A Resource Based and Context Dependent Model of Firm Competitivenes

Abstract

In today’s global business environment, competitiveness is very crucial for superior performance in marketplace. In order to survive and be profitable, firms should establish and improve competitive advantage over their competitors. However, competitive advantage is not an easy concept to define and evaluate. Several factors, directly or indirectly, affect and jointly determine the competitive strength of an individual firm. The challenge is the identification of the specific factors, and how and to what extent they affect firm competitiveness. This study addresses these questions through a new model of firm competitiveness which incorporates both the firm specific (internal firm resources) and the environment based determinants (industry and country-related factors) of competitive advantage and specifies how and under which conditions firm resources can lead to competitive advantage and how the industry and the country-related factors can affect the value of firm resources for competitiveness.