Final answer:
Building layers of advantage, searching for loose bricks, changing the rules of competitive engagement, and collaborating are components of Hamel and Prahalad's framework for competitive innovation. This strategy encompasses the ongoing pursuit of innovation, leveraging temporary competitive edges for above-normal profits, and adapting to changes in comparative advantages within the global market.
Step-by-step explanation:
The elements of building layers of advantage, searching for loose bricks, changing the rules of competitive engagement, and collaborating are part of Hamel and Prahalad's framework for competitive innovation. This is a strategy that embraces the continuous pursuit of new innovation which in turn can lead to above-normal profits by providing a firm with a competitive edge that is often temporary as competitors attempt to catch up. This innovation-driven approach is critical for any firm looking to stay ahead in a crowded market where consumer preferences, technology, and competitive landscapes are in constant flux.
For example, by building layers of advantage, a company steadily enhances its strengths in a cumulative fashion. Searching for loose bricks entails identifying opportunities or weaknesses in the competitive environment that can be exploited. Changing the rules of competitive engagement involves redefining terms of competition to the firm's advantage, while collaborating can lead to synergies and partnerships that bolster a company's position. The relentless pursuit of innovation, as exemplified by Samsung's CEO Gregory Lee's philosophy, underpins this framework by focusing on the creation of products with desirable characteristics or finding ways to produce goods more efficiently.
Additionally, in today's global economy, where intra-industry trade is common, a firm's comparative advantage can be influenced by many factors, such as specialized skills, economies of scale, and the knowledge base of its workforce. It is important for countries and companies alike to remain flexible and adapt to ongoing changes in their comparative advantages to maintain competitive innovation.