Final answer:
The building block of competitive advantage is innovation.
Step-by-step explanation:
Competitive advantage refers to the unique strengths or capabilities that allow a business to outperform its rivals in the marketplace. It is the strategic advantage that enables a company to achieve superior performance relative to its competitors, leading to increased market share, profitability, and sustained success. Competitive advantage can arise from various factors, and businesses often strive to identify, develop, and leverage these advantages to stay ahead in the competitive landscape
The building block of competitive advantage is innovation. Innovation allows a firm to create new products or improve existing ones, giving them a temporary edge over competitors and the ability to earn above-normal profits. Cost leadership and differentiation are strategies that can be used to achieve competitive advantage, but they are not the building blocks themselves.