aem120-9-12 - 9/12 Chapter 10: Understanding and Protecting...

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9/12 – Chapter 10: Understanding and Protecting Competitive Advantage Defining competitive advantage Protecting competitive advantage Protecting unique information The typical entrepreneurial effort o Last less than three years o Never generates a profit o Is abandoned (or ends in bankruptcy) A firm is said to have a sustained competitive advantage when it is implementing a value creating strategy not simultaneously being implemented by any current or potential competitors and when these other firms are unable to duplicate the benefits of this strategy An enterprise has a Competitive Advantage if it is able to create more economic value than the marginal (breakeven) competitor in its product market. The Economic Value created by an enterprise in the course of providing a good or service is the difference between the perceived benefits gained by the purchasers of the good and the economic cost to the enterprise. Precludes others from imitating the business idea perfectly
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aem120-9-12 - 9/12 Chapter 10: Understanding and Protecting...

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