Organizational Learning

Question:

“The increasing turbulence in the external business environment has focused attention on the resources and organizational capabilities as the principal source of competitive advantage.” (2009, p.204).

Discuss with reference to appropriate literature sources, the extent to which the creation, sharing and utilization of knowledge is central to this resource based view of competitive advantage.

Introduction

The main concern of this study is to discuss the “increasing turbulence in the external business environment has highlighted the attention on the resources and the organizational capacities as the principal source of the competitive advantage”. As per the statement of Botha, Kourie and Snyman (2014), sustainable development cannot happen without innovation. The challenges before each of the company are to develop innovative strategies, which not only respond to the environmental changes as well as the societal pressure but also include the necessity and the expectations of several stakeholders. The intention of the research project can highlight how an organization within an emerging market economy changed the organizational strategy from being an implementer. In addition, Fr?czek et al., (2016) opined that organizations would adapt the changing in the external environment, which would occur due to the global economic crisis.

This study will highlight the effect of having to the changing strategy, on the capacity and the development of the organization. A research on holding organization subsidiary associations cannot be completed without investigation. Therefore, this essay would look specifically at the economic turmoil, which is the time of global financial crisis during 2008, 2009. The importance of controlling the integrating mechanism within the organizations would reduce the uncertainty, as well as increase the predictability. Therefore, this would assure that organizational behavior would separate the parts of the organization, which would be compatible and support the organizational goals. Okeyo (2015) opined that global trade contracted quickly and also rigorously during the period of global crisis. This would make discrimination to the business environment and also the demand of all of the organizations.

Competitive advantage and strategic environment:

Strategic management can be defined as lying down of decisions and actions ensuing in formulation and execution of strategies that are being designed for attaining the organizational objectives. Strategic management is apprehensive in defining the performance of organization along with the strategic choice of variables and competitive advantage.

The major role of competitive advantage may develop from the perspectives of military and economy derivation of strategy literature. Strategic management has primarily been a body of knowledge that emphasizes managers with practical advice. Porter’s argument for competitive advantage was that it is a considerable determinant for bigger feat. A firm’s big performance crops up from the sustainable competitive advantages resulting in Ricardian rents and monopoly rents. Ricardian rents produce resources that are firm specific by intangible and internal inputs like leadership and knowledge, whereas, Ricardian rents takes account of refurbishing advantages over a period by innovation.

Market-Based View (MBV):

The Market-Based view of strategy perceives that factors related to industry and orientations of external market are the prime determinants of feat of firms. The framework of Structure-Conduct-Performance (SCP) and Porter’s Five Forces Model are two of the better-known theories in this segment. A firm’s strategic position is an unambiguous set of activities that are different from their rivals. On the other hand, a firm’s strategic position is stated on ways it accomplish similar sort of activities to other firms, but in ways that are different.