Imitation by rivals is most challenging when resources are unique. resources mus
ID: 465158 • Letter: I
Question
Imitation by rivals is most challenging when
resources are unique.
resources must be built over time.
capabilities reflect a high level of social complexity and causal ambiguity.
resources and capabilities require a high level of capital investment.
All of these choices are correct.
a.resources are unique.
b.resources must be built over time.
c.capabilities reflect a high level of social complexity and causal ambiguity.
d.resources and capabilities require a high level of capital investment.
eAll of these choices are correct.
Explanation / Answer
Ans.: c. Capabilities reflects a high level of social complexity and causal ambiguity.
Organizations gain competitive advantage by either doing what others can’t, or by doing what others can but doing it better. Alternatively, organizations van also gain competitive advantage by acquiring casually ambiguous or uncertain resources, making it difficult for the competition to imitate.
When firms invest in resources that have a high level of social complexity, they gain the potential of attaining competitive advantage, as these resources and capabilities become very difficult for the competitor to imitate. For example, Jack Welch, of GE, in an interviewed stated the socially complex resource that GE has made its competitive advantage was their ability for fast learning and then rapidly transforming that learning into action.
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