Week2-Mission VRIO and Swot

7/27/2019 Week2-Mission VRIO and Swot

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TOPIC AREAS COVERED IN A CORPORATE MISSION

STATEMENT

1. Products or services provided

2. Customer needs to be met

3. Technology to be used

4. Survival, growth and profitability

5. Managements philosophy

6. The firms Self Concept

7. Public image and social responsibility


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FUNCTIONS OF A CORPORATE MISSION

STATEMENT

Ensure unanimity of purpose.

Motivating the use of the organizations resources

As a basis for allocating organizational resources

Setting a general tone or climate

As a focal point for the organizations identity

Aids in translating goals and objectives into a working

strategy

Specifies organizational purposes so they can be controlled.


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The Mission of Southwest Airlines

The Mission of Southwest Airlines isdedication to the highest quality of

Customer Service delivered with a sense

of warmth, friendliness, individual pride,and Company Spirit.


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To Our Employees

We are committed to provide our Employees a stable work

environment with equal opportunity for learning and personal

growth. Creativity and innovation are encouraged for improvingthe effectiveness of Southwest Airlines. Above all, Employees

will be provided the same concern, respect, and caring attitude

within the organization that they are expected to share externally

with every Southwest Customer.

-January 1988


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Internal analysis provides a comparativelook at a firms capabilities and helps

answer the following questions

Internal Analysis and its Roles


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What are the firms strengths?

What are the firms weaknesses? How do these strengths & weaknesses compare

to competitors?

Are resources and capabilities strengths and/or

weaknesses?

Are resources and capabilities likely sources of

competitive advantage?

Can the firm establish strategies that will exploit

any sources of competitive advantage


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The VRIO Framework

Four Important Questions:

Is the resource Valuable?

is the resource Rare?

Is the resource Imitable?

Can the Organization make use of it?


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Applying the VRIO Framework

The Question ofValue

in theory: Does the resource enable the firm

to exploit an external opportunity or neutralizean external threat?

the practical: Does the resource result in an

increase in revenues, a decrease in costs, or

some combination of the two? (Levis reputation

allows it to charge a premium for its Dockers pants)


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The Question ofRarity

a resource must be rare enough that perfect

competition has not set in

if a resource is not rare, then perfect competition

dynamics are likely to be observed (i.e., nocompetitive advantage, no above normal profits)

thus, there may be other firms that possess the

resource, but still few enough that there is scarcity

(several pharmaceuticals sell cholesterol-lowering

drugs, but the drugs are still scarcelook at prices)


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The Question ofImitability

the temporary competitive advantage of valuableand rare resources can be sustained only if

competitors face a cost or other in disadvantage

imitating the resource

intangible resources are usually morecostly to imitate than tangible resources

(Harley-Davidsons styles may be easily

imitated, but its reputation cannot)


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The Question ofImitability

Barriers to Imitation

Unique Historical Conditions (Caterpillar)

first moveradvantages

path dependenceCausal Ambiguity (Southwest Airlines)

causal links between resources and competitive

advantage may not be understood

Patents

offer a period of protection if the firm is

able to defend its patent

rights

required disclosure may actually decrease

the cost of imitation, and the timing


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Value, Rarity, & Imitability

If a firms resources are: The firm can expect:

Valuable, Rare, but

not Costly to Imitate

Temporary

Competitive Advantage

Valuable, Rare, and

Costly to Imitate

Sustained


(ifOrganized appropriately)


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Strengths

Internal


Distinctive Competence

Opportunities

External

Future Oriented

Niches

SWOT MATRIX

Weaknesses

Internal

Disadvantage

Area for Improvement

Threats

External

Vulnerability

Attack Point

Purposes

Qualitative Assessment of Current Condition

Competitor Assessment

Strategic What-if Analysis

Product to Business Unit to Corporate Analysis

Week2-Mission VRIO and Swot

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