Case Study: The Spanish Wine Industry
This scholarly article assesses the elements of competitive advantage in the Spanish wine industry. Strategy, resources, capability, and managerial ability all affect a firm's competitive advantage.
Hypotheses
Managerial capabilities
The importance of managerial
capabilities is based on the manager's vision and leadership. The
success of the firm will depend on its effectiveness, along with the
skills and knowledge of people working in the organization, who establish priorities and belief systems, and guide managers
and employees towards the shaping of business resources and competencies.
As part of the management competencies,
the definition of organizational structure and corporate strategy are
included, both in terms of design and implementation. Management skills
allow for the identification of the basic competences, communication to
the employees and the employees accepting these basic competences.
Managers must provide a high degree of commitment, clear definition of
objectives and adequate financial resources.
The
relationship between management capabilities and competitive advantage
is based on the successful guidance of managers implementing cost
reduction, product differentiation or a combination of both. Other key factors include the strategic vision of the
business and the internal communication: strategic management of human
resources, which includes recruitment, job analysis, development,
training, performance and compensation, and finally in the acquisition,
development and use of organizational resources, the conversion of these
resources into valuable products and services, and the delivery of
value to partners and owners of the company. This set of managerial
capabilities can become a generator of appropriable incomes and a source
of maintenance of competitive advantage. It
also helps explain the relationship between strategic decisions and
business performance.
The study of
managerial capabilities and their relation with the firm's performance
has been analyzed in many studies, finding a positively correlated link. So that
according to this, the authors propose the following hypothesis:
H2
In the wine sector, the management capabilities owned by the firm are positively related to the firm's performance.