What comes first, advantages or value? How does causation run – does superior value result in advantages, or do advantages result in superior value? This is a sort of what comes first, the chicken or the egg?
Closer inspection of this question shows that the latter must be true. Superior value rests on the notion of offering higher benefit and utility to consumers than that offered by rivals. The source of this superior value must be found in advantages and capabilities that rivals do not possess. Advantages are simply the benefits that a firm enjoys when it uses and applies its resources in a way that rivals cannot easily emulate. This, in turn allows the firm to offer differentiated value that provides higher utility to consumers.
Advantages themselves result from developing and applying strength against weakness, or from finding and exploiting points of leverage that have gone unnoticed by rivals. Advantages are built up over time – by pursuing a set of coherent actions that guide a firm in marshaling and applying its resources in a particularly effective way. This is the role of strategy.