Competitive strategies and barriers to achieving competitive advantage : a study of two Saudi Arabian industries. (2024)

Al-Awadh, Mohammed A M (1996)Competitive strategies and barriers to achieving competitive advantage : a study of two Saudi Arabian industries. PhD thesis, University of Sheffield.

Abstract

This study focuses on how organisations achieve and sustain competitiveadvantage and the possible barriers to this advantage. It first deals with atheoretical framework by examining related literature on developing a betterunderstanding of competitive advantage and generic strategies, as well as theimportant aspects that may affect a firm's achievement and the sustainability ofits competitive advantage. This study extends the strategic managementliterature on competitive advantage and generic strategies mainly based onPorter's (1980, 1985) work. In particular, instead of the two generic strategies(differentiation and cost leadership) put forward by Porter, four competitivestrategies are developed. These are (1) price leadership, (2) low costdifferentiation, (3) imitation and (4) differentiation.Barriers to competitive advantage are conceptionalised in terms of"strategic coherence" model, which has three aspects. Competitive strategiesrequire internal consistency referred to as 'competitive coherence'. In addition,'organisational coherence' needs to be built, involving the structure of internaland external elements affecting an organisation's ability to achieve itscompetitive advantage. The creation of this structure is not automatic. Thedifficulties increase with growing dynamism and complexity of the environmentin which an organisation is operating. While competitive and organisationalcoherence might exist accidentally, the third aspect developed in this study iscalled 'cognitive coherence'. The lack of coherence in one or more of theseaspects is a barrier to a firm achieving and sustaining its competitive advantage.Secondly, this study reports empirical evidence on the validity of the theoreticalframework. This study takes the case of two different industries (petrochemicaland food) in Saudi Arabia.Results indicate that all four competitive strategies are possible andstatistically defined. In addition, high-performing firms, in both industries, havemore strategic coherence than lower performing firms. The results suggest thathigh-performing firms are able not only to achieve their competitive advantagebut also to sustain it over time. Moreover, in each industry, firms with differentcompetitive strategies have different barriers to achieving their competitiveadvantage. These results are consistent with those found in the existingliterature, lending support to the view that western strategy models seem to beapplicable to developing countries such as Saudi Arabia.

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