Analysis of Sustainable Competitive Advantage in Global Climate

This report examines the concept of sustainable competitive advantage within the context of the global climate. It explores how organizations can achieve and maintain a competitive edge through differentiation strategies, focusing on attributes that distinguish their products or services and cater to market demands. The report highlights the significance of differentiation, discussing its benefits such as cost advantage, market segmentation opportunities, and increased customer loyalty. It also addresses potential challenges to sustaining competitive advantage, including competitor actions, time-related factors, and internal issues like employee resistance and organizational structure. The report uses Walmart's pricing strategy as an example of a successful differentiation strategy. Overall, the report emphasizes the importance of differentiation in establishing a unique market position and sustaining competitive advantage in the current global climate.

Running Head: GLOBAL CLIMATE 0
SUSTAINING COMPETITIVE
ADVANTAGE

GLOBAL CLIMATE 1
Sustainable competitive advantage can be related to uniqueness that an organisation
possesses and any other organisation cannot imitate. Having sustainable competitive
advantage is termed as a critical strategy which is undertake by the organisation to grab a
larger market segement including diverse customers. Sustainable competitive advantage
occurs when an enterprise is staying ahead in four extents – differentiation, quality,
effectiveness and innovation (Baumgartner and Ebner, 2010). With the help of competitive
advantage, an organisation can gain various opportunities for new products to disrupt
incumbent industries. However, there is also a stringent relationship amid differentiation and
sustainable competitive advantage. Considering differentiation strategy, an organisation
decides to select a specific attribute of the product to focus on. Moreover, this attribute is
required to include significant characteristics that can cater to bigger section of market
demand as well as stimulate customers to pay premium price for the product. On the other
hand, if the attribute is not valued highly adequate by the market, the company will only gain
average returns.
In the path of sustainable competitive advantages, there are some challenges also that
negatively influence solid differentiation strategy of an organisation. For instance, the market
place does not stand still as shrewd competitors will look at the success of an enterprise and
attempt to impact or copy it. Moreover, the time also acts as a barrier to differentiation
strategy in relation with sustaining competitive advantage as over time, when a distinctive
attribute may be neutralised, the competitive advantage will be vanished. The internal
challenge which may put barrier to an organisation sustainable competitive advantage
includes employee resistance to innovation, centralised organisation structure and capability
of research and development department (McWilliams and Siegel, 2011).
In the current global climate, differentiation advantage allows organisation and management
to contrast their products with rival products in the marketplace and underline the distinctive
characteristics that sort their product superior. Differentiation strategy also brings out various
other benefits such as cost advantage, opportunities to grab other market segments and higher
customer attractiveness and loyalty (O'Shannassy, 2008).
Differentiation strategy benefitted various organisation to sustain competitive advantage in
the whole marketplace. For instance, the differentiation strategy of Walmart is – “Pricing”.
All actions and strategy of Walmart are specifically focused to keep prices low and this helps

GLOBAL CLIMATE 2
them to sustain as an influential market force in all geographical space at where they have
roots of their business.
To sum up, various big organisations perceive differentiation strategy as a fuel to sustain
competitive advantage in the industry and establish a unique and distinct position among the
customer's outlook.

GLOBAL CLIMATE 3
References
Baumgartner, R.J. and Ebner, D. (2010) Corporate sustainability strategies: sustainability
profiles and maturity levels. Sustainable Development, 18(2), pp.76-89.
McWilliams, A. and Siegel, D.S. (2011) Creating and capturing value: Strategic corporate
social responsibility, resource-based theory, and sustainable competitive advantage. Journal
of Management, 37(5), pp.1480-1495.
O'Shannassy, T. (2008) Sustainable competitive advantage or temporary competitive
advantage: Improving understanding of an important strategy construct. Journal of Strategy
and Management, 1(2), pp.168-180.