Sources of sustainable competitive advantage and direction of development: a study on pharmaceutical SMEs

Abstract

To cope, preserve market position, and achieve sustainable competitive advantage (SCA), companies should put operations strategy into action systematically and coherently. In this vein, the purpose of this study is to evaluate small and medium-sized (SME) pharmaceutical firms in southern Vietnam considering their current strategic orientation, development path, and sustanability of competitive advantage. The method used in this research is Sense and Respond (S&R), supported with combination of different tools. The data has been gathered from six companies utilizing two questionnaires: “Manufacturing strategy index (MSI)” and “S&R”. The results show that, all case companies act as Analyzer both in the past and in the future when employing operations strategy. In all case companies, quality found to be the most important competitive priority in the past and future, and the main source of competitive advantage. Furthermore, spearhead technology and knowledge (T&K) found to be the main source of risk in operations strategy and SCA. The Weak Market Test demonstrates that the research results are consistent with the actual situations of the case companies. The research concludes that S&R method works well in evaluating the operative SCA of pharmaceutical SMEs.