Administrative Skill as Competitive Advantage: Extending Porter's Analytical Framework

Powell, Thomas (1993) Administrative Skill as Competitive Advantage: Extending Porter's Analytical Framework. Canadian Journal of Administrative Sciences, 10 (2). pp. 141-153.

Abstract

Competitive advantage is produced by resources that allow a firm to become more profitable than its competitors. Strategic management studies based on Porter's competitive strategy model assume that such resources are based on competitive positioning, i. e., on cost leadership or differentiation strategies, or on strategic group membership bolstered by mobility barriers. The theme of this study is that administrative skills - particularly the ability to align an organization's structure, strategymaking, and environment – provide an important, but neglected, source of competitive advantage. Consistent with a resource-based view of the firm, it is shown that these skills meet all the criteria for a strategic resource– they not only produce economic value, but are also scarce, imperfectly imitable, and imperfectly tradeable in factor markets. In an empirical study, it is shown that administrative skills account for a significant proportion of profitability variance, over and above the proportions accounted for by industry or strategic group membership.

Item Type: Article
Keywords: Competition; Strategy; Administration; Administrative Skills
Subject(s): Strategy; Entrepreneurship & Global business
Centre: Faculty of Strategy, Entrepreneurship and International Business
Date Deposited: 19 Feb 2012 20:54
Last Modified: 23 Oct 2015 14:06
URI: http://eureka.sbs.ox.ac.uk/id/eprint/2245

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