Resources Canvas Flashcards

(27 cards)

1
Q

Name the two perspectives on strategic management?

A
  1. Business-level strategy
  2. Corporate level strategy
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2
Q

Name two characteristics of a business level strategy perspective?

A
  1. Competitiveness is determiend at the level of individual business
  2. Competitiveness is driven by smart industry positioning or excellent resource positions
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3
Q

Name two characteristics of a corporate-level strategy perspective?

A
  1. Competitiveness is determind by a mix and balance of individual businesses
  2. Questions for corporation involve product, geographic and partner scopes
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4
Q

What is a resource?

A

This is a productive input or competitive asset owned or controlled by a company

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5
Q

what is the difference between tangible and intangible resources?

A

Tangible resources can be touched (machinery and buildings)

Intangible resource cannot be touched (IP, brand name, reputation)

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6
Q

What is a capability / Competency?

A

Capacity to carry out activities competently. How well can a company do certain things

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7
Q

What is a core competency?

A

Activities that are fundamental to performance of an organization. The collective knowledge about how to coordinate diverse production skills and technologies

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8
Q

What are distinctive competences?

A

activities that the company can do better than competitors.

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9
Q

How are aspirations set and what are the consequences of aspirations?

A

Aspirations are set historically or socially:
- How are we doing against ourself in earlier periods (historically)
- How are we doing against competitors (socially)

Performance and performance feedback involve subjective perceptions against aspiration levels. Asporations therefore influence performance and performance feedback

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10
Q

Name two ways in which aspirations become critical inflection points for decision makers?

A
  • Performance below aspirations levels leads to problemistic search and swinging for the fences
  • Feedback on performance above aspirations leads to overexploitation and competence traps
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11
Q

what are dynamic capabilities?

A

competencies that allow you to adopt your company and make it future proof

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12
Q

Name the primary driver of superior performance?

A

Luck

  • R&D luck (pharmaceutical molecules, serendipity)
  • Compatibility luck (platform technology, emerging industries)
  • Position luck (first-mover advantages, investing in regulatory uncertain products)
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13
Q

Name two threats undermining the sustainability of superior performance?

A
  1. Scarcity: competitive advantage is based on a scarce resource
  2. Appropriation: owners can benefit from competitive advantage
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14
Q

Name two ways in which scarcity could undermine the sustainability of superior performance?

A
  • Imitation: will competitors be able to imitate resource position
  • Substitution: will competitors offer substitute products that meet same customer needs
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15
Q

Name two ways in which appropriation could undermine the sustainability of superior performance?

A
  • Hold-up: Owners appropriate return on competitive advantage
  • Slack: Bureaucracy and inertia drive out return on competitive advantage
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16
Q

What is meant with imitation under scarcity?

A

Do companies that lack attractive resource positions face a cost disadvantage compared to companies that already own attractive resource positions:
 If not: outperformance position is likely to be lost through imitation
 If yes: resource is inimitable or costly-to-imitate and a company can probably achieve a temporary competitive advantage

17
Q

What is meant with substitution under scarcity?

A

do companies lacking attractive resource positions find ways to develop resources that deliver the same value to customers in a different way:
 If not: company can probably achieve a temporary competitive advantage
 If yes: company’s outperformance is likely to be lost through substitution

18
Q

What is meant with hold-up under appropriation?

A

Are other actors involved in value creation process whose input is crucial and who can grant or withdraw support with less impact on themselves than on the company that owns the value creation process:
 If not: company can probably achieve a temporary competitive advantage
 If yes: company’s outperformance position is likely to be lost due to hold-up issue
Consider switching costs!!  Creates opportunities for opportunistic behavior

19
Q

What is meant with slack under appropriation?

A

Does company have a sober culture in which profits are passed to owners and shareholders while reinvestment comes from cost savings:
 If not: company’s outperformance is likely to be lost due to increasing slack
 If yes: company can probably achieve a temporary competitive advantage

20
Q

What is a catfish effect?

A

strong competitors cause weak competitors to better themselves and eradicate slack.

21
Q

Name two reasons companies need to keep innovation and reconfiguring resource positions?

A
  1. Shield against competition and value transfer
  2. Prevent regression-to-the-mean effect
22
Q

Name the four characteristics of the VRIN framework?

A
  1. Valuable: resource exploits opportunity/neutralizes a threat
  2. Rare: Resource must be rare among existing or potential competitors
  3. Inimitable: resource must be difficult to imitate
  4. Non-substitutable: strategically equivalent resources must be rare and/or imperfectly imitable
23
Q

Name three causes of VRIN resources?

A
  1. Unique historical circumstances
  2. Causal ambiguity
  3. Patents
24
Q

How can unique historical circumstances create VRIN resources?

A

historical circumstances allow companies to acquire/develop resources on very favorable terms, which cannot be imitated or replicated

25
How can patents create VRIN resources?
- Patents can prevent other companies from imitating company’s products until patent expiration - Loss of patent in pharmaceutical industry can lead to 90% loss of sales in two years
25
How can causal ambiguity cause VRIN resources?
- May be impossible for outsiders to understand real determinants of business success - Unaware of company’s real assets - Relationships between assets are socially and technologically complex
26
Name two perspectives on business strategy?
1. Resource perspective: - Core competencies, dynamic capabilities and VRIN criteria 2. Industry structure perspective - Competitive forces, industry transformation paths - Barriers to entry and mobility, reconfiguration options