Knowledge Management and the Competitive Strategy of the Firm

Topics: Management, Knowledge management, Strategic management Pages: 3 (761 words) Published: April 5, 2013
Knowledge management and the competitive strategy of the firm Leila A. Halawi, Richard V. McCarthy, Jay E. Aronson

First the paper discussed the Porter's Five Forces Analysis. It is an vital instrument for assessing the profitability in an industry. With a little alteration, it is functional as a way of assessing the stability of influence in more general circumstances. It works by analyzing at the power of five forces that influence competition: the supplier power, which is the power suppliers have that could drive up the prices of inputs. The second is the buyer power, which is the power of clients to force down prices. Third is the competitive rivalry, which analyzes the force of rivalry in the industry. The fourth force is the threat of substitution, this force study the degree to which different products and services can be used in position of its own. The last force is the threat of new entry, it finds the ease with which new entrant can enter the market. Studying these factors can clearly state if the industry was attractive profit wise or not, if the competition was high or low, and show the place of the business in the industry. After that the paper discussed the resource-based view (RBV). RBV argues that firms resources, a subset of which allows them to achieve competitive advantage, and a division of those that guide to greater long-standing performance. Resources that are rare and valuable can lead to the formation of competitive benefit. Intangible resources are more possible to create competitive advantage than tangible resources.

After that the article states that there is no universal description of knowledge management (KM). In general KM is the method in which organizations produce value from their intellectual and knowledge-based assets. Mainly producing value from such assets engage in stating what employees, partners and clients know, and distribution that information between workers, departments and also with other firms in an attempt...
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