The Strategy for Sustainable Competitiveness: Theoretical Extension and Application to Global Conglomerates in Cultural Industries

Abstract

This study is intended to introduce how the value chain framework can be modified for a more accurate analysis of global media conglomerates and their sustainable competitiveness. This study conducts an in-depth review of prior theories and business concepts on diversification, process strategy, and business ecosystem to provide the transformative trajectories of conglomerates. This study then reconciles these business theories in understanding conglomerates by showing that it is essentially the convergence, or the synergistic diversity, in the nine value chain activities that enables firms to form a strong business ecosystem and sustainable competitiveness. This papers contributions are divided into conceptual development of business theories and empirical analysis. By improving the original value chain framework to analyze the cultural industries, specifically the motion pictures industry, this paper shows how the synergistic diversity along the value chain activities enables firms to grow and sustain competitiveness. By applying this extended model to the film-producing companies in the US, Korea, Japan, and China, the study shows the different but meaningful growth trajectories of conglomerates and how they create sustainable competitiveness by networking with other firms and society.