CRITICALLY ASSESS THE PROPOSITION THAT COMPETITIVE ADVANTAGE IS HIGHLY DEPENDENT UPON EFFECTIVE HUMAN RESOURCE STRATEGIES. ILLUSTRATE YOUR ANALYSIS WITH PRACTICAL EXAMPLES WHEREVER POSSIBLE.
             " Future success depends on enabling everyone , regardless of gender , ethnic background or disability , to use their abilities to the full. When staff typically constitute the biggest item in the cost base; when knowhow and innovation are the stock in trade; it makes excellent commercial sense to invest in human assets and to engender a maximum return on that investment."
             Lord Alexander of Weedon QC, Chairman,
             In todays business environment it is increasingly being claimed that the management of human resources is one of the key links to gaining and retaining competitive advantage. This report intends to assess this claim, using case studies and examples where possible.
             Porter (1985), states that the rules of competition are embodied in five competitive forces; the entry of new competitors, the threat of substitutes, the bargaining power of buyers, the bargaining power of suppliers, and the rivalry among the existing competitors. Porter argues that the collective strength of these competitive forces will determine a firms ability to sustain competitive advantage.
             "Competitive advantage grows fundamentally out of value a firm is able to create for its buyers that exceeds the firms cost of creating it. Value is what buyers are willing to pay, and superior value stems from offering lower prices than competitors for equivalent benefits or providing unique benefits that more than offset a higher price."
             He also suggests that there are two different types of competitive advantage. Cost leadership, whereby a firm aims to become the low cost producer in its industry, and differentiation, where a firm seeks to be unique in its industry along some dimensions that are wide...