Topic 5: Internal Analysis

Question 1

What do we mean by Resources?

Answer 1

• Anything that can be thought of as a Strength or Weakness of a firm (Wernerfelt, 1984)
• A bundle of assets, capabilities, organisational processes, firm attributes, information and knowledge (Barney, 1991)

Question 2

How do we perform Internal Analysis? (Internal Analysis Process)

Answer 2

1) Determine Resources, Assessment of current performance (strengths & weaknesses), Portfolio analysis
then
2)Strengths & Weaknesses
then
3)Assess against external environment, vision and intent to determine strategic options

Question 3

Assets

Answer 3

the resource endowments that the organisation has built over time such as those resulting from investments in scale, plant, location and brand

Question 4

Capabilities

Answer 4

• The processes enabling the assets to be deployed to the company’s advantage
• Core capabilities are important to creating CA and typically involve the bundling together of other capabilities

Question 5

Dynamic capabilities

Answer 5

• Capabilities that create new assets and or capabilities in response to changes in the marketplace
• “The firm’s ability to integrate, build, and reconfigure internal and external competences to address rapidly changing environments” Teece (1997)

Question 6

Dynamic Marketing Capabilities

Answer 6

Dynamic Marketing Capabilities are the ability to create new marketing resources to identify, respond to and exploit change

Question 7

Absorptive capabilities (Dynamic Marketing Capabilities)

Answer 7

Understanding what is happening in external market, generating and modifying routines

Question 8

Adaptive capabilities (Dynamic Marketing Capabilities)

Answer 8

Identify & capitalise on emerging market opportunities and capture new customers

Question 9

Innovative capabilities (Dynamic Marketing Capabilities)

Answer 9

Ability to innovate and develop new products/services

Question 10

Resource example - Zara

Answer 10

• Dynamic Capabilities: Market sensing - Established processes for quickly capturing and communicating feedback
• Core Capabilities: Responsiveness to customers

-Capabilities: Advanced information systems capability
Just In time production and stock control processes
In-house design and production

-Assets: Network of independent suppliers
Strong fast fashion brand
Network of stores in prime locations with high level of technology
Strong financial position

Question 11

Comparing the performance of a business component with others is called

Answer 11

benchmarking. The goal is to generate specific ideas for improvement, and also to define standards at which to aim”

Question 12

Portfolio Analysis – BCG Matrix

Answer 12

“Business portfolio analysis provides a structured way to evaluate business units on two key dimensions: the attractiveness of the market involved and the strength of the firms position” - Aaker and McLoughlin (2007:123)

Question 13

VRIO for Competitive Advantage

Answer 13

Value, Rareness, Imitability, Organization

VRIO is used to assess the situation inside the organization (enterprise) - its resources, their competitive implication and possible potential for improvement in the given area or for a given resource.

Question 14

Core competencies have three characteristics:

Answer 14

• Makes significant contribution to customer-perceived value
• It has applications in a wide variety of markets
• It is difficult for competitors to imitate

Question 15

Core Rigidities

Answer 15

“Capabilities can act as liability and that in certain situations (e.g., in dynamic environments) they can act as rigidities that keep firms from adapt and acting in ways that might be beneficial.” Barton, 1992

Question 16

Sticky Resources

Answer 16

“For a Barnes and Noble, its allocation of resources and the capabilities and the culture and the people that it has hired are all extremely sticky; it can’t really turn the ship around all that easily and certainly not very quickly. That’s what I mean by sticky resources..” Prof. Anil K Gupta,

Question 17

The Transformational Leadership Style

Answer 17

• Often identified as the single most effective style

- Focused on leaders’ ability to motivate and inspire followers and to direct positive changes in groups.

Question 18

The Transactional Leadership Style

Answer 18

• Typically involves the employer-employee relationship. The transaction focuses on the follower completing required tasks in exchange for monetary compensation.
• Creates clearly defined roles and motivates employees to receive rewards and also allows leaders to offer a great deal of supervision and direction
• However, can stifle creativity and out-of-the-box thinking.

Question 19

Situational Leadership Styles

Answer 19

-Situational theories of leadership stress the significant influence of the environment and the situation on leadership

Question 20

FINISH AFTER SLIDE 17

Answer 20

FINISH AFTER SLIDE 17

Question 21

What are Core Competencies

Answer 21

• Make significant contribution to customer-perceived value.
• it has application in a wide variety of markets
• it is difficult for competitors to immitate

Question 22

Power Culture (Handy’s 4 cultural types)

Answer 22

Dominance of an individual / small group who makes the key decisions and delegate tasks/responsibilities
Limited opportunity for employees to be heard

Question 23

Role Culture (Handy’s 4 cultural types)

Answer 23

Bureaucratic with clear role hierarchy
Rules based
Strong organisational pillars

Question 24

Task Culture (Handy’s 4 cultural types)

Answer 24

Individuals, often with mixed specializations are organized into teams to address particular projects

Question 25

Person Culture (Handy’s 4 cultural types)

Answer 25

Individuals are central
Organised around customer needs
E.g. Doctor, Lawyers, Architects Firms