Measuring competitive advantage for corrective action and growth among listed companies in Zimbabwe

Abstract

Zimbabwe stock exchange listed companies are losing significant market share to foreign companies due to inability to sustain competitive advantage, what strategy or position to take – defensive or offensive? This loss of competitive advantage is negatively impacting these companies’ capacity utilization, market share, shareholder value and financial performance and at country level reducing contribution to gross domestic product and loss of employment. Despite there being traditional models/frameworks to assist companies with gaining and sustaining competitive advantage, they are falling short given the turbulent business environment. This quickens the urgent need to explore and develop new frameworks to copy with dynamism in the business environment obtaining in Zimbabwe. In this research, three competitive advantage theories namely five forces model, generic strategies and the resources-based theory were used in combination to come up with the conceptual framework to answer the research question. The aim was to identify key indicators that give companies pointers/ indicators on whether they are losing or gaining competitive advantage so that they can progress their objectives continuously. The study focused on Zimbabwe stock exchange listed companies. A mixed methods design was used following a concurrent variant. Quantitatively, a survey was used to collect data from fifty companies listed on the Zimbabwe stock exchange. Qualitatively, a multi-case study was used to collect data through interviews from academics and industry leaders. A parallel database variant was used, and the results merged. The objective was to critique and get an in depth understanding of key indicators that can alert companies on whether they are gaining or losing competitive advantage. The results showed that competitive advantage is no longer permanent given disruptions, thus creation of competitive advantages should be a continuous process. The contribution to the community of practice was identifying the key indicators that will show the status of a competitive advantage, and subsequently developed an economic dashboard which gives companies pointers/ indicators on whether they are losing or gaining competitive advantage so that they can progress their objectives continuously. The rational being that companies must detect early and measure the impact of activities in the business environment to reconfigure their competitive advantage or even better develop other advantages to meet and exceed customer needs. Future research needs to focus on using digital to gain and sustain competitive advantage, the role of entrepreneur in gaining and maintaining competitive advantage and managing competitive advantage using its life cycle needs further research.