5/17/2009 3:36:00 AM
Evolution of Strategic Perspectives
Great Lakes Institute of Management
A comparison between the position based view and the firm based view of strategy
Great Lakes Institute of Management
Evolution of Strategic Perspectives: A comparison between the Positioning Based View and Resource Based View Introduction
The rise of capitalism as a preferred social system in the …. lead to the emergence of the profit making enterprise. In the beginning, strong demand for goods and services ensured that each firm in the marketplace was able to sell as much as it wanted to produce. However, two events – the Great Depression of the 1930s and the Second World War (1939-1945) – that happened in quick succession, completely changed the whole competitive landscape. These two events severely dented consumer confidence and negatively impacted market demand. This period was also characterized by an exponential increase in the absolute number of market players in nearly all major business arenas. Firms slowly started realizing that they now needed to do much more than just produce goods. And their task was two fold. They not only needed to differentiate their product from that of competitors, but they also needed to convince the customer – who by this time had no dearth of options to choose from – that their offering was better than the rest. It is against this backdrop that strategic management started gaining prominence.
The Emergence of Positioning based view (PBV) as a dominant school of thought:
Even though strategic management had begun to gain prominence since the early 1950s (Oosthuizen, 2002), it was not until the 1970s that the first (organized and popularly accepted) major school of thought was established in this field. This perspective, also known as the classical view, was shaped between the late 1970s and early 1990s. In the following paragraphs we look at the major contributors to the development of this field – more popularly...