Competitive Advantage And External Factors

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. Competitive advantage requires organizational awareness of internal and external factors in a relational context. Categorically, external factors are political, economic, sociocultural, technological, ecological, and legal in nature. Rothaermel defined the organization’s external environment as all factors with the potential to alter the competitive advantage, creating opportunities and threats; considering the global nature of trade and economies, this potential is amplified. After the Brexit Referendum passed, the value of the pound declined, subsequently impacting consumer confidence (bbc.com, 2016). This event encompassed political, economic, sociocultural, and legal factors that caused an upheaval for businesses in the United Kingdom and abroad. Osterwalder and Pigneur (2010) described external factors of demand as the circumstances, with respect to design drivers and constraints, that reveal the business model (BM) position and provide a juncture for discerning adjustment; these factors empower the organization to deliberate on the impact of new trends, evaluate how the BM may evolve, and prompt innovation. The role of external factors serves to apprise the BM designer of trends and events significant to the organizational…show more content…
These forces address the agents, their roles, and their influence on the BM. Market forces analyze issues, segments, needs and demands, switching costs, and revenue attractiveness. Industry forces analyze competition in respect to incumbents, insurgents, substitutes, value chain actors, and stakeholders. Key trends signal technology, regulatory, societal and cultural, and socioeconomic effects. Macroeconomic forces analyze markets, commodities, and economic infrastructure. Brexit impacted each of these

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