How do chance events play a role in shaping the competitive environment?

What will be an ideal response?

Chance events are occurrences that are beyond the control of a firm, industry, or government. Unexpected events include war and its aftermath, technological breakthroughs, sudden dramatic shifts in factor or input cost, changes in oil prices or production crisis, dramatic swings in exchange rates, and similar incidences. Chance events are important because they create major discontinuities in operation as well as in technologies. Such disruptions allow nations and firms that were not competitive to leapfrog over old competitors and become competitive, even leaders, in the changed industry. For example, the development of microelectronics allowed many Japanese firms to overtake U.S. and German firms in industries that had been based on electromechanical technologies. These electromechanical technologies traditionally were dominated by the Americans and Germans. From a systemic perspective, the role of chance events lies in the fact that they alter conditions in the diamond. The nation with the most favorable "diamond," however, will be the one most likely to take advantage of these events and convert them into advantages. For example, Canadian researchers were the first to isolate insulin, but they could not convert this breakthrough into a globally competitive product. Firms in the United States and Denmark were able to do that because of their respective national "diamonds."