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Strategic Management > Ch. 4 Internal Analysis > Flashcards

Ch. 4 Internal Analysis Flashcards

1
Q

Define internal analysis

A

the process of evaluating an organization’s resources and capabilities.

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2
Q

What are the assets/resources an organization has?

A
  • physical
  • financial
  • human
  • intangible
  • structural-cultural
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3
Q

Give examples of financial resources

A
  • debt capacity
  • credit lines
  • available equity (stock)
  • cash reserves
  • other financial holdings
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4
Q

Give examples of physical resources

A
  • buildings
  • equipment and fixtures
  • raw materials
  • office supplies
  • manufacturing facilities
  • machines
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5
Q

What are human resources?

A

experiences, knowledge, judgment, skills, accumulated wisdom, and competencies of the organization’s employees

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6
Q

What are intangible resources?

A
  • brand names
  • patents
  • trademarks
  • databases
  • copyrights
  • registered designs,
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7
Q

What are structural-cultural resources

A
  • organizational history
  • culture
  • work systems
  • policies
  • relationships
  • organizational structure
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8
Q

What are organizational resources?

A

An organization’s resources are the inputs needed to perform its work

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9
Q

How do organizational resources become core competencies or distinctive capabilities?

A

Organizational members do their work using organizational resources and routines and processes, they learn how best to capture the value of these resources

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10
Q

What are core competencies

A

Major value-creating capabilities that are essential to the business

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11
Q

How are core competencies created?

A

Any core competencies of an organization are created out of:

  • routines and processes
  • accumulated knowledge
  • actual work activities
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12
Q

Define “distinctive organizational capabilities”

A

Unique capabilities that distinguish an organization from its competitors

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13
Q

What are the 3 characteristics of distinctive organizational capabilities

A
  1. Contributes to superior customer value
  2. Difficult to imitate by competitors
  3. Can be used in a variety of ways
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14
Q

What is competitive advantage and where does in stem from?

A

It’s what sets an organization apart and comes from an organization’s unique resources or from its distinctive capabilities

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15
Q

What are 3 broad categories value can come from?

A
  • The product is unique (differentiation)
  • The product is low cost (cost)
  • The product meets customer needs quickly and efficiently (service)
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16
Q

What are primary activities in the value chain?

A

Primary activities are those that create customer value. These are:

  1. inbound logistics
  2. operations
  3. outbound logistics
  4. marketing & sales
  5. service
17
Q

What are the support activities in the value chain?

A

Support activities aid the primary activities in creating customer value. They are:

  1. Firm infrastructure
  2. Human resource
  3. Technology
  4. Procurement
18
Q

What’s the internal audit approach based on?

A

Every organization has a function to perform. And these can either be performed well or poorly.

19
Q

What is an internal audit?

A

An internal audit is a thorough assessment of an organization’s internal areas. It focuses on the availability or lack of critical resources and the level of capabilities.

The audit areas are:

  1. productions-operations
  2. marketing
  3. R&D
  4. financial-accounting
  5. management
  6. information systems

Organizational elements of focus:

  1. strategic managers
  2. organizational structure
  3. organizational culture
20
Q

What are the 3 ways you can do an internal analysis?

A
  1. value chain analysis
  2. internal audit
  3. capabilities assessment profile
21
Q

How do you perform a capabilities assessment?

A
  1. Identify distinctive capabilities

2. Develop and leverage them

22
Q

What does the current-market profile consist of?

A
  1. what are you selling?
  2. who are you selling to?
  3. are you providing customer value?
23
Q

What are the 5 steps in identifying/assessing an organization’s distinctive capabilities?

Internal audit method.

A
  1. create a current-market profile
  2. identify sources of competitive advantage/disadvantage
  3. describe all capabilities & competencies
  4. sort them according to strategic importance
  5. identify and agree on key capabilities and competencies
24
Q

What are 3 criteria to determine if core capability/competencies are strategically important?

A
  1. Does it provide tangible customer benefits?
  2. is it difficult for competitors to imitate?
  3. Does it provide access to different markets?
25
Q

Why is the capabilities assessment profile not suitable to lower level managers?

A

it requires assessing a vast number of underlying organizational capabilities that don’t always fit nicely and neatly into narrowly defined specific functional areas.

26
Q

What are the 4 criteria to determine strengths and weaknesses?

A
  1. past performance trends
  2. actual performance vs. specific performance goals
  3. compare against competitors
  4. personal opinions of strategic decision-makers
27
Q

Why is an internal analysis importanat?

A

Two reasons:

  1. It’s the only way to identify strengths and weaknesses
  2. It’s needed for strategic decision-making
28
Q

What is a value chain analysis?

A

a systematic way of examining all the organization’s functional activities and how well they create customer value.

Strategic Management (13 decks)

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