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By Michael E. Porter

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By Michael E. Porter

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Additional info for Competitive advantage: Creating and Sustaining Superior Performance - With a New Introduction

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The strategic m andate to business units should be to achieve competitive advantage. Pursuit of leadership for its own sake may guarantee th at a firm never achieves a competitive advantage or th at it loses the one it has. A goal of leadership per se also embroils m anagers in endless debates over how an industry should be defined to calculate shares, obscuring once m ore the search for competitive advantage that is the heart of strategy. In some industries, m arket leaders do not enjoy the best perfor­ mance because industry structure does not rew ard leadership.

J. Heinz. Competing with the same generic strategy in m any business units is one way in which a diversified firm can add value to those units, a subject I will discuss in C hapter 9 when I examine interrelationships among business units. However, employing a comm on generic strategy entails some risks that should be highlighted. One obvious risk is that a diversified firm will impose a particular generic strategy on a business unit whose industry (or initial position) will not support it. Another, m ore subtle risk is that a business unit will be m isunderstood because of circum stances in its industry that are not consistent with the prevailing generic strategy.

Chap­ ter 15 shows how to attack an industry leader. It lays out the conditions 30 COMPETITIVE A D V A N T A G E a firm must meet to challenge a leader, and the approaches to changing the rules of com petition in order to do so successfully. The same principles involved in attacking a leader can be used in offensive strat­ egy against any competitor. Principles of Competitive Advantage 2 The Value Chain and Competitive Advantage Competitive advantage cannot be understood by looking at a firm as a whole.

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