CMI Essay Example | Topics and Well Written Essays - 1750 words

CMI - Essay ExampleWhat can be seen in practice is non-homogeneous firms achieving competitive advantage in different ways. There is evidence, for example, that in industries where scale is considered to be very important, small-scale innovations have completely opened up the competition, This became abstemious in the stagnating steel industry, where mini-mills grew rapidly in answer to the demand for all kinds f specialist products. In the Netherlands, large-scale shipyards were engaged in a argue for survival--with all eyes focused on the government for subsidies--while at the same time specialist firms were successful in the fields f yacht-building and dredging. The great differences in profitability between firms within the same industry are difficult to explain by resorting to neoclassical theory. (Rumelt 169-185) For these differences lie in the introduction f innovational concepts, brand-new combinations f production factors and the smart use f technologies. The internal side f the firm plays a crucial part in this. Firms bid Primark and McDonalds, for example, have developed specific routines and skills which are difficult for competitors to imitate. The existence f this sort f firm-specific competencies does not fit in very well with the cookbook metaphor f neoclassical economics. The new insights indicate that a sustainable competitive advantage can only be attained by creating new organization-specific knowledge.On the cutting edge f strategic management and evolutionary economics, a debate is currently taking place about new theories f the firm in which the special qualities f knowledge are incorporated. In these theories, static thinking is replaced by a more realistic process perspective. Concepts akin limited rationality (or even trial and error), path dependency and heterogeneity are all embraced. The role f soft variables like knowledge, culture and net income relations is