Read the
following passage carefully and answer the following questions:
In terms of labour, for decades the relatively
low cost and high quality of Japanese workers conferred considerable
competitive advantage across numerous durable goods and consumer-electronics
industries (eg. Machinery, automobiles, televisions, radios). Then labour-based
advantages shifted to South Korea ,
then to Malaysia , Mexico and
other nations. Today, China
appears to be capitalizing best on the basic of labour, Japanese firms still
remain competitive in markets for such durable goods, electronics and other
products, but the labour force is no longer sufficient for competitive
advantage over manufacturers in other industrializing nations. Such shifting of
labour-based advantage is clearly not limited to manufacturing industries.
Today a huge number of IT and service jobs are moving from Europe and North
America to India, Singapore, and like countries with relatively well-educated,
low-cost workforces possessing technical skills. However, as educational levels
and technical skills continue to rise in other countries, India , Singapore and like nations enjoying
labour-based competitive advantage today are likely to find such advantage
cannot be sustained through emergence of new competitors.
In terms of capital, for centuries the days of
gold coin and later even paper money restricted financial flows. Subsequently
regional concentrations were formed where large banks, industries and markets
coalesced. But today capital flows internationally at rapid speed. Global
commerce no longer requires regional interactions among business players. Regional
capital concentrations in places such as New York ,
London and Tokyo
still persist, of course, but the capital concentrated there is no longer
sufficient for competitive advantage over other capitalists distributed
worldwide. Only if an organization is able to combine, integrate and apply its
resources (eg. Land, labour, capital, IT) in an effective manner that is not
readily imitable by competitors can such an organization enjoy competitive
advantage sustainable overtime.
In a knowledge-based theory of the firm, this
idea is extended to view organizational knowledge as resource with atleast the
same level of power and importance as the traditional economic inputs. An
organization with superior knowledge can achieve competitive advantage in
markets that appreciate the application of such knowledge. Semiconductors,
genetic engineering, pharmaceuticals, software, military warfare, and like
knowledge-intensive competitive arenas provide both time-proven and current
examples. Consider semiconductors (e. g. computer chips), which are made
principally of sand and common metals, these ubiquitous and powerful
electronics devices are designed within common office buildings, using
commercially available tools, and fabricated within factories in many
industrialized nations. Hence, land is not the key competitive recourse in the
semiconductor industry.
1. What is
required to ensure competitive advantages in specific markets?
(A) Access
to capital
(B) Common
office buildings
(C)
Superior knowledge
(D) Common
metals
2. The
passage also mentions about the trend of
(A) Global
financial flow
(B) Absence
of competition in manufacturing industry
(C)
Regionalisation of capitalists
(D)
Organizational incompatibility
3. What
does the author lay stress on in the passage?
(A)
International commerce
(B)
Labour-Intensive industries
(C) Capital
resource management
(D)
Knowledge-driven competitive advantage
4. Which
country enjoyed competitive advantages in automobile industry for decades?
(A) South Korea
(B) Japan
(C) Mexico
(D) Malaysia
5. Why
labour-based competitive advantages of India
and Singapore
cannot be sustained in IT and service sectors?
(A) Due to
diminishing levels of skill.
(B) Due to
capital-intensive technology making inroads.
(C) Because
of new competitors.
(D) Because
of shifting of labour-based advantage in manufacturing industries.
6. How can
an organization enjoy competitive advantage sustainable overtime?
(A) Through
regional capital flows.
(B) Through
regional interactions among business players.
(C) By
making large banks, industries and markets coalesced.
(D) By
effective use of various instrumentalities.
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