Book excerpt: Excerpt from Untangling the Origins of Competitive Advantage For example, from an environmental perspective, the pharmaceutical industry has historically been a profitable because buyers and suppliers are weak, entry is costly and difficult, and substitutes and rivalry are quite muted. At least in part, this structure reflects external forces, such as the fact that the industry's products can be securely protected through patents, and so is not the result of a specific organizational competence on the part of a particular firm. But the industry's attractiveness also reflects the unique competencies developed by the larger pharmaceutical firms, including, among other factors, their years of investment in sophisticated research capabilities, their knowledge of regulatory systems around the world, and their extensive distribution and physician networks.organizations are fundamentally different from each other for reasons that may have very little to do with any kind of strategic logic, and that they can only change through limited, local search. To the extent that competencies are built on organizational routines that are only tacitly understood indeed if tacit understanding and complexity are a prerequisite for any competence to be a source of competitive advantage then there may exist a fundamental tension between the fact that competencies lie at the heart of competitive advantage and the use of this insight_to guide strategy choice (leonard-barton, From this perspective, the simple observation that competencies may lead to advantage is only half the battle: the other half is understanding where competencies come from. About the Publisher Forgotten Books publishes hundreds of thousands of rare and classic books. Find more at www.forgottenbooks.com This book is a reproduction of an important historical work. Forgotten Books uses state-of-the-art technology to digitally reconstruct the work, preserving the original format whilst repairing imperfections present in the aged copy. In rare cases, an imperfection in the original, such as a blemish or missing page, may be replicated in our edition. We do, however, repair the vast majority of imperfections successfully; any imperfections that remain are intentionally left to preserve the state of such historical works.