The Rise of Hypercompetition in the Us Manufacturing Sector, 1950 to 2002

Abstract

Recent theoretical work has posited that many industries have become hypercompetitive, characterized by volatile or transient competitive advantage. This study documents the spread of hypercompetition in the US manufacturing sector from 1950 to 2002. In so doing, the study provides careful definition of different types of competition, offers specific constructs to measure types of competition within industries, and estimates these constructs. We find a monotonic shift towards more temporary advantages as well as indicators of increasing structural instability. These results indicate a shift towards hypercompetition in most manufacturing industries, with acceleration in this transition around 1980. These findings are consistent with theoretical work about the decreasing sustainability of competitive advantage and they suggest that the field of strategy must develop new approaches for winning with a series of unsustainable advantages.

Keywords: hypercompetition, competitive advantage, structural destabilization, pervasive innovation, disequilibrium, creative destruction