and Reproducible Capabilities
The opportunity for your company to
competitive advantage is determined by
your capabilities of two kinds – distinctive capabilities and
reproducible capabilities – and their unique combination you create
capabilities – the characteristics of your company which cannot be
replicated by competitors, or can only be replicated with great
difficulty – are the basis of your
sustainable competitive advantage.
According to the
of the company, sustainable competitive advantage is achieved by
continuously developing existing and creating new resources and
capabilities in response to rapidly changing market conditions.
Distinctive capabilities can be of many kinds:
or tacit knowledge.
Reproducible capabilities are those that
can be bought or created by your competitors and thus by themselves
cannot be a source of competitive advantage. Many technical,
financial and marketing capabilities are of this kind. Your
distinctive capabilities need to be supported by an appropriate set
of complementary reproducible capabilities to enable your company to
sell its distinctive capabilities in the market it operates.
Long-term corporate success is linked
to the ability to innovate. Although corporate investment in
to existing products and processes does bring
growth, it is new game
changing breakthroughs that will launch company into new markets, enable
rapid growth, and create
high return on investment. Companies that are not bound by prevalent
fallacies and rules of conventional wisdom have been able to break out of
the pack, create a new highly profitable market niche, and
vs. Red Ocean Strategy
Radical innovation should be a continued
activity to help your company reinvent itself and maintain its
A corporation that builds on
utilizes skills that combine to strengthen
value chains and build greater competitive advantages. This leads to
whereby they become more productive together than independently.
Trust as a Distinctive Capability
Trust-based working relationships are an important
source of your
sustainable competitive advantage because trust is
valuable, rare, imperfectly imitable, and often nonsubstitutable...