Chapter 3 - Resource and capabilities-based view

Question 1

What is a Resource?

Answer 1

Tangible and intangible assets a firm use to choose and implement its strategy

Question 2

What is Capabilities?

Answer 2

A firm’s capacity to dynamically deploy resources

Question 3

What are the three dynamic capabilities?

Answer 3

• Sensing (discover opportunities)
• Seizing (capture value from opportunities)
• Reconfiguration (remain flexible)

Question 4

What is the Value Chain?

Answer 4

Production through a chain of vertical activities that add value
=> primary and supporting activities

Question 5

What is Value Chain analysis and decision?

Answer 5

Examine if the firm has the resources and capabilities to perform an activity in a manner superior to competitors (benchmark)

Question 6

What is Outsourcing?

Answer 6

Outside supplier perform on behalf of the local firm
=> can focus on core business

Critics: strategic, economic, and political

Question 7

Explain the VRIO framework

Answer 7

Valuable
Rare
Imitable
Exploited by the Organization

Competitive disadvantage (below perf)
Competitive parity (average perf)
Temporary competitive advantage (above perf)
Sustained competitive advantage (consistently above perf)

Question 8

The four fundamental question in the resources-based view?

Answer 8

• Why do firms differ?
  => Heterogeneity
• How do firms behave?
  => Take advantage of S and overcome W
• Scope?
  => Performance relative to rivals
• Success or failure?
  => Firm specific resources and capabilities and a little luck