Strategic Commitment And Corporate Competitive Advantage

Sources of competitive advantage for firm have been the themes in the field ofstrategic management. However, different theories hold different standpoint. In this paper,we mainly conduct analysis to the structure school and resource school and try to find theirtheoretical explanation about the sources of firm's competitive advantage.The structure school which is represented by Porter lays their attention on the studyof external industrial environment, and thinks the search for key successful factors ofindustry are the hinge of strategy management, so they stresses the position in the industryaccording to the analyses to the industry structure. Being different from the outside-inresearch approach, the resource school adopts a different method in explaining thecompetitive advantage of firms. They focus their research on the inside of firms, andconsider the resource as the objects of analysis and try to find the key successful factors inthe source of firms. With the assumption that firms are composed of idiosyncratic assets,they think the different idiosyncrasy of firm's resource result in the difference ofperformance in the market.Through analyses, these two schools of thoughts have successfully explained thesources of competitive advantages from different angles which are both necessary. Thecomplementary nature between the two views makes it possible to include them into anintegrated framework. In line with this view, the key successful factors exist both in theinside and outside environment.However, the key factors which influence firms` successes can't totally explain howthe firms form the competitive advantage. In other words, these two views bothexcessively attach the importance on the key successful factors and ignore the firms`actions. There lacks intermediate mechanism which could connect the KSF andcompetitive advantage. Ghemawat adopts the view of commitment and regards the degreeof commitment as the cause of the difference in performance.The paper starts with the view of commitment, and puts forwards the concept ofstrategic commitment, regards it as the intermediate mechanism contacting the KSF andcompetitive advantage. Strategic commitment is a long-term action conducted by firm,which has restriction to the firms` future choices, and it consists of a series of decisionswhich have strategic influence on the firm's future development, and these decisions forma strategic path for the firm. Through strategic commitment the firm can accumulate someidiosyncratic resources in the different strategic path.In this paper, our analyses are focus on the following aspects: firstly, we give adetailed theoretical explanation about the formation mechanism of strategic commitment,and then we seek its function in the accumulation of strategic resources. In the final section,we study the implementation of the strategic commitment from two aspects, the division ofresources and the flexibility in the course of strategic commitment.