The advantages of being disadvantaged

Abstract

Although many contributions examine how individuals and various entities (e.g., organizations and countries) manage to obtain a (competitive) advantage, there is a knowledge gap on how to make the best of disadvantages. Using notably the theories of self-enhancement and psychological reactance, the existing literature has explained the mechanisms that can motivate and support an entity to get out from a disadvantageous position. We go further by addressing the “how” issues. We conceptualize disadvantages and adopt a provocative stance by showing how they can be transformed into valuable opportunities. Specifically, we document how being disadvantaged may be a driver of compensatory behaviors, effectual thinking, and innovation and serves as an emotional bond and in-group marker. We also draw managerial and policy implications that offer a refreshing view on how to take advantage of disadvantages, such as changing the non-market context and promoting the disadvantage as a market differentiation factor. As a caveat, adopting this stance should not be interpreted as a catch-all solution that exonerates stakeholders from doing their part in providing support to disadvantaged entities.