and a fundamental driver of differentiation and competitive advantage in nearly every industry. Moreover, the relentless coevolution of service opportunities with novel and more powerful information technologies has made this area exciting for academic researchers who can contribute to shaping the design and management of future customer service systems. We engage in interdisciplinary research—across information systems, marketing, and computer science—in order to contribute to the service design and service management literature. Grounded in the design‐science perspective, our study leverages marketing theory on the service‐dominant logic and recent findings pertaining to the evolution of customer service systems. Our theorizing culminates with the articulation of four design principles. These design principles underlie the emerging class of customer service systems that, we believe, will enable firms to better compete in an environment characterized by an increase in customer centricity and in customers' ability to self‐serve and dynamically assemble the components of solutions that fit their needs. In this environment, customers retain control over their transactional data, as well as the timing and mode of their interactions with firms, as they increasingly gravitate toward integrated complete customer solutions rather than single products or services. Guided by these design principles, we iterated through, and evaluated, two instantiations of the class of systems we propose, before outlining implications and directions for further cross‐disciplinary scholarly research.     

Strategic Network Orchestration in Emerging Markets: China's Catch‐up in the High‐Speed Train Industry

Transitioning from catch‐up in production to catch‐up in innovation capabilities is essential to emerging market firms (EMFs) achieving internationalization and a competitive advantage. While some EMFs are now positioned among the world's most advanced firms, many struggle to become independent innovators. Thus, understanding how EMFs can develop internal absorptive capacity and progress towards catching up in innovation capabilities remains important. Our study seizes this research opportunity and develops a network‐based explanation of catch‐up, which complements existing technological and organizational explanations. Specifically, we address the question of ‘How does the orchestration of collaborative networks enable EMFs to catch up in production and innovation capabilities?’ by describing an important yet under‐researched process of strategic network orchestration and showcasing the dynamic interdependencies between network orchestration and organizational learning. Our study provides a detailed account of Chinese high‐speed train (HST) development from 1990 to 2020 and opens the possibility for future research on network orchestration in emerging market contexts. This provides EMF managers with a set of actionable network orchestration mechanisms that can be used when designing and purposefully managing their strategic nets of domestic and foreign partners.     

Strategy,core competencies and human resource development

HRD's traditional approach to competency focuses on superior individual performance. The concept of a core competency in the strategic literature, as reviewed here, considers it as an organizational capability that provides sustained competitive advantage. That model is examined and implications for HRD practice noted.     

Network closure's impact on firms’ competitive advantage: The mediating roles of knowledge processes

This study draws on the knowledge management and social network disciplines to examine the effect of network closure on organizations’ competitive advantage. We hypothesize that the level of network closure affects an organization's capability of knowledge identification, knowledge transfer, knowledge protection and knowledge institutionalization; these capabilities in turn affect an organization's competitive advantage. Thus, we model network closure as indirectly affecting an organization's competitive advantage. A Partial Least Square (PLS) analysis of the survey data of 78 Chinese petrochemical firms shows that network closure can both enhance and decrease an organization's competitive advantage. Network closure enhances an organization's competitive advantage by facilitating knowledge protection and transfer (via institutionalization), but decreases competitive advantage by hindering knowledge identification. Environmental dynamics that the organizations encounter are observed to moderate the effect of network closure. Combining our results with the findings from the literature, we propose that organizations operating in a dynamic environment, where the domain knowledge is in a state of flux, need to place great importance on knowledge identification; such organizations should choose a sparse network that allows them to receive diverse knowledge. In contrast, organizations operating in a stable environment should opt for a dense network to protect their knowledge and facilitate transfer of required knowledge.     

Investment in Facility Changeover Flexibility for Early Entry into High‐Tech Markets

A model is introduced to analyze the manufacturing‐marketing interface for a firm in a high‐tech industry that produces a series of high‐volume products with short product life cycles on a single facility. The one‐time strategic decision regarding the firm's investment in changeover flexibility establishes the link between market opportunities and manufacturing capabilities. Specifically, the optimal changeover flexibility decision is determined in the context of the firm's market entry strategy for successive product generations, the changeover cost between generations, and the production efficiency of the facility. Moreover, the dynamic pricing policy for each product generation is obtained as a function of the firm's market entry strategy and manufacturing efficiency. Our findings provide insights linking internal manufacturing capabilities with external market forces for the high‐tech and high‐volume manufacturer of products with short life cycles. We show the impact of manufacturing efficiency and a firm's ability to benefit from volume‐based learning on the dynamic pricing policy for each product generation. The results demonstrate the benefits realized by a firm that works with its manufacturing equipment suppliers to develop more efficient and flexible technology. In addition, we explore how opportunities afforded by pioneer advantage enable a firm operating a less efficient facility to realize long term competitive advantage by deploying an earlier market entry strategy.     

Operations Strategy Research in the POMS Journal

In this paper, we examine the operations strategy literature in the POMS journal to determine what has been learned and to suggest new directions for further study in this important area of research. Our review of this literature resulted in the selection of thirty‐one relevant articles, many of which draw upon multiple theoretical perspectives. We identify eight such theoretical perspectives, and go on to classify these perspectives in terms of the scope of inquiry employed in the research (focused versus aggregated) and the researcher's assumptions about choice processes (behavioral versus rational). In doing so, we show that this body of work is dominated by papers that draw upon theoretical perspectives enabling a more holistic scope of inquiry, with a bias towards a view of strategy as a highly rational process. Building on our systematic review and integration of the literature, we suggest multiple areas for future research.     

Learner Engagement: A New Perspective for Enhancing Our Understanding of Learner Motivation and Workplace Learning

Abstract

Organizations invest millions of dollars in workplace learning programs to develop human capital for competitive advantage. The effectiveness of workplace learning programs is directly linked to learner motivation. However, we contend that our current understanding of learner motivation and workplace learning is limited by the tendency to conduct research based on the traditional instructional system design model and the limited adoption of organizational behavior theories to guide such research. We propose that studying workforce learning from a psychological engagement perspective is necessary to gain a better understanding of learner motivation and subsequent knowledge and skill acquisition. We review studies of learning methods and contextual factors that likely influence learner engagement. We propose a research agenda focusing on six directions for future research.     

Strategic Corporate Social Responsibility and Value Creation among Large Firms: Lessons from the Spanish Experience

Can corporate social responsibility (CSR) be a source of good and a wellspring of innovation, competitive advantage and value creation for the firm? Although CEOs and government leaders insist in public that CSR projects create value for the firm, privately they admit that they do not know if CSR pays off. To address this question and drawing on experience for the Spanish context, we test one of the few efforts to model how the strategic management of CSR may contribute to improving firm profitability (Burke and Logsdon, 1996). To do this, we examine the impact of three strategic CSR variables – visibility, appropriability, and voluntarism – on value creation among large Spanish corporations. The conclusions from these findings suggest that managers need to understand how CSR is similar to and different from other traditional corporate market activities if they are to pursue value creation through CSR. We also suggest avenues for future research to explain how CSR may be integrated into firm processes to create resources (assets) and capabilities (routines) that may lead to competitive advantage and superior economic performance.