Cap 4 Flashcards
(35 cards)
Resource-based View
When the industry environment is volatile, internal resources and
capabilities offer a more stable basis for strategy than an external
market focus
-Resources and capabilities are the primary sources of competitive
advantage
Competency
possession of sufficient knowledge or skill
Core competency
a collection of competencies that cross divisional boundaries, is wide-spread
throughout the corporation and is something the corporation does
exceedingly well
Distinctive competency
core competencies that are superior to those of the competition
Capabilities
business processes and routines that manage the interaction
among resources to turn inputs into outputs
Strategic capabilities
The resources and competences of an organization needed for it to survive and prosper
Competitive Advantage
an attribute that allows an organization to outperform its competitors
Advantage
superiority of position or condition
Sustained Competitive Advantage
ability to possess VRIO
VRIO framework
-Valuable
-Rareness
-Imitability
-Organization
Valuable
Does it provide customer value and competitive advantage
Rareness
Do no other competitors possess it at the same level
Imitability
the rate at which a firm’s underlying resources, capabilities, or core competencies can be duplicated by others
* Transparency: the speed at which other firms under the relationship of resources and capabilities support a successful strategy
* Transferability: the ability of competitors to gather the resources and capabilities necessary to support a competitive challenge
* Replicability: the ability of competitors to use duplicated resources and capabilities to imitate the other firm’s success
- Explicit knowledge: knowledge that can be easily articulated and communicated
- Tacit knowledge: knowledge that is not easily communicated because it is deeply rooted in employee experience or in the company’s culture
Organization
the organization must be structured and aligned around the true competitive advantages of the business
Business Models
a company’s method for making money in the current business environment
* includes the key structural and operational characteristics of a firm—how it earns revenue and makes a profit
Value Chain
describes the categories of
activities within an organisation which, together, create a product or service. linked set of value-creating activities
-Raw materials
-primary manufacturing
-fabrication
-distributor
-retailer
Value chain segments include
-Upstream
-Downstream
Center of gravity
part of the chain that is most important to the company and the point where its core competencies lie
primary activities
-Inbound logistics
-operations
-outbound logistics
-marketing and sales
-service
support activities
-Firm infrastructure
-Human resource management
-technology development
-procurement
Uses of The Value Chain
- A generic description of activities
- Identifying activities
-Analysing the competitive position (using VRIO)
-Enhance value or decrease cost
Basic Organizational Structures
- Simple
- Functional
- Divisional
-Strategic business units
-Conglomerate
Corporate Culture
the collection of beliefs, expectations, and values learned and shared by a
corporation’s members and transmitted from one generation of employees to another
Functions of Corporate Culture
- Conveys a sense of identity for employees
- Generates employee commitment
- Adds to the stability of the organization as a social system
- Serves as a frame of reference for employees to understand
organizational activities and as a guide for behavior
