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Competitive Advantage vs Distinctive Capability

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A competitive advantage is a business position, structure, strategy, capability, process or design that is superior to all competition.
A distinctive capability a valuable business capability that all competition can't duplicate.

The Difference

Competitive advantage is a broad term that applies to anything that gives a firm an advantage over the competition. This can include economic advantages, relationships, processes and know-how.
A distinctive capability is a competitive advantage that is based on a business capability such as innovation, marketing or design.


Competitive advantage includes things such as political connections and economic advantages that are positions as opposed to operational capabilities. For example, a hotel that has the only beachfront property available on a popular beach may be able to charge higher prices and maintain a higher occupancy rate than all other hotels in a particular resort area. The hotel may have mediocre business capabilities in areas such as customer service but their position is firm nonetheless.
A distinctive capability applies to things that a particular firm does better than all other competition that the competition find impossible to replicate. For example, a firm that consistently innovates faster than the competition to produce superior products.
Competitive Advantage vs Distinctive Capability
Competitive Advantage
Distinctive Capability
A superior position or business capability that gives a firm an advantage over the competition.
A superior business capability that competition find impossible to duplicate over an extended period of time.

Competitive Advantage

This is the complete list of articles we have written about competitive advantage.
Absolute Advantage
Bargaining Power
Barriers To Entry
Business Cluster
Business Scale
Business Strengths
Competitive Differentiation
Competitive Parity
Competitive Pressure
Cost Advantage
Cost Innovation
Cost Strategy
Critical Mass
Customer Satisfaction
Digital Maturity
Distinctive Capability
Economic Advantage
Economies Of Density
Economies Of Scale
Economies Of Scope
Experience Economy
Information Advantage
Information Asymmetry
Market Position
Market Power
More With Less
Network Effect
Organizational Culture
Price Leadership
Product Development
Relational Capital
Relative Advantage
Risk Management
Strategic Advantage
Switching Barriers
Switching Costs
Trade Secrets
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Competitive Advantage

A few sources of competitive advantage for businesses.

Competitive Parity vs Competitive Advantage

The difference between competitive parity and competitive advantage.

Competitive Advantage

A few sources of competitive advantage for businesses.

First-Mover Advantage

Why being first to a market has advantages.

Competitive Benchmarking

A definition of competitive benchmarking with examples.

Digital Maturity

The common types of digital maturity.

Business Scale

The common types of business scale.

Business Competition

The common types of business competition.


The common types of marketability.

Competitive Map

A definition of competitive map with examples.

Business Capabilities

A few examples of business capabilities.

Business Capability Definition

An organization ability.

Capability Management

A definition of capability management with an example.

Distinctive Capability

A definition of distinctive capability with a few examples.

Functional Benchmarking

A definition of functional benchmarking with examples.

Capability vs Ability

The difference between ability and capability explained.

Company Capabilities

An overview of company capabilities with examples.
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