Wharton on Dynamic Competitive Strategy [Paperback]

This is one of the volumes which comprise a series published by John Wiley & Sons. It was edited by George S. Day and David J. Reibstein with Robert E. Gunther. As they explain in their Introduction, "This book proposes a process for developing dynamic competitive strategies: Assess the context of competitive moves and advantages, understand the potential moves and mind-sets of competitors, formulate strategies, and test these strategies before making irreversible moves in the market." The material is carefully organized within Four Parts:

"Understanding Advantages in a Changing Competitive Environment" (Chapters 1-4): The contributors assert that any approach to competitive strategy must begin with "an understanding of the definition of arenas, sources of advantages, and the forces of change." Hence the provision of tools and insights to increase the reader's understanding of the nature of advantages and how they can change in dynamic competitive environments.

"Anticipating Competitors' Actions" (Chapters 5-9): In these chapters, the contributors rigorously examine a number of challenges from a variety of perspectives, including game theory, behavioral theory, and the view of coevolution. I especially appreciate the insights into the choices and mental models of rivals because they can help readers to anticipate competitors' responses to a given strategy. This is covered in great depth and with uncommon clarity by Venkataraman, Chen, and MacMillan in Chapter 8.

"Formulating Dynamic Competitive Strategies" (Chapters 10-14): This section examines a variety of important factors that should be considered when developing competitive strategies, including reactions, preemptions, signaling, commitment. And antitrust constraints. "While there are many other issues to consider in formulating strategy, these are among the most important considerations in developing dynamic strategies."

"Choosing Among Alternative Competitive Strategies" (Chapters 15-17): For me, the most interesting and valuable section but only because of the other three which precede it. Chapters 1-14 create a context, a frame-of-reference within which all of the essential components are identified, explained, and correlated. Now in this final section, the contributors succeed brilliantly when examining and cross-ranking alternative competitive strategies.

More a quibble than a complaint, I wish the editors had provided one more chapter, perhaps identified as "Conclusion," in which they review central themes and reiterate key points concerning the formulation and implementation of a "dynamic competitive strategy." That said, I think this volume (by no means an "easy read") will generously reward careful readers.

To George S. Day, David J. Reibstein, and Robert E. Gunther, I offer a dynamic "Bravo!"

Those who share my high regard for it are urged to check out Lawrence G. Hrebiniak's Making Strategy Work: Leading Effective Execution and Change, Michael E. Porter`s Competitive Strategy: Techniques for Analyzing Industries and Competitors and Competitive Advantage: Creating and Sustaining Superior Performance, Kellogg on Strategy: Concepts, Tools, and Frameworks for Practitioners co-authored by Daniel Dranove and Sonia Marciano, and Mastering Strategy: The Complete MBA Companion in Strategy produced by a collaboration which involved the University of Chicago, INSEAD, University of Michigan Business School, SAID Business School, and Financial Times's Editors.

Both editors are marketing professors at The Wharton School (University of Pennsylvania), which is the world's leading business school (BusinessWeek and Financial Times). George Day is well-known for his market-driven strategy, while David Reibstein is one of the leading scholars in the field of competitive marketing strategy. The book is split in 4 parts, each consisting of 3-to-5 stand-alone chapters.

Part I - Understanding Advantages in a Changing Competitive Environment - discusses competitive arenas, competitor analysis, and competitive advantage. The first two chapters expand largely on Michael Porter's (Harvard Business School) frameworks, whereby the other two chapters introduce approaches to include policy and technology trends into the strategic planning process.

The aim of Part II - Anticipating Competitors' Actions - is to get inside the heads of competitors. Chapters 5 and 6 explain the possible use of the game theory within competitive strate!gy and strategic decision making. Chapter 7 builds on these chapters to integrate the economic frame (chapter 5), the behavioral frame (chapter 6), with an coevolution frame. The final chapters of this part introduce frameworks and approaches to understanding competitor response and competitive relationships.

Part III - Formulating Dynamic Competitive Strategies - builds on the first two parts and introduces approaches to designing strategies. It introduces reactive strategies, preemptive strategies, signaling opportunities and uses, competitive positioning, and antitrust constraints (which is increasingly important to companies).

In Part IV - Choosing Among Alternative Competitive Strategies - the three chapters introduce methods and frameworks for choosing the right strategy. Chapter 15, in which conjoint analysis is combined with scenario analysis, is perhaps the most complicated chapter of the book. Part IV also introduces the possibilities to use simulation !tests for analyzing and testing strategies.

Although this book is named "Wharton on Dynamic Competitive Strategy", there are various chapters from other academic institutions. Each chapter is an excellent piece of work and can be read on a stand-alone basis. For beginners in the strategic field I recommend chapters 1 and 2 highly. The book is written in business US-English.

The book is a collection of various articles from academics. Some articles are excellent like Clemons that describes the "killer app" (although the term was not coined at the writing) principle and its relations with pricing and customer base. Most articles are well written but the treatment is MBA oriented rather that for practitionner. Also, most authors have a marketing backgroung with gives a bias toward "market oriented strategies" rather than "ressource based" , alas, in most case the truth is in the middle ...