Resources and capabilities Flashcards
What is a resource?
What we have; Assets that organisationshave or can call upon - like cash flow
What are capabilities?
What we do well - How do you use those assets - like motivating personnel
What does threshold capabilities mean? (qualifiers) - Samsung, Xiaomi etc.,
Needed for an organisation to meet the necessary requirements to compete in a given market and achieve parity with competitors in that market
What does Distinctive capabilities mean? (winners) - Apple
Required to achieve competitive advantage. Valued by customers and which competitors find difficult to imitate.
in order to assess a company’s capabilities which will be the basis of achieving a sustainable competitive advantage you use:
the VRIO MODEL
Value from VRIO model stands for:
Value of resources & capabilities;Strategic capabilities are of value when they:
* take advantage of opportunities & neutralise threats;
* provide value to customers;
* are provided at a cost that still allows an organisation to make an acceptable return
Rarity from VRIO model stands for:
Rare capabilities;
Rare capabilities are those possessed uniquely by organisation OR only by a few others;
* Rarity can be temporary.
inimitability from VRIO model stands for:
Inimitable capabilities are those that competitors find difficult & costly to imitate, to obtain OR to substitute.
Organisational Support from VRIO model stands for:
The organisation must be suitably organised to support the valuable, rare & inimitable capabilities that it has.
* This includes appropriate processes & systems.
What is Benchmarking?
A means of understanding how an organisation compares with others –typically competitors.
The approaches to benchmarking are:
- Industry/sector = comparing performance against other organisations in the same industry/sector against a set of performance indicators.
- Best-in-class benchmarking = comparing an organisation’s performance or capabilities against ‘best-in-class’ performance –wherever that is found even in a very different industry.
What is Dynamic Capabilities?
The means by which an organisation has the ability to renew & recreate its strategic capabilities to meet the needs of changing environments
What is specific with the Dynamic Capabilities?
Such capabilities are distinct from ordinary capabilities
that may be necessary to operate efficiently now but that
may not be sufficient to sustain superior performance in
the future.
Generic dynamic capabilities are:
Sensing capabilities (“look for opportunities”)
Seizing capabilities (“seize opportunities”)
Reconfiguring capabilities (“renew in order to seize opportunities”)
Innovation dilemmas:
PRODUCT INNOVATION: relates to the final product (or service) to be sold, especially with regard to its features.
PROCESS INNOVATION: the way in which a product is produced and distributed, especially with regard to improvements in cost or reliability.
OPEN INNOVATION is about people working together, Exchanging ideas openly is seen as likely to produce better products more quickly.
CLOSED INNOVATION relying on the organisation’s own internal resources –its own laboratories and marketing departments.
TECH PUSH: there is some technology created by scientists and we are pushing it into the market.
MARKET PULL: consumers in the market are the ones that are responsible for innovation.
