Strategic commitments tend to change the competitive playing field.

Question

Quizplus · Accepted Answer

Strategic commitments are decisions made by firms to invest in certain capabilities, resources or activities that will help them gain a competitive advantage over their rivals. These commitments can have a significant impact on the competitive playing field by changing the balance of power between firms and altering the rules of competition. For example, if a company decides to make a large investment in research and development to create a new technology, it could disrupt the existing market and force competitors to respond with their own innovations. Similarly, if a firm commits to a long-term contract with a key supplier, it could limit the options of its rivals and give it an advantage in pricing or product quality. Thus, strategic commitments can have far-reaching consequences for the industry and the firms involved.

Strategic Commitments Tend to Change the Competitive Playing Field