Page 110 - Managing Change in Organizations

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6 Theories of change: strategic

management models

Introduction

Are markets autonomous or does the availability of a product and service influ-
ence demand? Where does the balance lie and/or does this balance shift? Was
there a demand to fly between London and New York before the aeroplane was
invented? Clearly people wished to travel between these places, and just as clearly
the availability of the aeroplane led to them doing so by air, and the development
of mass transport by air had an impact on patterns of travel, leisure and so on.
This leads to a resource-based view of strategy as being of importance. From this
point of view resources and capabilities drive strategic change.

Strategic management: the resource-based view

The resource-based view of strategy derives from the observation that business
success cannot be explained wholly by market factors. If this were possible then
in the long run all companies operating in a given industry or sector would tend
to converge in terms of profit performance. This is clearly not the case. Why?

Answering this question does not preclude the need to be concerned about
sources of sustainable competitive advantage or to identify customer needs.
Rather it requires us to look at how each company goes about doing so. In effect
it is based on the notion that the way a company is configured to do so will vary
according to a range of circumstances including its history.
Lynch (2000) identifies the six main elements which appear worthy of exami-
nation when seeking to look at how companies may variously be positioned:

1 Prior to acquired resources.
2 Innovative capability.
3 Competitiveness.
4 Substitutability.
5 Appropriability.
6 Imitability.

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