A Firm's Superior Performance

1544 WordsSep 11, 20157 Pages
A firm’s superior performance is contingent upon a sustainable competitive strategy and a firm’s strategy refers to ‘a set of actions that its manager takes to outperform its competitors and achieve superior profitability’ (Thompson, Peteraf, Gamble, & Strickland, 2016, p.3). A strategy becomes sustainable when it produces enduring success that can support the company’s consistent growth. The designing of a strategy entails the understanding the company’s present situation which are comprised of two distinct facets: external environment and internal environment (Thompson et al., 2016). It is generally accepted that the performance of a company is accelerated when the strategy encompasses the alignment of both external and internal environments of a company (Kaplan & Norton, 2008; Maier & Pop, 2012). In spite of this consensus, there is a longstanding debate regarding whether external or internal environment has greater influence on the company’s performance (Wit, 2010). For some logical perspectives, it is favored that a firm’s internal environment has greater influence on the firm’s performance than external environment. In alignment with the argument, pertinent strategic concepts and theories are analyzed along with the example of a company, Toyota Motor Corporation. This argumentative essay flows starting with a brief overview of Toyota Motor Corporation and then the arguments along with the concepts of resource and capability analysis, SWOT analysis and value chain
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