Competitive advantage and HRD

• DOI: http://doi.org/10.1002/hrdq.21413
• Date: 01 December 2020
• Published date: 01 December 2020
• Author: Thomas G. Reio

EDITORIAL

Competitive advantage and HRD

It is hard to argue that these are not the most challenging of times we have had in generations. Politically, leaders are

being crushed with meeting the profound concerns of their citizens regarding their safety and ways of life. Economi-

cally, national, regional, and local economies are deeply troubled because many businesses are suffering mightily; at

any moment, they can be forced to reduce their operating hours and number of patrons served or even close due to

COVID-19 mandates. “Non-essential”for-profit businesses like movie theaters, restaurants, and department stores

are especially vulnerable to being forced by a confusing array of mandates to close, leaving the companies and its

employees in dire financial straits. Non-profits and governmental agencies are suffering arguably just as much. How I

long to visit my local library and attend our local amphitheater to hear my favorite folk artists performing for free!

Delicate work/life harmonies are being tested also as many are working from home, with concomitant pressures for

parents and other caregivers to work with dedicated teachers at home to make online teaching efforts designed for

our K-12 youth appropriate and meaningful. Clearly, we all need to work together to make our current and future

ways of life more safe and manageable.

In response to economic pressures, all-too-often a company's first line of defense is seemingly to reduce staff.

Debatably, with less customer traffic, the need for pre-COVID-19 staffing levels may not be required. Thus,

employees at each level need to be aware of how they contribute both individually and as a team/group to the orga-

nization's viability. In prior economic downturns, human resource/development (HR/D) professionals tended to be

among the first to be furloughed or made redundant. In response to this pattern of administrative and managerial

behavior, HR/D professionals have found clever ways to demonstrate that HR/D-related activities do deliver much

to the organization's bottom-line. Using Kirkpatrick's (1994) evaluation framework, for instance, one can design train-

ing and development endeavors where evidence can be accumulated at the four levels of evaluation (reaction, learn-

ing, behavior, results) to support the efficacy of said endeavors. Ultimately, providing training and development

activities for workers, front-line and middle managers, and top management can be a factor in producing desirable

organizational outcomes. Although the four-level model has been critiqued widely as being too narrow, simplistic,

etc., it remains among the most well-known and respected evaluation models (see Reio Jr., Rocco, Smith, &

Chang, 2017). The point is that by accumulating the data generated from the four-level evaluation, or other types of

systematic evaluation, compelling evidence can be presented that supports the financial impacts of HR/D to the

organization, thereby averting uninformed strategic decisions about whom to let go during economic downturns.

Being attentive to how HR/D contributes specifically to the company's competitive advantage could be another

means for HR/D professionals to demonstrate the degree to which they support the organization. Porter (1980), in

his theory of competitive advantage, posits that low cost and differentiation are two basic strategies that companies

might use to create value and attain competitive advantage. The overarching goal then for companies is to not only

attain competitive advantage, but sustain it. Porter defines competitive advantage as the company's ability to out-

perform its competitors in an industry (e.g., the organization has a higher profit rate relative to its competitors). Supe-

rior value is created when the business has a lower cost structure and/or a product that has been differentiated to

the degree that customers would be willing to pay more. Companies like Walmart have a competitive advantage in

the retail industry through a lower cost structure. In the car industry, Toyota can charge more, and be more

profitable, because they have differentiated their cars where potential customers perceive greater value in their

product, despite the higher prices.

DOI: 10.1002/hrdq.21413

© 2020 Wiley Periodicals LLC.

Human Resource Development Quarterly. 2020;31:353–354. wileyonlinelibrary.com/journal/hrdq 353