Explaining sustainable competitive advantage for banks in Gilan province in the form of a causal model

Academic Thesis for Master's Degree

Field: Business Management, Major: Marketing

Abstract

The current era cannot be compared with any of the past eras. The dominant feature of this era is knowledge-oriented, information-oriented and high rate of changes in various fields. This is the truth that covers the business environment and shows the increasing complexity of global markets and the dynamics of the environment facing companies and manufacturing and service institutions. Organizations have no other choice but to gain and use competitive advantage in order to remain immune from environmental forces and adapt to competitive requirements. Therefore, competitive advantage is an issue that all organizations active in the market must pay attention to. In the modern economy, the production of wealth and economic growth mainly originates from intangible assets, especially intellectual capital. Accordingly, for a country like Iran, which in its 20-year vision document intends to compete with its neighbors in the economy and trade, the knowledge-based economy should be considered a strategic tool. One of the activities that must be done in order to realize a knowledge-based economy is to pay attention to the country's banking system. In addition, today leading banks try to increase their profitability by satisfying the most important factors for customers in the best possible way. But many banks have neglected the practical methods of marketing their services. In today's business market, only organizations that have aligned themselves with these changes can remain competitive. Banks replace traditional branch functions with new methods for two reasons: First: branch establishment and maintenance due to its high overhead cost. Secondly: Technology and innovation are considered a kind of differentiation and competitive advantage for banks. Therefore, this research is focused on explaining the sustainable competitive advantage in the banking system. Different studies show that the variables of intellectual capital, entrepreneurship and capabilities can be effective in creating competitive advantage, which are considered as independent variables in this research. The model of this research is designed based on the models of Lee and Hsieh (2010), Battani and Al-Zawabi (2011), Zernler et al. (2008) and Michalski et al. (2008). The aspect of innovation in this research is to explain the competitive advantage of banks in Gilan province. Competitive advantage is based on the structures of quality, time and cost, intellectual capital is based on the structures of structural, human and customer capital, entrepreneurship is based on the structures of pioneering, innovation and risk-taking, capabilities are based on the structures of innovation and marketing. The general purpose of this research is to design and test the causal model to explain the sustainable competitive advantage in the banks of Gilan province. The statistical population of this research is private and public banks in Gilan province in the summer of 2012. Sampling was done using a random method. The sample size was determined to be 170. The method of this research is practical in terms of purpose and descriptive in terms of data collection. The method of collecting data and information is field, as well as the tool of data collection is a standard questionnaire. The data analysis method was structural equation modeling using Lisrel software. Finally, by testing the hypotheses, the analysis results show that there is a positive relationship between competitive advantage and entrepreneurship, capabilities and intellectual capital. There is also a positive relationship between intellectual capital and entrepreneurship, intellectual capital and capabilities, entrepreneurship and capabilities. Key words: competitive advantage, intellectual capital, entrepreneurship, capabilities, structural equation modeling. So that it creates a competitive advantage [1] for them. Gaining a competitive advantage is not achieved randomly and without a plan, but organizations should move in this direction by thinking and designing scientific frameworks. Outstanding products, advanced technology and the like, if they are not effective in creating a competitive advantage, they will not have any effect on the company's success (Hamidi, 2007, pp. 6-7). With these explanations, it can be said that the concept of competitive advantage is the ability of companies to attract the opinion of customers compared to competitors by relying on the capabilities and capacities of the organization so that competitors are not able to realize these values ??and create alternatives for it at the same time (Momeni, 2018, p. 80). This advantage can exist in any of the elements of the marketing mix[2]..

The idea of ??sustainable competitive advantage emerged in 1984 when it was shown that different types of strategies help create competitive advantage. The real explanation of competitive advantage was expressed in 1985 by Porter[3], who said that various types of competitive strategies of companies, which include concentration, differentiation and low cost, will lead to the creation of a sustainable competitive advantage. Although the old sources of competitive advantage such as production capacities, laboratories, access to financial resources, distribution channels or economies of scale are necessary, but today they are not sufficient for success in the business world (Masoumi, 2010, p. 128). For example, the issue of intellectual capital has become one of the basic and central issues in today's organizations, and organizations must identify and evaluate these assets in order to achieve greater productivity[4] and maintain and survive (Rafiei, 2010, pp. 125-123).

Changes in the external environment of organizations, especially banks, such as the increasing growth of science and technology, globalization, deregulation, and the entry of financial institutions The new has also caused the banking industry to become very competitive. Banks, as continuing institutions of financial services, have turned to a customer-oriented system [5] and not a product-oriented one [6]. Innovation is defined as the use of knowledge to provide a new product or service that is demanded by customers. (Fakour, 1387, p. 39). Therefore, it is necessary to pay attention to organizational innovation as a distinctive key competence of the organization in order to secure and guarantee competitive advantage (Aqighi, 2015, p. 3). Today, the trend towards entrepreneurship is one of the new strategies in organizations in order to provide the conditions for effective entry of banks into the entrepreneurship process by strengthening innovation, initiative and risk-taking. Despite this, the services of the country's banking system do not have the necessary diversity, quality and speed, and it faces inefficiency in the process of resource allocation and allocation as well as customer service. To solve the problems of the banking system, creating suitable platforms and fields for increasing entrepreneurship [7] can be an effective model for achieving innovation, offering new products and finally, improving the quality of services. Therefore, this research is focused on explaining the sustainable competitive advantage in the banking system. 1 2) Statement of the problem The current era cannot be compared to any of the past eras. The dominant feature of this era is knowledge-based[8] which includes central information[9] and a high rate of changes in various fields. This is a fact that covers the business environment [10] and shows the increasing complexity of global markets [11] and the dynamism of the environment facing companies and manufacturing and service institutions (Bagheri, 2011, p. 5). Organizations have no choice but to acquire and use competitive advantage [13] in order to remain immune from environmental forces [12] and to adapt to competitive requirements. Therefore, competitive advantage is an issue that all organizations active in the market should pay attention to. Competitive advantage is a factor with which an organization is able to create a defensive or offensive situation against its competitors and includes capabilities [14] that allow an organization to differentiate itself from its competitors (Li et al, 2006, p111). Porter [15] believes that competitive advantage is realized through creating value for customers, and value is also manifested by providing goods and services that are distinct [16] from competitors and at a lower cost [17]. Bagheri, 1391, p.5). Examining the situation of Iranian companies shows that the low competitive advantage has caused them to lag behind in the competitive environment, and this problem is expanding day by day. Considering the competitive structure in various industries, companies should strive to strengthen their competitive position and design strategies that will give them a competitive advantage. Until the early 1950s, the main reason for the backwardness and lack of advantage in developing countries was mainly the lack of financial and physical capital. In the modern economy, the production of wealth and economic growth mainly originates from intangible assets, especially intellectual capital [18]. Accordingly, for a country like Iran, which in its 20-year vision document intends to steal competition from its neighbors in economy and trade, the knowledge-based economy [19] should be considered as a strategic tool. One of the activities that must be done in order to realize a knowledge-based economy is to pay attention to the country's banking system. One of the shortcomings of the country's banking system is the government structure and its huge size, which has caused non-financial indicators, especially intellectual capital, to be neglected.