Managing capabilities for strategic advantage

Abstract

Rapid change in the global competitive environment is continually challenging firms to manage their portfolio of capabilities for maximum impact. Managers are being challenged to exploit their current capabilities while nurturing the development of new ones in anticipation of emerging and future markets. The firm’s knowledge is its “key economic resource and the dominant—and perhaps even the only—source of competitive advantage” (Drucker 1999). The firm’s knowledge manifests itself in its set of strategic capabilities. The strategic management of these demands deliberate and focused effort on the part of managers; it is a task that cannot be left to chance.