This Is a national perspective!
Factor Endowments – The nation’s position in factors of production, such as skilled Labor or infrastructure, necessary to compete in a given industry. Must be industry and firm specific. Firm-specific knowledge and skills that are Rare, valuable, difficult to imitate and rapidly and efficiently deployed Ultimately lead to a nation’s competitive advantage. Examples: Japan JIT inventory management, low cost and sufficiently high quality Software development in India.
Demand conditions – Home countries with Demanding consumers drive firms to meet high standards, upgrade existing Products and services, drive for further innovation, etc. The home countries’ consumers influence, push And support. Consider Chinese or Indian Car companies trying to enter US or China. RELATED TO CONSUMERS
Related and supporting industries – Availability of supply services, support, technology that are valuable to Firms’ supply chains. Additionally, Firms in related industries offer the ability to partner, share, etc.
Domestic Rivalry provides a strong force for firms to innovate and find new sources of Competitive advantage. Nations with Firms with this experience are more likely to have more national and firm Experience in developing competitive strategies and effective organizational Structures. RELATED TO COMPETITORS