02 Strategic Positioning: Outside-in & Inside-out Analyses Flashcards
Paths to competitive advantage: Outside-in vs Inside-out
External Analysis:
- Industry Boundaries
- Opportunities vs Threats
- Environmental Models of Competitive Advantage
Internal Analysis:
- Firm Boundaries
- Strengths vs Weaknesses
- Resource-Based Models of Competitive Advantage
(OI) Outside-In - Layers
(OI) PESTEL (Macro Environment Analysis)
(OI) The macro-environment: Relevance of the political dimension
(OI) PESTEL Application
(OI) Porter’s Five Forces Framework
(OI, P5) Competitive Rivalry
cf. Apple vs Samsung
(OI, P5) Suppliers: Bargaining Power of Suppliers
cf. Football players
(OI, P5) Buyers: Bargaining power of buyers
cf. Power of Airline Customers (Buyers) towards Airlines
(OI, P5) Substitutes: The threat of substitutes
(OI, P5) New entrants: The threat of entry
(OI, P5) Challenges of using the Five-Forces model
(OI, P5) A dynamic view: The industry life cycle
(OI) Market & Customer Segment
Def.: group of customers w/ similar needs different from customer needs in other parts of the market
(OI, CM) Digital natives enter traditional industries –> Consequence?
(IO) Inside-Out Analysis – Framework
competitive advantages and better performance of an organization can be explained by the uniqueness of the resources and competencies of an organization
(IO) Resources vs Capabilities
(IO) VRIO Concept
Capabilities…
- Value:
… create product/service of value to customers + higher revenues and/or lower costs - Rare
… possessed uniquely by one organization or by few others - Inimitable
… competitors find difficult and costly to imitate/obtain/substitute - Organisation…
… must be suitably organised to support these capabilities
(IO VRIO) Criteria for the inimitability of competencies
(IO VRIO) From capability to core competence: the VRIO concept
(IO DC) Dynamic Capabilities (Def.)
& The 3 Generic Types of Dynamic Capabilities
- Def.: An organization’s ability to renew & recreate its resources + capabilities to meet the needs of changing environments
(IO VC) Value Chain (Def.) & Value Chain Model (Arrow)
- Def.: Describes the categories of activities within & around an organisation that together create products or services
(IO VC) What to use the value chain for?
- Generic description of activities
- Analysing the competitive position of the organisation using the VRIO criteria
- Analysing the cost and value of activities of an organisation
- Crucial value activities
- Cost versus strategic impact
- Where and how can costs be reduced?
(IO AS) Activity Systems (Def.)
- Def.: describe the way in which an organisation meets the critical success factors that determine the industry and lead to success
(cf. IKEA example)
