Ch4Notes - The Internal Environment The Strengths and...

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The Internal Environment The Strengths and Weakness of the Firm A Firm’s Tangible & Intangible Resources combine with Firm’s Capabilities to create Distinctive Competencies Distinctive Competencies – those activities that a firm performs better than any competing firm
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The Internal Environment The Strengths and Weakness of the Firm Sustained Competitive Advantage – firms that possess and exploit costly to imitate, rare, and valuable resources & capabilities in choosing and implementing their strategies may enjoy a period of sustained competitive advantage and above normal economic profit.
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The Internal Environment The Strengths and Weakness of the Firm Tangible Resources: Dow Chemical’s research laboratory and facilities Intel’s semiconductor fabrication facilities
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The Internal Environment The Strengths and Weakness of the Firm Intangible Resources: Toyota’s well-known and trusted brand names , New Season’s good reputation , Intel’s knowledgeable and creative workforce , Sun Microsystems’ unifying corporate culture , Subway’s international experience with different country’s regulations on franchising, Norm Thompson Outfitters’ visionary leader with strong motivation and communications skills,…
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The Internal Environment The Strengths and Weakness of the Firm Capabilities Emerge over time through complex interaction between and among tangible and intangible resources. Become stronger and more valuable strategically through repetition and practice. Skills and knowledge of firm’s employees, including functional expertise (human capital)
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The Internal Environment The Strengths and Weakness of the Firm Capabilities Examples: Toyota’s efficient distribution systems - Just-in-time (JIT) delivery, strong supplier relationships, and well-trained inventory specialists. L.L. Bean’s customer segmentation procedures and systems - database management systems, effective market research efforts and strong supplier relationships. Nike’s new product development procedures – creative workforce and innovation-driven culture, strong leadership, and effective market research.
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The Internal Environment The Strengths and Weakness of the Firm Distinctive Competencies: The VRIO Framework Question of Value: Do a firm’s resources and capabilities enable the firm to respond to neutralize external threats and/or capitalize on external opportunities? Example: Are InFocus’ engineers and marketing staff able to develop and sell home-based projector systems before its competitors?
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The Strengths and Weakness of the Firm Distinctive Competencies: The VRIO Framework Question of Rarity: Is a resource or capability currently controlled by only a small number of competing firms? Example: Does InFocus have the technical expertise and
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This note was uploaded on 08/26/2011 for the course BUSINESS 102 taught by Professor Jenkins during the Spring '11 term at Kaplan University.

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Ch4Notes - The Internal Environment The Strengths and...

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