Comp. Adv

A Critique of Competitive Advantage Jeremy Klein, Scientific Generics, Cambridge, CB2 5GG, UK +44 1223 875200, fax +44 1223 875201 jklein@scigen.co.uk Strategy Stream Critical Management Studies Conference, July 2001 Manchester While there have been critiques of specific types of competitive advantage such as Porter’ so called ‘ s generic strategies’ and of strategy recipes to achieve these advantages, this paper seeks to problematize the concept itself. Despite its ubiquity, the concept of competitive advantage is surprisingly under-defined. At its worst, it is nothing more than a tautology: successful firms are successful because they have competitive advantage, which in turn cannot be defined in any other way than as a quality that brings about success. Defining the possession in terms of the outcome it produces presents ontological difficulties: both in cases when competitive advantages is posited ex ante and in situations where the chain of causality is contestable. The use of the term competitive advantage has obscured the need to better understand competition as distinct from strategy. The paper identifies some different modalities of competition and suggests that most of these are poorly theorized. The contingent nature of these modalities suggests that competition might itself be a historically specific process, indicating that the fads of strategic thought might reflect genuine changes in underlying competitive processes.

INTRODUCTION ‘ Competitive advantage is at the heart of a firm’ performance in competitive s markets. After several decades of vigorous expansion and prosperity, however, many firms lost sight of competitive advantage in their scramble for growth and pursuit of diversification. Today the importance of competitive advantage could hardly be greater. Firms throughout the world face slower growth as well as domestic and global competitors that are no longer acting as if the expanding pie were big enough for all.’ Thus begins Michael...