p-ISSN: 2162-9374    e-ISSN: 2162-8416

2018;  8(2): 47-53



Reconfiguration Capability and Competitive Advantage: A Study of Port Harcourt Public Health Sector

Vivien Ejiro Wogwu1, Donald Ibama Hamilton2

1Doctoral Program of Department of Business Policy, Faculty of Management Sciences, Rivers State University, Nkpolu, Nigeria

2Dean, Faculty of Management Sciences, Rivers State University, Nkpolu, Nigeria

Correspondence to: Vivien Ejiro Wogwu, Doctoral Program of Department of Business Policy, Faculty of Management Sciences, Rivers State University, Nkpolu, Nigeria.


This work is licensed under the Creative Commons Attribution International License (CC BY).


The interesting reality of reconfiguration capability and competitive advantage is their effects and general usefulness in the Nigeria Public Health Sector. This component contributed to making the topic an important area for further research. Reconfiguration capability is the ability of an organization to rebuild assets and also gain knowledge for creativity that will enable it utilize opportunities and survive threats. Competitive advantage on the other hand, is the characteristics developed by an organisation to surpass its competitors. This study reveals some of the critical challenges faced in the public health sector in Nigeria that led to poor health care delivery and high mortality rate. Consequently, individuals and government personnel were compelled to seek medical attention outside the country, thereby promoting and improving the economy, particularly the health sectors of other countries as funds that would have been used in the country were deployed to other countries. This paper underpins the knowledge-based theory and the Porter’s five forces framework as well as the relationship between reconfiguration capability and competitive advantage, and the dimensions of reconfiguration capability. Conclusively, there is need to utilize and expand every important element of reconfiguration capabilities. I therefore recommend that the Nigerian government should focus attention on the best restructuring approach to strengthen the public health sector, especially the University of Port Harcourt Teaching Hospital (UPTH), Rivers State.

Keywords: Reconfiguration Capability, Competitive Advantage, Public Health Sector, Invention Capability and Consolidation Capability

Cite this paper: Vivien Ejiro Wogwu, Donald Ibama Hamilton, Reconfiguration Capability and Competitive Advantage: A Study of Port Harcourt Public Health Sector, Management, Vol. 8 No. 2, 2018, pp. 47-53. doi: 10.5923/

1. Introduction

The notable greatest component of existence is healthiness. No wonder the frequent memorable phrase “health is wealth”. According to the World Health Organization (WHO), health can be a defined as the body, mental, social and physical wellbeing. To earn income, there is need to work hard and this cannot be achieved when one is sick and lacking the physical ability required to work. This has lasted in our thoughts. The continuity of a nation’s efficacious and general advancement lies on the public health sector. Unhealthy individual would absolutely not live up to expectation and fundamental obligations. The administration of public health sectors are guided by established guidelines and principles desired for the accomplishment of certain goals in the sector. Although, usually authoritative in some cases, it involves display of aggressive attitudes which leads to loss of interest and commitment as the sector curbs down the activities in the country. Health is perceived as the features of physical, modern and personnel available over a period of time. Erinosho, (2006) asserts that structures and other firm infrastructure such as regular power supply, pipe borne water, good operative roads, etc. amidst the health care surroundings are the physical structures. Notwithstanding, technology is the tool used solely at providing for health care delivery and operations. Hospital infrastructure is accepted in analysis and numerical forms to indicate the attribute of care and accessibility of hospital service delivery within a state. Computer devices, consumables and personnel including the hospital specialist such as doctors, administrators, nurses, accountants, laboratory technologists, midwives, pharmacists, and other various staff shape the base of public health care allocation securely in any state and the elements of its foundation. Nigeria has recorded some advancement in the execution of its wellbeing over the years. This includes enhancement in major communicable diseases, maternal and child health. Lately, Nigeria was able to neutralize the transmission of unbroken poliovirus as well as elimination of guinea worm ailment and triumphantly restrained the expansion of the murderous Ebola virus disease. The operations of public health sectors in Nigeria, precisely the University of Port Harcourt Teaching Hospital (UPTH) is sluggish. According to le/4899/4741. This is the reason why people who ought not to die often do so. In Nigerian Public hospitals, sick persons on admission buy virtually everything such as bulbs for the wards, hand gloves for the nurses, disinfectant, detergent, syringes, drugs and compulsory donation of blood for those in labour wards, which is not always consumed by the patients at the end of the day. Lack and defaulted modern facilities, corruption, God-father syndrome in public hospitals and inadequate attention by the Nigeria government are reasons for the collapse of public health sector in Port Harcourt. Use of outdated facilities in the Port Harcourt public hospitals had over the years, brain drain of medical personnel, migration from the public to private hospitals in River State, particularly in the University of Port Harcourt Teaching Hospital contribute immensely to the decay experienced in the public health sector. Doctors in private medical practice dedicate more time to their patients and hospitals than the medical personnel in the public health sector. With this scenario, the patient lacks confidence in the activities of the public health sector. In addition, staff are irregularly paid salaries which does not encourage them to perform optimally. The income received annually does not equate to the excessive pressure and day-to-day exposure to dangerous and harmful diseases and chemicals in the public health sector. Moreso, the public health workers are the battle zone employees in the healthcare sector as it is observed in the University of Port Harcourt Teaching Hospital in terms of staff welfare, lately. These challenges had made the UPTH staff embark on persistent industrial action. Shortages of salaries and other benefits had encouraged Nigerian doctors and other public health specialists to travel abroad in search of better greener pastures. In reality, poor healthcare services in the country have led to the rise in death rate ( Consequently, individuals and most especially the government personnel seek for medical treatment abroad, thereby encouraging the international health sector and discouraging the Nigerian public health sectors as well as the personnel. From the above, one can deduce that the health sectors outside the Nigeria seem to gain competitive advantage over that of Nigeria.
Reconfiguration capability is the expansion of a mutual learning frame of mind which motivates components of the firm to combine the position of their wisdom and expert professionalism through team work. Reconfiguration capabilities is the organizational skill required to rebuild assets and learning in order for creativity to take place (Jantunen; Ellonen; and Johansson, 2012). Reconfiguration of current assets and capabilities through recent models of consolidation is enough for further complication than combination, as it includes the positioning of familiarized resources to create new worth, thus improving the mixtures inside and between firms (Lockett; Thompson; Morgenstern, 2009; Teece, 2007).
Competitive advantage is significant when understanding worth idea. If the worth idea is useful, it means the worth ideas give customers improved and better worth. It can create a competitive advantage in either the output or responsibility. The worth idea can expand client anticipations and options. Competitive advantage in the public health sector performs a vital task; it does not only enhance the public health services but also eradicates incompetence and waste. Most likely, no forces from rivalries take its price on the attribute of services. Public health sectors are lured to select advantage through invention and consolidation capabilities. These capabilities are strategies for struggling for the special features and grow fundamental abilities with which firms can have an edge, become outstanding and detach from other health sectors outside the country. Reputation is one of the roots of competitive advantage which can be positioned to public health sector in Port Harcourt. In the public health sector, funds are disbursed for the running of the sectors and if the funds are adequate for its purpose, it therefore means that such fund is efficiently utilized (Popa; Dobrin; Popescu; and Draghici, 2011).

2. Literature Review

2.1. Theoretical Framework

This study underpins two theories:
2.1.1. The Knowledge-Based Theory
The above theory ponders on knowledge as the most tactically important asset of an organization. Its advocates that knowledge-based assets are normally complicated to emulate and communally complex. Different knowledge bases and capabilities among organizations are the main elements of stable competitive advantage and outstanding collective achievement. Without knowledge, organizations cannot reconfigure, restructure and reshape their products in such a manner that they gain competitive edge over their rivalries. In other words, this theory, helps organizations in boosting their product so as to win their competitors.
This derived knowledge is deeply rooted and conveyed through compound beings and includes organizational culture and personality, rules, customs, records, mechanisms and functionaries. According to Penrose, (1959) inventions from the tactical management scholars reveals that this position construct broadens the resource-based opinion of the organization originally advanced by and later developed by others (Wernerfelt, 1984; Barney, 1991; Conner, 1991).
Alavi, and Leidner, (2001) contend that in spite of the resource-based perspective, the organization identifies the significant function of knowledge in organizations that helps to attain a competitive advantage. Advocates of the Knowledge-Based View (KBV) stress that the Resource-Based View (RBV) does not operate sufficiently alone. Categorically, the RBV regards knowledge as an all-encompassing asset, instead of having distinctive features. Consequently, it does not categorize various types of knowledge-based capabilities. Information Technology can show the essential character in the knowledge based view of the organization such that information structure can be adopted to improve, incorporate and quicken substantial intra and inter-organization knowledge management. Nevertheless, the Knowledge based theory of the organization establishes a theory that has been the issue of noticeable argument (Foss, 1996; Phelan, & Lewin, 2000).
2.1.2. Porter's Five Forces Framework
This is a tool for determining the competitive position of a firm. It draws from technical, mechanical and modern firms to develop five efforts that regulate the competitive strength, thus, the allure of a firm in agreement to its advantage. An unappealing firm is the one that has aftermath on the five forces and cuts down on the long-term profitability. The most repugnant firm would be one impending real competition, which make gains feasible to all firms that are directed to routine profit heights. Porter refers to these forces as the small surrounding which compares it with the more common term for large surrounding. These include forces near to a firm that influence its strength to provide its clients and make more profit. A transformation in any of these forces usually would require a firm to re-examine the marketplace given the general change in organizational information. The comprehensive organization enticement does not indicate that every department in the organization will bring similar return. Businesses are able to implement their bottom line proficiency, firm ideal or grid to accomplish a return higher than the firm’s standard. The commercial transportation services are conventional examples of such firms. When earning is flat in any given organization, it simply means that such organization’s fundamental framework has great steady costs rate and little fluctuating costs, allowing excessive freedom in the transportation cost. Different transportation services turn to contend on price, which have led to decline in the profitability of distinctive transporter as well as the firm. The passengers therefore would prefer the transport services that is safer, has sound vehicles with expert drivers, and of course the one with more advantages and cheaper in terms of price. Confined achievement with expert’s application of distinction in order to boost earnings was recorded for Richard Branson's Virgin Atlantic.
Porter's five forces contain three forces from parallel competition namely: the danger of alternative commodities, the danger of entrenched competitors, and the danger of current rivals. The other two forces are derived from erect competition - the ability to deal with distributors and the ability to deal with purchaser/end users.
Porter advanced his five forces structure in response to the then well-known Strength, Weakness, Opportunity and Threat (SWOT) investigation, which he established deficiency in strictness and ad hoc. Porter's five forces framework is founded on the structure administration accomplishment model in organizational economics. It has been enforced by trying to address various aspects of challenges ranging from assisting firms to increase their earnings to assisting government to sustain organizations. Other Porter’s plan of action devices are the financial worth string and common competitive approaches. Porter has committed concentration to understanding and addressing the urgent challenges in health sector in the United States and other countries. In his publication, Redefining Health Care by Elizabeth Teisberg, a fresh crucial structure for restructuring the cost transferred by the health care sector produced significant manifestations for providers, health strategies, chief executives, government and several other performers.

2.2. Conceptual Framework

Figure 2.1. A framework describing the relationship between Reconfiguration Capability and Competitive Advantage
2.2.1. Reconfiguration Capability
Reconfiguration capability involves the activities in which organisations engage when adding, redeploying, recombining, or divesting resources or business units (Karim & Capron, 2016). Verona, and Ravasi, (2003) asserts that the series of actions that would achieve results or the framework that redefines the organizational role, indicates a relevant design in an adaptable approach as to make it effortless to steadily re-integrate assets. Routine reconfiguration of the designs of connected natural resources shapes the significance of plan of action (Brown, and Eisenhardt, 1998; Hargadon and Sutton, 1997). Reconfiguration Capabilities can be created inside or can be obtained outside the origin. Construction of capabilities basically connects with the revolution of current capabilities, i.e. complete renewal in the pattern, mode, form, design or display of current capabilities within the industry (Carlile, 2004; Teece, 2007). According to Galunic, & Rodan, (1998), some of these capabilities involves the re-positioning and the re-consolidation capabilities. Obtaining capabilities attributes to buying capabilities inside or outside tangible deportation from external origin, for example, authorization, acquisition agreements, transferring, consolidation and purchase of industries or components of firms (Capron; Dussauge, & Mitchell, 1998; Capron, & Mitchell, 2009; Lavie, 2006), recently created capabilities or purchased more needs to be consolidation into the current capability structure. Consolidation indicates that the incorporation of current capabilities into the organization, joining and connecting them with recent natural assets and capabilities produced structure that enabled the firm overcome competition favourably (Eisenhardt & Martin, 2000; Iansiti & Clark, 1994; Teece, Pisano & Shuen 1997; Teece, 2007). Reconfiguration capability, thus, mirrored the common skill to develop new capabilities and the power to combine recently created or obtained capabilities and self-reliant of the precise circumstances.
2.2.2. Invention Capability
This attributes to the power to act inwardly and structuring of current machine capabilities. Capability development involves the renewal of understanding into innovative capabilities (Kogut, & Zander, 1992; Zahra, & George, 2002). The National Health Insurance Scheme (NHIS) is a good example of invention strategy in the Nigeria health care. In addition, the skill to re-integrate current capabilities into new fashion consolidations drives the advancement of current functional capabilities (Eisenhardt & Martin, 2000; Zander & Kogut, 1995). This also involves the reconfiguration of actual configurations by connecting their elements in a fresh form (Henderson, & Clark, 1990). The aforementioned power to act facilitates the fruitful advancement of current capabilities. The construction of current capabilities or the adjustment and enhancement of existing capabilities sustains the industry’s capability structure (Helfat & Peteraf, 2003). It is therefore, required to be firmly linked to the advancement of functional capabilities and the industry strength. The reconfiguration capability includes re-consolidation, re-integration, re-hiring of assets such as machineries and existing structures and the unification of new understanding in the formation and modernization of current commodities and labour expected by the market. Rodenbach, & Brettel, (2012) maintains that fruitful enforcement of the reconfiguration relies on understanding the business atmosphere, managerial knowledge and intellectual administrators and crews of Chief Executives (Helfat, & Peteraf, 2014); the assistance of the system (Schlemmer and Webb 2008), the corporate struggle and teamwork of different sides within and outside grids, respective association and administrative knowledge (Hamid, 2010).
Akman, & Yilmaz, (2008) affirms that rivalry among industries is becoming tougher on daily basis. This is as a result of many administrative and environmental factors such as development, free trade, expanding international and local competition and invention of new machines. Novelty could be acknowledged as a major accomplished component in a progressively competitiveness in a complicated atmosphere. The deed of modernizing can afford an industry with the ability to abduct a steady smooth market allotment or build an absolutely new market freedom that permits industry to obtain remarkable earnings. The sluggish feedbacks of rivals to such novelty plan of action will turnout competitive edge to the industry (Lim, 2010).
Abbing, (2010) maintains that a novelty plan of action becomes a strategy on how to apply the advancement of modern commodities, usefulness, mechanisms or organizational models to accomplish set goals. Competitive advantage defined as the ability of the firms to render excellent commodities and services to the end users examines the differences between with the commodities and services rendered by the competitors. The greater aggressive competitiveness in-line is examined in contrast with the competitors and accustomed by financial value, post-selling services quality, features of commodity, the organization’s ability to acclimatize the offering of money or service to the market demand and mechanical development.
2.2.3. Consolidation Capability
Consolidation capability refers to the techniques used in making a business healthy. It is also the power to add modern potentials into the business’s current capability structure, joining and connecting them with actual possessions and capabilities (Eisenhardt, & Martin, 2000; Iansiti & Clark, 1994; Teece et al., 1997; Teece, 2007). Consolidation capability is the main root of capability development (Iansiti& Clark, 1994). When fresh capabilities are developed or earned, it is relevant to consolidate the above mentioned fresh capabilities into the current capability configuration without suffocating the capability and adaptability of the current capability configuration. Hence, the strength to consolidate fresh capabilities outside outraging the capability configuration is probably linked to the fruitful advancement of functional capabilities and to business competence absolutely. The major means for attaining competitive edge over other contenders is through newness, originality, creativity and uniqueness (Popa, 2004). The consolidation capacity is also a means of competitive advantage. This is because creativity influences the root of the business and provides solutions to the following inquiry: How can we reform service and its transfer to the end users so as to boost its worth and make it unique from other competitors? Innovation is probably one of the most significant means of competitive advantage. There is need therefore, for organizations to steadily adjust to public transformation, the needs of nationals, business partners, etc., in the same vein and this leads to development.
2.2.4. Competitive Advantage
Competitive advantage can be seen as the characteristic that permits business to surpass its competitors. A competitive advantage may involve availability of assets, for example inexpensive capability origin, exceedingly experienced worker, topographical region, tremendous access through obstacles, and entry to new scientific techniques. Porter, (1985) ascertains two techniques in which a business can enhance competitive advantage over its competitors. These are price advantage and distinctive advantage. Price advantage occurs when an organization supplies the same commodities and services as its rivals, although at a lower price. Differentiation or Distinctive advantage on the other hand occurs in a situation where an organization supplies more attractive, appealing, effective, useful and high quality commodities and labour as its rivalries. Competitive advantage tries to handle certain reviews of comparative advantage. Competitive advantage depends on the notion that low-cost service is widespread and raw materials are not important for a better nation. The comparative advantage theory concentrates on specific area of exporting essential commodities and natural resources that lure societies into poor-income economies as a result of buying and selling. Stutz and Warf, (2009) affirms that competitive advantage tries to perfect this matter by emphasizing on boosting proportion economies in commodities and labours that accumulate exceptional costs. Favourably enforced plans of action will boost a business to high accomplishment by aiding the business with competitive advantage to defeat contemporary or potential competitors (Passemard and Calantone 2000). To attain competitive advantage, an industry plan of action manoeuvres the different assets on which it has direct authority and these assets have the capability to create competitive advantage (Reed, R. and DeFillippi, 1990 cited by Rijamampianina 2003). More skilful accomplishment consequence and dominance in the manufacturing of raw materials indicates competitive advantage (Day and Wesley 1988 cited by Lau 2002).
Due to the above mentioned confrontation in the public health sector, more specifically, the University of Port Harcourt Teaching Hospital, Rivers State, Nigeria, this study seeks to support the most excellent access to boost the Nigeria public health sector in terms of the feature of decision making, good infrastructure, quality service delivery, sufficient power supply, innovation of rejected facilities, supplies of current facilities, training and re-training of staff, use of qualified health personnel, payment of staff as at when due, good leadership and appropriate funding etc.
Other scholars have not studied reconfiguration capability and competitive advantage in Nigeria, although, it had been studied outside Nigeria, hence the need to study this interesting topic and relating it to the Nigerian environment.

3. Conclusions

There is need to utilize and expand every important element of reconfiguration capabilities and also neglect the advancement of those with unfavourable result(s) on reconfiguration capability. Zahra, Sapienza and Davidsson, (2006) reveals that deploying reconfiguration capability under the incorrect cause-effect will negatively affect the performance of the firm.
According to Porter, (1985), a firm which can achieve competitive edge over its competitors is said to be above an average performer in a particular industry. From the above, reconfiguration capability therefore, is evaluated as being strong. The work of Teece (2007), also disclosed a positive relationship between reconfiguration capability and competitive advantage. The result of Kiiru, (2015) shows a similarity when compared with Teece, (2007). Based on the above findings, there is a relationship between invention capability and competitive advantage as well as consolidation capability and competitive advantage in the Nigeria public health sector.

4. Recommendations

In agreement with the ascertained relationship between the invention, consolidation capabilities and competitive advantage, the following recommendations were made:
1. The Nigerian government should focus attention on the best restructuring approach to boost the public health sector, particularly at the University of Port Harcourt Teaching Hospital (UPTH), Rivers State.
2. The Management of UPTH should cultivate the habit of training and retraining of staff to enhance productivity.
3. There should be quality leadership in the management of UPTH.
4. There should be good reward system for staff as to encourage them to be more committed to their duties and also build confidence in them.
5. There should be regular payment of salaries and other fringe benefits as at when due.
6. The Nigerian government should formulate policies or sanctions that would discourage people from seeking medical treatment outside the country with exceptions to some very critical cases that must be referred outside the country due to lack of specific facilities.
7. The facilities in the public hospitals should be improved so as to discourage patient from migrating to the private health sector and outside the country.


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