| Summary: | The aim of this study is to find the effect of strategic acquisition and strategy of internal growth in overall company performance and determine how these two strategies help companies achieve competitive advantage. Competitive advantage is a phenomenon which gives the company the status of superior performer vis-a-vis its competitors, enables the company to operate more efficiently, provides the company’s environment with better outcome and keeps its stakeholders motivated, satisfied and happy. A very small number of companies enjoys the benefits of competitive advantage. This is the consequence of insufficient knowledge of which tools to use so that competitive advantage can be achieved.Having this in consideration, I analyze the nature of strategic acquisition, its effect on competitive advantage and what are the advantages and disadvantages of strategic acquisition towards internal growth. Once this advantage is achieved, keeping eye on how to manage interrelationships among activities in the value chain, constantly evaluating cost advantage and taking care that it doesn’t have any effect on differentiation is essential for company to keep competitive advantage sustainable.My advisor for this thesis is Þóra Christiansen at the University of Iceland School of Business
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