Please enable JavaScript.
Coggle requires JavaScript to display documents.
SMMCG1[BS-3b] Internal Analysis and Competitive Advantage, G1 (Vivianna,…
SMMC
G1
[BS-3b] Internal Analysis and Competitive Advantage
Durability & relecance
relevance
changing sources of competitive advantage
durability
attempt to plug the leaks
retain your people
preserve resources
maintain activity system
Risks towards a company's internal strength
degradation of resources
routine loss
departure of key employees
deterioration of capabilities
Managerial concern for durability and relevance
managers recognize the need to sustain their competitive advantage in a constantly changing business environment.
imitation and replication barriers
highlighted a specific built-‐in barrier to imitation
within the value chain or value network
Michael Porter
inherently difficult for other firms to replicate
• which activities are used,
• how they are implemented,
• and how they are combined
the value chain and value network approaches to internal analysis
often do not isolate mechanisms separately
the built-in imitation barrier is valuable for
strategic managers to consider
the imitation barriers are deliberately
Four Potential Challenges
Replication
replication
is achieving
similar results
using different processes.
Imitation
Imitation
refers to other firms
implementing
the
same product
development processes and routines
To
prevent
imitation and replication, and to
ensure
durability and relevance of their internal strengths.
Non-durability
Essential threats
to the firm's ability to continue
creating value
and
producing economic value added.
Non-relevance
the important identification and application of isolation mechanisms
Possible ways in which competitors may imitate or replicate
enticing a company's key resources
suppliers
application developers of partners
talented employees
Establishing barriers to restrict the flow of resources
effective barrier to imitation and replication
property rights over resources
intangible resources
trademarks
cover its brands and logos
copyrights
over software and other creative content
patents
on its various technologies
Protecting the proprietary rights of the company's resources
the most commonly used way to prevent imitation
VRI framwork
V
Valuable
example:
Highly Skilled Employees
V
Advanced Technology and Equipment
Unique Technology
R
Isolating mechanisms
Patents
Trademarks
Copyrights
Brand Reputation
Unique Culture
Exclusive Access to Raw Materials
Knowledge and Expertise
I
Unique Business Model
R
Rare
I
Inimitable
Jay Barney
G1
Vivianna
Susan
Thet Thet
Brianna
Tim
Lee
Ellen
Michael
isolating mechanisms
Tacit knowledge
knowledge that can't be easily explained and transferred to another
learned-by-doing
Complexity
Can't get every element of the activity system right
Causal ambiguity
The exact company's performance advantage is unclear
Time compression diseconomies
Property rights
often challenging for rivals to know precisely
• some causal ambiguity
• tacit knowledge
Complexity Argument
Conclusion
Key Ideas
Competitive advantage
Firm-effects
Company performance
Three key ways to analyze
activities
resources
capabilities
to have competitive advantage
sources create economic value
be rare
Challenges to maintaining
Barriers to imitation and replication
Continued creation of economic value
Ensure the activities, resources and capabilities
remain durable and relevant