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STRATEGIC MANAGEMENT & BUSINESS POLICY11TH EDITION

THOMAS L. WHEELEN J. DAVID HUNGER

CHAPTER 5Internal Scanning: Organizational Analysis

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Resource-Based Approach to Organizational Analysis

Internal strategic factors --

–Critical strengths and weaknesses that are likely to determine if the firm will be able to take advantage of opportunities while avoiding threats

•Resources•Capabilities•Competency•Core competency•Distinctive competency

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Core and Distinctive Competencies

VRIO Framework --

–Value

–Rareness

–Imitability

–Organization

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Resource-Based Approach to Organizational Analysis

5-Step Approach Strategy Analysis --

1. Identify and classify resources2. Combine strengths into capabilities3. Appraise profit potential of capabilities4. Select strategy that best exploits 5. Identify resource gaps invest in weaknesses

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Continuum of Sustainability

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Sustainability of Advantage

Durability --

–Rate at which a firm’s underlying resources and capabilities depreciate or become obsolete

Imitability --

–Rate at which a firm’s underlying resources and capabilities can be duplicated by others

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Sustainability of Advantage

Core Competency can be imitated --

–Transparency–Transferability–Replicability

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Business Models

Company’s method for making money in the current business environment.

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Business Models

Types of Models --

–Customer Solutions Model–Profit Pyramid Model–Multi-Component System/Installed Base Model–Advertising Model–Switchboard Model

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Business Models

Types of Models --

–Time Model–Efficiency Model–Blockbuster Model–Profit Multiplier Model–Entrepreneurial Model–De Facto Standard Model

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Value-Chain Analysis

Typical Value Chain for a Manufactured Product

Linked set of value-creating activities beginning with basic raw material and ending with distributors getting final goods into hands of customers

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Corporation’s Value Chain

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Scanning Functional Resources & Capabilities

Basic Organizational Structures --

–Simple structure–Functional structure–Divisional structure–Strategic business units (SBU’s)–Conglomerate structure

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Basic Organizational Structures

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Corporate Culture

Collection of beliefs, expectations, and values learned and shared by a corporation’s members and transmitted from one generation of employees to another

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Strategic Marketing Issues

–Market Position & Segmentation–Marketing Mix–Product Life Cycle–Brand & Corporate Reputation

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Product Life Cycle

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Strategic Financial Issues

–Financial leverage

–Capital budgeting

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Strategic Research & Development Issues

–R&D Intensity

–Technological Competence

–Technology Transfer

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Technological Discontinuity

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Strategic Human Resource Management Issues

HRM –

–Increasing use of teams–Union relations –Temporary workers–Quality of work life–Human diversity

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Internal Factor Analysis Summary Table