What are foundation of competitive advantage?
Neu-Ulm University of Applied Sciences
September 22, 2023
After this session, you should have a solid understanding of
Assessing a firm’s strengths and weaknesses so that strategies can be formulated that capitalize on internal strengths and overcome weaknesses.
Key internal areas/resources an internal assessment should focus on:
Tangible resources, intangible resources, organizational capabilities, competitive assets, culture & values, knowledge management, strategic flexibility, and technology.
Culture eats strategy for breakfast. Peter Drucker, Management consultant, educator and author
The most brilliant strategies can fail if they are not congruent with the prevailing culture within an organization. Successful organizations, thus, integrate culture and strategy.
Form small groups of 3 to 4 students, discuss what you have learned about the resource-based view (RBV) from reading Peteraf (1993). Create a brief summary of the key tenets of the RBV (one slide) and derive key implications for strategic management (15 minutes).
Be prepared to present your findings in a five-minute presentation.
The RBV contends that internal resources are critical for achieving and sustaining competitive advantage, even more important than the environment.
Questions of value, rareness, imitability/substitutability (VRIN), and organisation must be addressed.
Dynamic capabilities refer to a firm’s ability to integrate, build, and reconfigure internal and external resources to address rapidly changing environments (Teece, Pisano, and Shuen 1997).
Sensing,
(identifying and assessing opportunities)
seizing,
(mobilizing your resources to capture value from those opportunities)
and transforming
(continuous renewal)
Can you give a compelling illustration of dynamic capabilities in action?
Steps in using the SWOT framework:
Form small groups and identify real-life examples for each strategy type (SO, WO, ST, WT). Show how the strategies match with the related internal and external factors.
The following questions are designed to review and consolidate what you have learned and are a good starting point for preparing for the exam.
Read Mintzberg (1978) and make notes on following questions: