Final answer:
Sustainable competitive advantage can be influenced by a company's financial resources, unique offerings, and cost management. Innovation is crucial for maintaining an edge, but frequent leadership changes may not contribute positively. Having a strong brand, the ability to manage costs, and operating in a market with reduced competition are all benefits to sustaining an advantage.
Step-by-step explanation:
Sustainable competitive advantage is influenced by factors such as strong financial resources, unique products or services, and effective cost management. For instance, a company that has established a well-respected brand name over many years is likely to enjoy a competitive advantage because brand recognition can influence consumer behavior and create loyalty. Additionally, companies that can produce products more cheaply or with desirable characteristics can maintain a competitive edge through innovation. Gregory Lee, CEO of Samsung, highlights the importance of innovation in sustaining a competitive advantage by enabling consumers to discover new possibilities with technology, thereby earning above-normal profits before competition catches up.
Frequent changes in leadership, however, are not commonly associated with a sustainable competitive advantage, as they can lead to instability and a lack of clear strategic direction. Instead, firms often benefit from a well-established reputation for slashing prices in response to new entries into the market, which can deter competition. Furthermore, certain market structures like a monopoly can allow for greater control over prices and reduced competition, furthering a firm's competitive advantage.