Constellation of competitive advantage: components and dynamics

To achieve persistent superior performance, a firm needs competitive advantages, a constellation of them. Superior firms typically do not do just one thing well, they often excel in multiple aspects. Nurturing an evolving constellation of multiple advantages and undertaking timely renewals help carry the firm through competition over time. To maintain healthy dynamics of a firm’s constellation of advantage, the following tasks should be carefully attended to: establishment of dominant advantage which defines the firm’s core purpose and identity; accumulation of supporting advantages to complete the constellation; amplification of complementary advantages for maximum performance; trade‐off among competing advantages for long‐term viability; and renewal of both dominant and supporting advantages, in adaptation to changes in the firm, competition, and the general environment. Knowledge of the relationship between and interaction of multiple advantages is essential for managing a firm’s advantage constellation, a critical challenge facing general managers.