Scanning dynamic competitive landscapes: a market-based and resource-based framework

Heterogeneity among rivals implies that each firm faces a unique competitive set, despite overlapping market domains. This suggests the utility of a firm-level approach to competitor identification and analysis, particularly under dynamic environmental conditions. We take such an approach in develop...

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Bibliographic Details
Published in:Strategic management journal 2003-10, Vol.24 (10), p.1027-1041
Main Authors: Peteraf, Margaret A., Bergen, Mark E.
Format: Article
Language:English
Subjects:
Bias
Business strategies
Business studies
Competition
Competitive advantage
Competitiveness
competitor identification
Corporate strategies
Economic competition
Economic performance
Economic resources
Economics
Environmental management
Environmental scanning
Identification
Management
Management science
Management theory
Managers
Marketing
Marketing strategies
Natural resources
Quadrants
Rationality
Resource management
resource-based theory
Scarcity
Studies
Sustainability
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Summary:Heterogeneity among rivals implies that each firm faces a unique competitive set, despite overlapping market domains. This suggests the utility of a firm-level approach to competitor identification and analysis, particularly under dynamic environmental conditions. We take such an approach in developing a market-based and resource-based framework for scanning complex competitive fields. By facilitating a search for functional similarities among products and resources, the framework reveals relevant commonalities in an otherwise heterogeneous competitive set. Beyond its practical contribution, the paper also advances resource-based theory as a theory of competitive advantage. Most notably, we show that resource substitution conditions not only the sustainability of a competitive advantage, but the attainment of competitive advantage as well. With equifinality among resources of different types, the rareness condition for even temporary competitive advantage must include resource substitutes. It is not rareness in terms of resource type that matters, but rareness in terms of resource functionality.
ISSN:0143-2095
1097-0266
DOI:10.1002/smj.325