Course 6 Internal Analysis PDF

28/12/2024 Frank Janssen 1 5. INTERNAL ANALYSIS Frank Janssen General frame Strategic Analysis Competitive environment Vision Mission Internal orga...

28/12/2024 Frank Janssen 1 5. INTERNAL ANALYSIS Frank Janssen General frame Strategic Analysis Competitive environment Vision Mission Internal organization Strategic Action Organizational Development choices implementation Performances Strategic capability Why are some firms more successful than others in the same sector? “Capability ”: what an organization can do. Some firms have specific ways of integrating resources and competencies Strategic capability: the way to integrate (globally) the resources and competencies It can be good for the organization: Source of value if it is valued by clients. Source of value if it provides an advantage over competitors Resources What a firm posesses Assets a firm uses to develop its activities Tangible Resources Intangible Resources * Financial * Technologies * Physical * Brand * Human Corporate culture * * Buildings  Competencies What a firm does Competencies represent: how the firm integrates its resources to reach an aim (project management; innovation management; just in time…) When competencies are combined in a unique way– it creates strategic capability that creates strategic value Typology of resources and competencies Identical to those of Better than those of competitors or easy to competitors or difficult to copy copy* Basic Unique RESOURCES COMPETENCiES Treshold Core The VRIN Model To develop a competitive advantage, the firm must have resources and competencies that are : Valuable (value for client) Rare Inimitable Non-Substitutable Barney (1991, 1997)  Four criteria that define strategic capability: Valuable R/C that are sources of value for clients Rare R/C that are only owned by a small number (or none) of competitors – real or potential Inimitable (or expensive to imitate) R/C that other firms cannot develop easily (because of complexity, …) Non-Substitutable R/C that have no strategic equivalent, possible substitutes  VRIN Analysis Non Competitive Economic Valuable Rare Inimitable substitutable Implication Implication No Disadvantage Below Normal Yes No Parity Normal Temporary Above Yes Yes No Advantage Normal Sustainable Above Yes Yes Yes Yes Advantage Normal Barney (1991, 1997)  Value Chain: identify the R&C that create value Infrastructure and systems HR M Support AR G Functions Technological development IN S M Services Production Logistics Marketing Supplies & sales S IN G AR M. Porter Primary Functions Examples Do a VRIN analysis of STIB UCL St Louis -Brussels Ben & Jerry’s LVMH McDonalds Apple Adidas Tesla Patagonia