A system dynamics approach for assessing business competitiveness
Document typeConference report
Rights accessOpen Access
The analysis of the interconnectedness between resources and capabilities, and the way organizations use them as competitive weapons have become a central element of the strategic management literature. Drawing on the resource-based view and the configuration theory, this study proposes a multidimensional competitiveness index formed by ten competitive pillars that incorporates system dynamics in the analysis. Using a unique sample of 625 Hungarian small and medium-sized firms, we empirically illustrate how the proposed index functions for managerial decision-making. Results show that the impact of competitiveness-enhancing strategies is conditional on the configuration of the businesses’ system of competencies. Low-competitive businesses benefit more from investments in the weakest competitive pillar, while strategies oriented to improve more than one competitive pillar yield higher competitiveness improvements among high-competitive businesses.
CitationLafuente, E.; Szerb László; Rideg, A. A system dynamics approach for assessing business competitiveness. A: Research in entrepreneurship and small business. "RENT 2016 : Conference final papers 2016". 2016, p. 1-25.