A financial management firm has existed for over 70 years. Some of its original clients' grandchildren are now clients of the firm themselves. The partners and staff of the firm have spent most or all of their careers with the firm. Many have even married into each other's families. This firm has capabilities that would be costly to imitate because of its
A) access to large amounts of financial capital.
B) possession of causally ambiguous core competencies.
C) social complexity.
D) unique historical conditions.

Question

Quizplus · Accepted Answer

The social complexity of the firm, characterized by the long tenure of its partners and staff and the intermarriage of some of its members, makes it difficult for competitors to replicate its knowledge and relationships. This factor provides a sustainable competitive advantage that would be costly to imitate. The possession of causally ambiguous core competencies is also a possibility, but the provided information does not allow us to conclude this definitively. The access to large amounts of financial capital and unique historical conditions are not mentioned and are therefore unlikely to be relevant in this case.

A Financial Management Firm Has Existed for Over 70 Years