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LECTURE WK 4 SWOT Strengths, Weaknesses, Opportunities, and Threats (SW –INTERNAL, OT- EXTERNAL) “SWOT analysis came from the research conducted at Stanford Research Institute from 1960-1970.” (Humphrey, 2005, p. 7)Based on a substantial body of work and initially designed for project evaluationIs most commonly used to examine and organization as a wholeAt the time, Corporate Planning was in vogue but as it was mainly interested in long-term planning, it was “not working” (Humphrey, 2005, p. 7)FLIGHT CENTRE IN AUSTRALIA SWOTCritiques of SWOT It’s fairly one dimensional insofar as you simply create lists under each (Hill & Westbrook, 1997).Research would suggest that people do these SWOT analyses, then never actually use the outputs. (Hill & Westbrook, 1997).It never critically questions the objective(s) in the first place (Chermack & Kashanna, 2007)You can do an insightful and comprehensive SWOT analysis, for a terrible idea.However, it could be argued that this is strength of SWOT – you could do a SWOT for a collection of ideas. Value ChainDeveloped by Porter in 1985A conceptual framework that helps us to understand the processes by which organizations take inputs, add value, and produce outputs. Map out organization’s process and identify opportunities to increase valueTwo core parts are: 1.Primary activities-Includes: Inbound logistics, operations, outbound logistics, marketing/sales, and service
2.Support activities-Includes: Firm Infrastructure, Human Resource Management, technology development, and procurement.However, this is not to suggest that primary activities are more or less important to the success of the organization than support activitiesFlight Centre Critiques of Value Chain By nature, it can deceive us into seeing an organization as a linear input>value add>output system.Lends itself most easily to manufacturing of goods“It was created at a time when being big and having scale was in itself a key aspect to competitive advantage and profitability.” (Merchant, 2012)It is hard to translate to smaller, more agile or nimble organisations.It doesn’t distinguish between generic and distinct goods.Resource Based View (RBV)“The resource-based view (RBV) of the firm holds that certain assets with certain characteristics will lead to sustainable competitive advantage. All the traits are required to be present to result in a sustainable competitive advantage” (Black & Boal, 1994, p. 131)Often credited to Wernerfelt (1984)There are many theories that fit within the Resource Based View, to some degree e.g. VRIODrucker on Strengths “One gets paid only for strengths; one does not get paid for weaknesses. The questioning, therefore, is first; -What are our specificstrengths?