Critical Success Factors of Sustainable Competitive Advantage: A Study in Malaysian Manufacturing Industries

Abstract

To develop a theory relating to SCA, one needs to define the measurement criteria for SCA. In recent times,although there were many researches that were undertaken focusing in the area of Sustainable CompetitiveAdvantage (SCA), there is still, however, a lack of an operational definition for SCA. There is no one agreedupon method for evaluating sustainable competitive advantage for business organizations and hence themeasurement criteria for SCA have not been established despite the extensive focus in the area. In the past,performance indicators such as profitability or market share have always been used to justify the determinants ofthe SCA. Should both the factors play a leading role in determining the SCA, what about other auxiliary orperipheral factors that could be a contributing point? There should be a quantitative numerical value that depictsthe sustainability of a manufacturing organization. The key objectives of this study are to examine the definitionand the various viewpoints on Sustainable Competitive Advantage and subsequently to develop a measurementcriterion that represents Sustainable Competitive Advantage. Given such kind of scenario, the initial step wouldbe to develop or create an operational definition for SCA. This paper hence is an attempt to explore the variousviewpoints on literatures on Sustainable Competitive Advantage and to develop dimensions that representsSustainable Competitive Advantage. We conceptualized a framework to evaluate the influence of four variablesnamely; Effective Supply Chain Management (2) Product differentiation and Innovation, (3) Organizationalresponsiveness; and (4) Cost Leadership. The study is based on empirical data collected from a survey ofmanagers of Malaysian manufacturing industries. The data were collected through an email survey, and had 300valid responses. The analysis shows that all the four hypotheses were supported. The findings of this studywould assist in defining a more precise way of achieving a sustainable competitive advantage in Malaysianmanufacturing industries.