The Unique Bundle Of Idosyncratic Resources Commerce Essay Example

its implications in HEIs. However, there is a lack of research on the concept of competitive advantage specifically pertaining to HEIs in Pakistan. This research paper aims to examine the dynamics of core competencies within the educational sector with a focus on determining whether the core competencies identified in existing literature are applicable to educational institutions in Pakistan. The paper is structured into several sections: an introduction, a section discussing the relationship between strategy and competitive advantage, a literature review exploring resource-based view and competitive advantage, an examination of core competencies within an educational institution context, and finally concluding remarks. According to Hofer and Schendel's definition from 1978, strategy refers to aligning an organization's internal resources and capabilities with the opportunities and threats presented by its external environment.Michael Porter (1980) connected strategy with the external environment in his analysis of industry structure. Mintzberg (1985), Pettigrew (1977), and Quinn (1980) focused on the internal environment of a firm, including strategy execution and analysis of organizational processes. The term "strategy" is used at three levels: corporate strategy determines which businesses to be involved in, business strategy determines how to compete in a specific business, and functional strategy determines how a specific function contributes to the competitive advantage of the firm. Teece (1980) and Chatterjee and Wernerfelt (1991) examined the role of corporate resources in defining a firm's boundaries. At the business level, researchers studied the relationships between resources, competition, and profitability, including competitive imitation, appropriation of returns from innovations, impact of imperfect information on profitability differences, and how resource accumulation sustains competitive advantage. Pfeffer (1994) considered employees as a source of competitive advantage. Thomas et al. (2002)

argued that project managers' personal characteristics such as personality traits and experience can significantly impact project performance. Buckle (2002) emphasized the importance of aligning corporate strategy with capabilities.Gant (1991) introduced a model, entitled "The Resource-Based Theory of Competitive Advantage," which analyzes strategies. This model is based on resource-based theory and consists of five phases. The first phase involves identifying and classifying the company's resources, evaluating strengths and weaknesses compared to competitors, and finding opportunities for better resource utilization. The second phase focuses on identifying the company's capabilities, actions that it can perform more effectively than rivals. It also involves identifying the resources needed for each capability and assessing their complexity. The third phase evaluates the potential of resources and capabilities to generate rents, sustainable competitive advantage, and appropriability of returns. The fourth phase includes selecting a strategy that maximizes the use of company resources and capabilities in relation to external opportunities. The final phase emphasizes identifying any resource gaps that need filling and investing in replenishing, expanding, and upgrading the company's resource base.

III - COMPETITIVE ADVANTAGE

Resource-based position and Competitive Advantage:

The work by Prahalad and Hamel (1990) initiated discussions on the concept of "core competency." This concept is derived from the resource-based view (RBV) of the firm.The RBV theory, which is based on the works of Penrose (1959) and Wernerfelt (1984), emphasizes that competitive advantage comes from a firm's unique and difficult to imitate skills, knowledge, resources, and capabilities (Wernerfelt, 1984; Rumelt, 1984). According to RBV, these resources and capabilities not only form the foundation for a firm's strategy but also serve as its main source of profit (Grant, 1991). Furthermore, they have an impact on

a firm's growth and performance (Penrose, 1959; Barney, 1991; Mahoney and Pandian, 1992). By explaining how a firm can achieve differentiation and sustainable competitive advantage (Hoskisson et al., 1999), RBV has gained significant attention in the fields of strategic management, economics, and organization theory (Galbreath.2005).

Grant (1991) was the first to utilize Resource-Based View as a theory. He argued that strategy should be aligned with both internal resources and skills of an organization as well as external opportunities and risks. A firm's resources encompass all tangible and intangible assets it possesses or controls - including human/non-human assets - that enable value-enhancing strategies to be created and exploited(Barney ,1991; Wernerfelt ,1984).

Furthermore Grant(1991) criticized the sole focus on aligning strategy with external environment during the '80s strategic analysis period.RBV, or Resource-Based View, is a management theory that focuses on both internal and external analysis (Collis and Montgomery, 1995). In its early days, RBV was established by contributions from Wernerfelt (1984), Barney (1986), Dierickx and Cool (1989), and Peteraf (1993). Barney (1991) proposed a framework suggesting that sustainable competitive advantage comes from a firm's valuable, rare, imperfectly imitable, and substitutable resources. Lei, Hitt, and Bettis (1996) defined core competencies as problem-defining and problem-solving insights that lead to a firm's competitive advantage. This unique knowledge is derived from "unique cognition" which is difficult for others to replicate without following the same learning path and making irreversible investments (Barney, 1991). The selection, development, deployment, and protection of these core competencies vary among firms resulting in differences in performance (Hamel, 1994). Possessing core competencies alone is not enough; the ability to leverage them for the benefit of the firm is crucial according

to Prahalad and Hamel's concept of strategic architecture in attaining sustainable competitive advantage (Prahalad & Hamel 1990).Hamel (1994) provided an explanation of the hierarchy and distinctions between meta-competencies, core competencies, and component skills. According to Hamel (1994), understanding this hierarchy is essential for differentiating between levels of competences. The ability of a house to successfully manage its hierarchy of competences in order to achieve sustainable competitive advantage is referred to as critical competency (Srivastava, 2005). Managers must invest time, effort, and resources in developing the ability to manage both meta and core competences in order to attain sustainable competitive advantage (Srivastava, 2005). While firms may have different competences, their critical competency is universal (Srivastava, 2005). Srivastava's (2005) critical model offers a comprehensive framework for understanding competences within a firm. This model emphasizes the importance of continuously upgrading or abandoning core competences based on internal and external environments when designing the firm's strategic architecture on an enterprise-wide scale.According to Barney (1991), the competences pool refers to all assets, capabilities, organizational processes, attributes, information, knowledge, etc., that fall within the realm of a firm's resources. Bogaert, Martens, and Cauwenbergh (1994) further categorized these resources into three groups: physical capital, human capital, and organization capital. Hall (1992) emphasizes the difference between assets (which represent resources) and skills or competences (which represent the creation of resources). Srivastava (2005) states that each organization possesses its own set of 'doing' resources which include both useful and not so useful capabilities that make up the company's competence pool. The company may add new competencies over time while removing excess ones from the pool. Additionally, dormant competencies can be utilized when needed. Constantly

improving the package of competences is crucial for gaining a competitive advantage. According to Barney (1991), not all resources in a company are strategically relevant; only those with potential for sustainable competitive advantage are considered strategic assets. These strategic assets are valuable and scarce because they are difficult to trade or imitate as suggested by Amit and Schoemaker (1993) and Barney (1991). Hamel (1994) suggests that a company typically has around 10-15 core competences along with a few meta-competencies.The organization has an advantage over its competitors due to its unique competences (Hall, 1992). Both core and meta competencies should provide superior customer value according to Srivastava (2005), who also proposed that identifying meta-competencies makes them easier to manage. The process of 'competencies enlightenment' guides the company's future strategy. Hamel (1994) argued that companies usually possess only a few generic meta-competencies. By identifying and strategically placing meta-competencies within the organization, resources can be focused more effectively. Successful houses ensure that their competences align with internal and external environments to avoid conflicts. It is crucial for successful houses to not only know how to deploy their core competencies but also understand that these competencies are dynamic and can be improved through application and sharing. Nurturing core competencies is vital for organizational success as they may deteriorate if not fostered over time. Constant monitoring of strategic stocks is necessary to prevent erosion, while non-core competencies should not waste resources. Organizational culture and architecture should support the development of core competences, with the design of a house's organizational architecture aiming at supporting desired core competences (Srivastava, 2005).According to Lippman and Rumelt (1982), firms often try to imitate successful organizations.

In order for organizations to maintain a competitive advantage, it is crucial for them to continuously learn and enhance their core competences. If they fail to do so, other organizations may copy their competences and erode their competitive advantage. Therefore, Helleloid and Simon (1994) suggest that firms should continuously invest in and upgrade their core competences for sustained competitive advantage.

Firms have several options for upgrading or acquiring new competences, including internal development, market procurement, inter-firm collaboration, or mergers and acquisitions. However, Prahalad and Hamel (1990) caution that some competences may become obsolete over time and no longer provide sufficient value. In these cases, organizations should abandon these competences.

It is important for managers to be aware that core competences can easily become "core rigidities" (Leonard-Barton, 1992). O'Driscoll et al. (2001) advise firms to be sensitive to both internal and external factors in order to avoid falling into a "competence trap". Directors must also exercise caution when considering abandoning a core competence without sufficient consideration since fostering a competence requires significant resources. Rebuilding a core competence from scratch would not only be very expensive but also potentially nearly impossible to achieve.

Dynamics of Core Competence

According to Prahalad and Hamel (1990), a core competency possesses three characteristics. It contributes to perceived customer benefits, is difficult for competitors to imitate, and can be utilized by an organization to influence a wide range of markets. Quinn and Hilmer (1994) suggest that companies should focus on their core competencies and outsource other activities. This approach not only maximizes returns by concentrating on what a company does best and creating significant barriers to entry for competitors, but also allows for optimal

utilization of external supplier strengths and investments and reduces investment and risk, shortens cycle times, and increases customer responsiveness.

Mascarenhas, Baveja, and Jamil (1998) conducted case studies of 12 multinational companies to analyze the dynamics of core competencies. The selected companies were leaders in the global marketplace and were characterized by their high levels of profitability, longevity, or low top management turnover. The text highlights the representation of various houses from different industries, ranging from manufacturing to the service sector and from industrial to consumer products. These firms are based in Germany, India, Japan, and the United States.

The competencies identified by these firms are categorized into three classes: dependable procedures, superior technological know-how,and close relationships with external parties.Superior Technological Know-how encompasses a deep understanding of a particular subject or field. This understanding can be gained through early and continuous involvement, as well as significant engagement in that area. It entails knowledge about scientific properties, inter-relationships, and the latest advancements specific to that domain. Companies can gain an advantage by leveraging this knowledge if their competitors lack a similar foundation.

Additionally, if this expertise is used to create superior products for customers, it becomes even more valuable. Reliable Procedures involve delivering expected outcomes quickly, consistently, and efficiently while minimizing disruptions or inconveniences for customers. These procedures may include processes like decomposition, re-integration, skill transfer across functions or locations (including different currencies or countries), and the ability to customize products based on customer requirements using various inputs.

Examples of such procedures include research and development activities, zero-defect manufacturing practices, obtaining regulatory approvals, international sourcing strategies, efficient execution of cross-border transactions, as well as the successful transfer of operating systems or

organizational cultures internationally or within acquired organizations.

Implementing these procedures can provide numerous benefits to companies including fostering strong external relationships with suppliers, regulators professional organizations distributors ,and customers alike.Developing strong external relationships with entities such as suppliers, distributors, professional organizations, and customers can lead to mutual benefits. For instance, suppliers can contribute ideas for new product development or quickly make design changes in parts. Distributors provide access to market opportunities and customer information, while professional organizations offer top talent. Customers may propose new competencies for the company to develop.

As Kay (1993) and Lynch & Baines (2004) explain, reputation and advanced capability are recognized as competitive resources for universities. To attract students to their courses, it is crucial for universities to establish long-term relationships with them. This ensures ongoing engagement with the institution throughout their lives as employees, donors, or partners.

A university's reputation allows it to effectively communicate positive information about itself to stakeholders. It also supports outreach activities and attracts commercial and public patrons of research. The reputation of a university plays a significant role in gaining a long-term competitive advantage since students often choose classes based on the perceived expertise and reputation of teaching staff (Hughes, 1988; Moore, 1989).

Key factors that enable universities to achieve competitive advantage include having an image of providing quality education, maintaining a strong market profile, and establishing offshore learning operations through collaborations with international partners (Mazzarol & Soutar , 1999).Researchers such as Fram & Lau (1996), Thomas (2001), and Harley (2002) have highlighted the significance of research in establishing a university's reputation. Invention capability refers to the capacity for undertaking novel initiatives that surpass current strategies. According to Lynch

and Baines (2004), developing invention capability is particularly challenging in higher education institutions as it requires maintaining quality while upholding academic standards. This capability applies to learning, research, and outreach/commercialization activities, including the development of new courses, e-learning, patents, and new commercial products/services (Kay, 1993; Taylor, 2002).

Evaluation of Competencies in the Educational Sector - Case of Gift University, Pakistan:

Located in Gujranwala, Punjab, Pakistan, Gift University had its groundbreaking ceremony performed by Haji Aziz-ur-Rehman on August 11, 2001. The establishment of GIFT University was announced on July 1, 2002. Admission to various Master and Bachelor degree programs began in fields such as Computer Science, Business and Commerce Management Sciences Arts & Social Sciences. Honorable Lt.Gen.(R) Khalid Maqbool inaugurated the university on September 30th ,2002., and its first semester commenced on October 17th ,2002.The acronym GIFT represents Gujranwala Institute of Future Technologies.
The GIFT UNIVERSITY GUJRANWALA ACT 2004, ACT XIV of 2004, granted a charter by the Punjab Assembly, making it the sole chartered university between Lahore and Islamabad at that time. It is a pioneering institution in Pakistan, offering a four-year bachelor's program of international standards. The university has gained national recognition with students from three countries and 18 cities. Recently, it became an approved ETS center in Pakistan, joining Lahore, Karachi, and Islamabad as one of the four cities to offer online TOEFL examinations. Currently, the university provides four-year Bachelors with Awards programs in Accounting & Finance, Business Administration, Computer Science, and Textile & Fashion Design. At the Masters level, it offers programs in Accounting & Finance; Business Administration; and English Language & Literature. From inception, the university prioritizes its career-oriented curriculum to address contemporary

challenges while providing practical training across industries to broaden horizons and enhance skills for students. The highly educated faculty members bring extensive backgrounds and experiences to enrich student learning experiences. With a steady growth rate of 30% each year, the university produces highly qualified professionals who assume leadership roles within organizations both domestically and internationally in Pakistan.The methodology utilized in this study encompasses analyzing the core competencies of GIFT University, an educational and training institution. The research involved interviewing top executives who possess knowledge about the institution's business practices. These executives were given a general definition of nucleus competency and asked to provide insights on the university's stance regarding it. To verify the information provided by the executives, observation and various documents such as newsletters, newspapers, company reports, brochures, and the company's website were consulted. The requested information encompassed aspects such as organizational history, human resources, sales and marketing functions, in-house R&D, global affiliation, technology acceptance and implementation, etc. Subsequently, the accuracy of their reporting was confirmed through follow-up communication with the executives to allow for any desired modifications. GIFT University places great importance on establishing strong external relationships and actively invites guest speakers from both industry sectors and other universities to participate in its activities. It maintains robust connections with Chambers of Commerce and Industry located in Gujwanala, Sialkot, and Gujrat. Additionally,GIFT involves not only principals and vice principals from regional educational institutions but also senior management personnel from leading industries in its gatherings and events.Professionals from different industries serve as members of each department's board of studies at GIFT University.The Career Development Office plays a crucial role in connecting recent graduates with potential

employers.The alumni association of GIFT University helps recent graduates find jobs. GIFT has established strong connections with Gujranwala and Sialkot Banker's nines. The module's consultancy function aids the regional industry in acquiring up-to-date knowledge and expertise. Faculty members from GIFT University often serve as guest lecturers. GIFT's marketing efforts have gained coverage in national newspapers. Reliable procedures have been developed by GIFT in education and training. Senior faculty members create course outlines for the curriculum, which are approved by the board of studies consisting of GIFT University faculty, professionals, and a member from the Higher Education Commission of Pakistan. Department heads monitor these course outlines for content and coverage. Final exam papers are handled confidentially after being submitted in advance. Quizzes, assignments, projects, and other evaluations are kept to ensure consistency and assess severity. The new module hiring process at GIFT University is formal and involves a structured presentation to current module members in relevant sections.GIFT University has a dedicated office for class registration and timetable management.To meet the HEC requirement of 37.5 contact hours, module members must sign the class log-in registry to ensure timely attendance.If a module member misses a class, they must make it up within the same or following weekGIFT University has created a helpful resource called the "Instructor's Semester Checklist" to assist module members in completing all necessary tasks before, during, and after a semester. Additionally, module members support each other by attending each other's classes to improve instruction. The university also offers an online feedback system where students can provide input on teaching and various facilities such as the cafeteria, transportation, resource center, computing facilities, student affairs, and library.

These reliable systems contribute to GIFT University's favorable HEC rankings and international partnerships.

GIFT University in Gujranwala is widely recognized for its exceptional technological capabilities. It has a substantial number of on-campus PhDs, which sets it apart as having the highest concentration of such faculty members in the region. Many of these faculty members have gained international experience, further bolstering the university's expertise. In addition to this expertise, GIFT University organizes workshops aimed at developing its faculty members' skills. For instance, they offer workshops like Participant Centered Learning and Case Based Method that are modeled after Harvard Business School's teaching resources and led by faculty from Lahore School of Management Sciences. They also conduct an English Language class taught by Berlitz International. Moreover, GIFT University has invested significantly in automating internal processes through their own software system called Softshake.Approximately 75% of instructional materials and around 85% of administrative records are stored in the computer system at GIFT University. They utilize a customized software called GIFT Education System, developed by Softshake, to assist students with various tasks like course enrollment, add/drop requests, and checking final results. This system can be accessed both on and off campus. Additionally, GIFT University showcases their technologically advanced approach through other applications such as Employee Attendance software, GIFT transportation system, online recruitment application for new employees, online complaint system, and online requests from prospective students.

Around 65% of external communication is conducted via email while internal communication relies on Microsoft Exchange Server for approximately 85% of interactions.

GIFT University has remained committed to providing high-quality education since its establishment. Their vision is to bring about significant change in society by becoming a leading educational

and research institution that utilizes the latest technology. They aim to offer intellectually stimulating, professionally relevant, progressive, and advanced education aligned with national values that is accessible to all. The university's MBA program stands out for its real-life case-based curriculum and they also have a strong MSc program in Accounting and Finance. As a result of their excellent offerings, GIFT University attracts students not only from Gujranwala but also from other cities.GIFT University stands out as the pioneer in the region for providing a four-year awards program in accounting and finance, as well as business administration at the undergraduate level. Notably, it is also the sole institution in Gujranwala offering a Bachelor's degree in fine arts and design. The university's esteemed faculty and exceptional programs have made it highly favored by employers in the area. Numerous faculty members have contributed to academia through publishing case studies, research articles, and presenting conference papers on both national and international platforms. Additionally, several faculty members actively engage in consultancy assignments.