Sources and Outcomes of Competitive Advantage: An Exploratory Study in the Furniture Industry

Abstract

Abstract We examine a model of the relationships among sources and outcomes of competitive advantage. The model is integrative across business functions and research disciplines. Functional area competencies are considered as sources of advantage, and three competency constructs are introduced: marketing competency, product design and development (innovation) competency, and manufacturing competency. Each functional area construct is defined as the sum of the performance on 31 competitive items, weighted by importance and extent of responsibility. Relationships between the competency constructs (and their interactions) with performance outcomes such as ROI and market share are analyzed. Results from this exploratory study suggest that innovation is a key source of competitive advantage.