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The Two Faces of Competition: Dynamic Resourcefulness and the Hypercompetitive Shift

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  • L.G. Thomas

    (Goizueta Business School, Emory University, Atlanta, Georgia 30322)

Abstract

Competition in the American economy has fundamentally changed over the last few decades, from static to dynamic. This study labels this important change the hypercompetitive shift , and documents it across 200 industries of the US manufacturing sector during I958 to 1991. For industries that undergo a hypercompetitive shift, there is an increase in the cross-firm variance in performance and a rotation in the value-rivalry relationship from a negative association to an inverted-U. As a consequence of these competitive changes, the strategic focus of firms shifts from careful exploitation of given, highly durable strategic assets to the steady creation of many new, rapidly depreciable ones.The key driver of hypercompetitive shift is the dynamic resourcefulness of an industry, or the ease with which new strategic assets can be created. Determinants of dynamic resourcefulness include the dynamism of related transactors (notably consumers and suppliers). the knowledge base of the industry, and structural conditions that promote easy entry.

Suggested Citation

  • L.G. Thomas, 1996. "The Two Faces of Competition: Dynamic Resourcefulness and the Hypercompetitive Shift," Organization Science, INFORMS, vol. 7(3), pages 221-242, June.
    • Handle: RePEc:inm:ororsc:v:7:y:1996:i:3:p:221-242
    DOI: 10.1287/orsc.7.3.221
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    Cited by:

    1. Kassem HAMMOUD & Jaber ABDALLAH, 2019. "Empirical Analysis On Strategy And Hyper - Competition With Smes," Proceedings of the INTERNATIONAL MANAGEMENT CONFERENCE, Faculty of Management, Academy of Economic Studies, Bucharest, Romania, vol. 13(1), pages 951-960, November.
    2. Cynthia A. Lengnick-Hall & Tammy E. Beck, 2009. "Resilience Capacity and Strategic Agility: Prerequisites for Thriving in a Dynamic Environment," Working Papers 0059, College of Business, University of Texas at San Antonio.
    3. Frank T. Rothaermel & Charles W. L. Hill, 2005. "Technological Discontinuities and Complementary Assets: A Longitudinal Study of Industry and Firm Performance," Organization Science, INFORMS, vol. 16(1), pages 52-70, February.
    4. Romero-Martínez, Ana M. & Fernández-Rodríguez, Zulima & Vázquez-Inchausti, Elena, 2010. "Exploring corporate entrepreneurship in privatized firms," Journal of World Business, Elsevier, vol. 45(1), pages 2-8, January.
    5. Short, Jeremy C. & Palmer, Timothy B., 2003. "Organizational performance referents: An empirical examination of their content and influences," Organizational Behavior and Human Decision Processes, Elsevier, vol. 90(2), pages 209-224, March.
    6. Kathryn Rudie Harrigan & Maria Chiara DiGuardo, 2017. "Sustainability of patent-based competitive advantage in the U.S. communications services industry," The Journal of Technology Transfer, Springer, vol. 42(6), pages 1334-1361, December.
    7. Prasad, Acklesh & Green, Peter & Heales, Jon, 2012. "On IT governance structures and their effectiveness in collaborative organizational structures," International Journal of Accounting Information Systems, Elsevier, vol. 13(3), pages 199-220.
    8. Harvey, Michael & Novicevic, Milorad M., 2002. "The hypercompetitive global marketplace: the importance of intuition and creativity in expatriate managers," Journal of World Business, Elsevier, vol. 37(2), pages 127-138, July.
    9. Prasad, Acklesh & Heales, Jon & Green, Peter, 2010. "A capabilities-based approach to obtaining a deeper understanding of information technology governance effectiveness: Evidence from IT steering committees," International Journal of Accounting Information Systems, Elsevier, vol. 11(3), pages 214-232.
    10. Cheng-Hua Tzeng & Paul Beamish & Shih-Fen Chen, 2011. "Institutions and entrepreneurship development: High-technology indigenous firms in China and Taiwan," Asia Pacific Journal of Management, Springer, vol. 28(3), pages 453-481, September.
    11. Paul M. Vaaler & Gerry McNamara, 2010. "Are Technology-Intensive Industries More Dynamically Competitive? No and Yes," Organization Science, INFORMS, vol. 21(1), pages 271-289, February.
    12. Hill, John W. & Zeller, Thomas L., 2008. "The new value imperative for privately held companies: The why, what, and how of value management strategy," Business Horizons, Elsevier, vol. 51(6), pages 541-553.
    13. Sirkka L. Jarvenpaa & Dorothy E. Leidner, 1998. "An Information Company in Mexico: Extending the Resource-Based View of the Firm to a Developing Country Context," Information Systems Research, INFORMS, vol. 9(4), pages 342-361, December.
    14. Pierre Roy, 2007. "De l’intérêt des firmes dominantes à perturber et stabiliser le jeu concurrentiel," Revue Finance Contrôle Stratégie, revues.org, vol. 10(3), pages 139-160, September.
    15. Boris Durisin & Riccardo Lizzola, 2009. "Same as it ever was, really? An empirical study on the sustainability of superior performance of public companies in the US and in Europe from 1987 to 2007," KITeS Working Papers 011, KITeS, Centre for Knowledge, Internationalization and Technology Studies, Universita' Bocconi, Milano, Italy, revised 2009.
    16. Frank T. Rothaermel & Maria Tereza Alexandre, 2009. "Ambidexterity in Technology Sourcing: The Moderating Role of Absorptive Capacity," Organization Science, INFORMS, vol. 20(4), pages 759-780, August.
    17. William C. Bogner & Pamela S. Barr, 2000. "Making Sense in Hypercompetitive Environments: A Cognitive Explanation for the Persistence of High Velocity Competition," Organization Science, INFORMS, vol. 11(2), pages 212-226, April.
    18. Basu, Sandip & Phelps, Corey & Kotha, Suresh, 2011. "Towards understanding who makes corporate venture capital investments and why," Journal of Business Venturing, Elsevier, vol. 26(2), pages 153-171, March.
    19. Gautam Ray & Dazhong Wu & Prabhudev Konana, 2009. "Competitive Environment and the Relationship Between IT and Vertical Integration," Information Systems Research, INFORMS, vol. 20(4), pages 585-603, December.
    20. Chris R. Meyer & David G. Cohen & Sudhir Nair, 2017. "Some have to, and some want to: Why firms adopt a post-industrial form," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 21(2), pages 533-559, June.
    21. Mudassir Hussain & Hashim Ali, 2019. "How to Supervise International PhD Students: A Narrative Inquiry Study," International Journal of Higher Education, Sciedu Press, vol. 8(5), pages 143-143, October.
    22. Hülsmann, Michael & Grapp, Jörn & Li, Ying, 2008. "Strategic adaptivity in global supply chains--Competitive advantage by autonomous cooperation," International Journal of Production Economics, Elsevier, vol. 114(1), pages 14-26, July.
    23. Bill McKelvey, 1999. "Avoiding Complexity Catastrophe in Coevolutionary Pockets: Strategies for Rugged Landscapes," Organization Science, INFORMS, vol. 10(3), pages 294-321, June.

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