Internal Analysis Flashcards
(14 cards)
What is the structure of the internal analysis?
- Mission & Business Model
- Current Business-Level and Corporate-Level Strategies
- Identify resources (tangible and intangible), capabilities
- VRIN analysis to identify core competencies
- Value chain analysis
- Conclude by identifying strengths and weaknesses
What are examples of corporate-level strategies?
- Internationalization / expansion into new markets
- Mergers and Acquisitions
- Vertical Integration
- Alliances and Collaborative Partnerships
What are some examples of business-level strategies?
- Differentiation strategy
- Cost leadership strategy
- Focused Cost Leadership
- Focused Differentiation
- Integrated Cost Leadership / Differentiation
What are the 4 types of tangible resources?
- Financial Resources
- Organizational Resources
- Physical
- Technological Resources
What are the 3 types of intangible resources?
- Human
- Innovation
- Reputational
What are examples of capabilities?
R&D, manufacturing, marketing, customer service
What are core competencies?
Capabilities that serve as a source of competitive advantage for a firm over its rivals. Used in VRIN framework.
What does VRIN stand for?
V - Valuable
R - Rare
I - Costly to Imitate
N - Non-subsitutible
What is the goal of a value chain analysis?
To understand the parts of a firms operations that create value and those that do not to understand the firm’s strengths and weaknesses.
What are primary activities?
Inbound logistics, operations, outbound logistics, marketing & sales, service
What are supporting activities?
HR management, financial management, technology development, strategic management, procurement
How to go about the value chain analysis?
- Identify the primary and supporting activities
- Ask yourself: Where does the company excel (strengths) and where are they struggling (weaknesses)
- Link back to business-level strategy
How to go about the VRIN framework?
- List 2-3 capabilities the firm has
- Apply the VRIN test to each
- Evaluate if capabilities are core competencies (sustainable competitive advantages)
What should firms consider when they cannot create value?
Use outsourcing
