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Responding to eroding competitive advantages: observations from the Norwegian seafood industry

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This paper addresses the under-researched question of how firms cope when their competitive advantage erodes. An interpretive or cognitive view of strategy is utilised to enlighten this question. The actual research context is the fish filleting sector of the Norwegian seafood industry. The fish filleting sector has been exposed to several external threats and the majority of firms have gone bankrupt. Within the frozen fillet segment, the companies have been out-competed by producer firms in low-cost countries. Our findings reveal that it took a long time and much effort for the remaining companies to realise that their long time source of competitive advantage – access to whitefish – had eroded due to improved logistics and low transportation costs worldwide for frozen raw fish. When they finally realised this, and that their real advantage was fresh fillets – rather than frozen fillets which had been the core product of the filleting sector for more than 60 years – they faced substantial implementation problems and were only, to a very limited degree able to exploit their new source of advantage. The cognitive perspective of strategy contributes useful insights into why firms and their management struggle both to realise that advantage is deteriorating and to find and exploit new sources of advantage.
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Document Type: Research Article

Publication date: 01 September 2007

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