INTERNAL ANALYSIS

Team BJames Akosah, Sanna Burton, Joseph Buyondo, Mohammed El Uharani, Linci Elvis,

Evgeni Kurten, Yaoyu Ma, Tikere Nhambo, Armando Pereira, Nora Uotila, Paulo Vieira, Laura Wild

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Content:-The Resource-Based Model –Gary Hamel–Resources, Capabilities and Competencies –Value Chain Analysis

Internal Analysis

definition:

A process of identifying and evaluating

an organizations specific characteristics

lnternal analysis focus on the current

situation; vision, mission, strategic

objectives and strategies to be able to

understand the needed changes.

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What is a Resource-Based Model:

A concept that:

Adopts an internal perspective

Firm’s are unique bundles of resources

Firm’s resources are most important in getting and keeping competitive advantage

Resources are any assets such as:

Financial (cash reserves, investments…)

Human (experience, knowledge, skills, abilities and competencies)

Physical (equipment, office buildings, manufacturing, raw material or any other intangible materials)

Intangible (Brand, patents, reputation, trademarks and databases)

What makes them ”unique”?

Valuable, allowing the company to exploit opportunities or neutralize the external environment.

Rare or possessed by few, if any current and potential competitors.

Hard to imitate such that other competitors cant or build same or obtain only at cost disadvantage.

Ability to exploit take full advantage of the resources to develop competitive advantage.

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Gary Hamel

Facebook Generation

Dr. Gary P. Hamel :American management expert.

Graduate of Andrews University (1975) and the Ross School of Business at the University of Michigan (1990).

Gary Hamel is the originator (with C. K. Prahalad) of the concept of core competencies

The Wall Street Journal recently ranked Gary Hamel as the world's most influential business thinker

His latest book, The Future of Management, was published by the Harvard Business School Press in October 2007 and was selected by Amazon.com as the best business book of the year

The internet and the business world are full of materials

regarding Gary Hamel. By this reason, is very hard to

choose one of his works only. His latest publishing is The

Future of Management, published by Harvard Business

School Press, in 2007. He became a Guru in the business

world and few persons have similar influence in this field as

him. To illustrate this report was chose a specific article

published by The Wall Street Journal, in March 24, 2009. In

the chosen article, Gary Hamel anticipates one more time

the future of management environment creating a list of, in

his opinion, what he called the Facebook Generation.

Following are listed the 12 characteristics of what Gary

Hamel has called the GenF.

All ideas compete on an equal footing

Contribution counts for more than

credentials

Hierarchies are natural, not prescribed

Leaders serve rather than preside

Tasks are chosen, not assigned

Groups are self-defining and -organizing Resources get attracted, not allocated Power comes from sharing information,

not hoarding it Opinions compound and decisions are

peer-reviewed Users can veto most policy decisions Intrinsic rewards matter most Hackers are heroes

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Organizational Capabilities

Organizational routines and processes

->Turning input, i.e. resources, into output

->Getting value out of the

resources

Turning captured value into

->Core competences

->Distinctive organizational capabilities

Gaining competitive advantage

Dynamic Organizational Capabilities

Tackling the challenges from changing environment

Sustainable competitive advantage

Ability to build, integrate and reconfigure capabilities

->Timely responsiveness

->Rapid and flexible product innovation

->Management expertise in coordinating and redeploying resources and capabilities

RReeResources

Assets for carrying out what ever work activities/processes the organization is doing in it’s business

Resources are the source of company’s competitive advantage

But more importantly determines the capabilities and core competencies

Resources alone are not productive->process

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Core Competencies and Distinctive Capabilities

Core competencies = any major value-creating capabilities organizations have that are essential to their business

Organizational capabilities are fundamental building blocks for developing core competencies

lf core competencies are established

->Can improve and enhance other organizational capabilities

->Can contribute to developing distinctive capabilities

->Leads to a competitive advantage

Distinctive organizational capabilities = special and unique capabilities that distinguish an organization from its competitors

Three characteristics:

Contributes to superior customer value

Is difficult for competitors to imitate

Can be used in a variety ofways

Value Chain Model

•Systematic approach to examining the development of competitive advantage

•Created by M. E. Porter-Competitive Advantage (1980).

•Activities that create and build value

–Primary activities and support activities

all together consist of activities that link together to develop the value of the business

Definition

• Primary activities

a)Inbound logistics

b)Operations

c)Outbound logistics

d)Marketing and sales

e)Service

•Support activities

a)Procurement

b)Human Resource Management

c)Technology Development

d)Firm Infrastructure

Value chain activities are not independent from one another. one value chain activity often affects the performance of other ones.

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InboundLogistics > Operations >

OutboundLogistics

>Marketing

&Sales

> Service >

MARGIN

Firm Infrastructure

HR Management

Technology Development

Procurement

Porter's Generic Value Chain 

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Steps in Value Chain Analysis

•Break down a market

•Assess the potential for adding value via cost advantage or differentiation,

•Determine strategies built around focusing on activities where competitive advantage can be sustained.

Cost Advantage and the Value Chain

•A firm may create a cost advantage,

–Reducing the cost of individual value chain activities or

– Reconfiguring the value chain.•cost drivers -value chain activities

–Economies of scale

–Learning Capacity

–utilization Linkages among activities.etc.

•Cost advantage: by better understanding costs and squeezing them out of the value-adding activities.

•Differentiation: core competencies and capabilities are the main objective of the activities so as to perform better than competitors do.

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