There is a fundamental conundrum in our theories of firm competitive advantage. Although both the positioning and resource based theories argue that firm’s unique strategies should lead to superior performance, empirically we find that unique strategies reduce firm financial performance. Scholars have suggested this ‘uniqueness paradox’ arises because the information, cognitive, and incentive limitations of equity analysts lead capital markets undervalue unique strategies. We contribute to this literature by examining how the uniqueness of strategic change influences firm financial performance. We argue that the theorized informational and cognitive limitations should reduce with greater persistence of strategic change, and that this effect is even more consequential when the strategic change is both unique and complex. We test and find support for our hypotheses using longitudinal data from the global pharmaceutical industry from 1995 to 2020. We used a novel text based machine learning technique based on topic modeling to create measures of uniqueness, persistence, and complexity of strategic change. This technique is superior to typical accounting based measures used in prior work since it allows us to capture more broadly changes across firms’ value chain. These findings enrich our understanding of the contingencies under which unique strategies improve firm financial performance.
