Please enable JavaScript.
Coggle requires JavaScript to display documents.
Analysing the internal environment - Coggle Diagram
Analysing the internal environment
Organisations seek out advantages over their rivals to win business and compete
Advantages tend to be clustered into those the make the organisation more efficient and drive down costs, differentiate their offerings and add more value in the eye of the customer or enable the organisation to provide its products and services in a more responsive and timely manner
Organisations realised that such advantages were not enduring when a competitor could imitate them or even acquire the same sort of advtnage
A sustainable competitive advantage is an advantage over a customer such as lower cost, a better product or quicker delivery that is not easily imitated
An organisation's competitiveness derives from its core competencies and core products which are the tangible result of core competencies
The resource based view is a strategic approach that priorities the capability of the firm
It is a model of firm performance that focuses on the resources and capabilities controlled by a firm as sources of competitive advantage
Capabilities describe what the organisation can do - they are an organisations distinctive competencies to do something well and effcicinetly
Competence refers to work related knowledge, skill or ability held by the organisation
Core competence is collective learning in the organisation such as the capacity to co-ordinate diverse production skills and integrate streams of technologies
Each firm has a small number of specific things that it can do well and these differ from other organisations
Organisations analyse their international operations to understand how they are adding value, meeting customer wants and needs and competitng
Organisations evaluate their competencies, capabilities, resources and the extent to which these are helping them attain goals and demands of their target market in a manner that exceeds rivals
Strategic capability
These competencies and resources combine to form the strategic capability of the organisation ensuring long term growth and survival of the firm
Resources and competencies are important but it is the fit between the two that contributes towards competitive advantage
There is no value in possessing state of the art equipment if staff are unable to operate it efficiently
There is no point in having a customer relationship marketing database if no one within sales or marketing uses it
Increasingly the systems, processes, relationships and human networks of organisations are being called upon to enhance the competitive advantage that the competitive advantage that the physical, human and financial resources of the organisation provide
The adequacy and suitability of the resources and competencies of an organisation required for it to survive and prosper
Analysing strategic capabilities and core competencies
Resources and competencies combine to create the capabilities of the organisation which can be split into threshold capabilities and distinctive capabilities
Threshold capabilities are important but do not in themselves provide a competitive advantage as they are not the basis for superior performance in a organsiation, thy are needed to operate and the capabilities that allow the organisation to survive in that market
Distinctive capabilities can be a source of competitive advantage and can lead to the superior performance
Distrincive capabilities are of value to customers and are hard for competitors to replicate, they are more likely to be a bundle of resources and competencies, very often the linkages can obtain distrincivessnes or fit between the various elements of the bundles
Flexible organisations with motivated staff will be able to take advantage of these linkages to reduce cost, improve efficiency or provide enhanced customer satisfaction
These distinctive capabilities may be unique and so as long as they create customer value they will create a competitive advnatage
Competitor organisations find these distinctive capabilities very hard to imitate