Chapter 4 Flashcards
PUT TABLE 4.2 The VRIO framework: Is a resource or capability on notecard for exam!!
exam prep
SWOT analysis
A tool for determining a firm’s strengths (S), weaknesses (W), opportunities (O), and threats (T)
Resource
The tangible and intangible assets a firm uses to choose and implement its strategies
Capability
The tangible and intangible assets a firm uses to choose and implement its strategies
Tangible resource and capability
Assets that are observable and easily quantified
Intangible resource and capability
Assets that are hard to observe and difficult (if not impossible) to quantify
Sensing
Abilities to discover opportunities
Seizing
Abilities to capture value from opportunities
Reconfiguration
Abilities to remain flexible by redesigning business models, realigning assets, and revamping routines
Value chain
A stream of activities from upstream to downstream that add value
Benchmarking
Examining whether a firm has resources and capabilities to perform a particular activity in a manner superior to competitors
Commoditization
A process of market competition through which unique products that command high prices and high margins gradually lose their ability to do so, thus becoming commodities
Offshoring
Outsourcing to an international or foreign firm
Onshoring
Outsourcing to a domestic firm
Captive sourcing
Setting up subsidiaries abroad so that the work done is in-house but the location is foreign; also known as foreign direct investment (FDI)
VRIO framework
A resource-based framework that focuses on the value (V), rarity (R), imitability (I), and organizational (O) aspects of resources and capabilities
Causal ambiguity
The difficulty of identifying the actual cause of a firm’s successful performance
Complementary asset
The combination of numerous resources and assets that enable a firm to gain a competitive advantage
Social complexity
The socially intricate and interdependent ways that firms are typically organized
Reverse innovation
An innovation that is first adopted in other countries and is then diffused to the home country and the rest of the world
Business process outsourcing (BPO)
Outsourcing business processes to third-party providers
Original equipment manufacturer (OEM)
Firm that executes design blueprints provided by other firms and manufactures such products
Original design manufacturer (ODM)
Firm that both designs and manufactures products
Original brand manufacturer (OBM)
Firm that designs, manufactures, and markets branded products
Reshoring
Moving formerly offshored activities back to the home country of the local firm
Additive manufacturing (3D printing)
Manufacturing three-dimensional products from a digital model by using additive processes, where products are created by adding successive layers of material; This contrasts traditional manufacturing, which can be labeled “subtractive” processes centered on removing material by methods such as cutting and drilling
Servitization
Smart combination of manufacturing and services
