1. Prentice Hall, Inc. © 20065-1 STRATEGIC MANAGEMENT & BUSINESS POLICY 10 TH EDITION THOMAS L. WHEELEN J. DAVID HUNGER CHAPTER 5 Internal Scanning: Organizational Analysis

2. Prentice Hall, Inc. © 20065-2 Resource-Based Approach to Organizational Analysis Internal strategic factors -- –Critical strengths and weaknesses that are likely to determine if the firm will be able to take advantage of opportunities while avoiding threats

3. Prentice Hall, Inc. © 20065-3 Resource-Based Approach to Organizational Analysis Resources Capabilities Competency Core competency Distinctive competency

4. Prentice Hall, Inc. © 20065-4 Core and Distinctive Competencies VRIO Framework -- –Value –Rareness –Imitability –Organization

5. Prentice Hall, Inc. © 20065-5 Resource-Based Approach to Organizational Analysis 5-Step Approach Strategy Analysis -- 1.Identify and classify resources 2.Combine strengths into capabilities 3.Appraise profit potential of capabilities 4.Select strategy that best exploits 5.Identify resource gaps invest in weaknesses

6. Prentice Hall, Inc. © 20065-6 Continuum of Sustainability

7. Prentice Hall, Inc. © 20065-7 Sustainability of Advantage Durability -- –Rate at which a firm’s underlying resources and capabilities depreciate or become obsolete

8. Prentice Hall, Inc. © 20065-8 Sustainability of Advantage Imitability -- –Rate at which a firm’s underlying resources and capabilities can be duplicated by others

9. Prentice Hall, Inc. © 20065-9 Sustainability of Advantage Core Competency can be imitated -- –Transparency –Transferability –Replicability

10. Prentice Hall, Inc. © 20065-10 Business Models Company’s method for making money in the current business environment.

11. Prentice Hall, Inc. © 20065-11 Business Models Types of Models -- –Customer Solutions Model –Profit Pyramid Model –Multi-Component System/Installed Base Model –Advertising Model –Switchboard Model

12. Prentice Hall, Inc. © 20065-12 Business Models Types of Models -- –Time Model –Efficiency Model –Blockbuster Model –Profit Multiplier Model –Entrepreneurial Model –De Facto Standard Model

13. Prentice Hall, Inc. © 20065-13 Value-Chain Analysis Linked set of value-creating activities beginning with basic raw material and ending with distributors getting final goods into hands of customers

14. Prentice Hall, Inc. © 20065-14 Value-Chain Analysis Typical Value Chain for a Manufactured Product

15. Prentice Hall, Inc. © 20065-15 Corporate Value-Chain Analysis Primary activities Support activities

16. Prentice Hall, Inc. © 20065-16 Corporation’s Value Chain

17. Prentice Hall, Inc. © 20065-17 Scanning Functional Resources & Capabilities Basic Organizational Structures -- –Simple structure –Functional structure –Divisional structure –Strategic business units (SBU’s) –Conglomerate structure

18. Prentice Hall, Inc. © 20065-18 Basic Organizational Structures

19. Prentice Hall, Inc. © 20065-19 Corporate Culture Collection of beliefs, expectations, and values learned and shared by a corporation’s members and transmitted from one generation of employees to another

20. Prentice Hall, Inc. © 20065-20 Strategic Marketing Issues –Market Position & Segmentation –Marketing Mix –Product Life Cycle –Brand & Corporate Reputation

21. Prentice Hall, Inc. © 20065-21 Product Life Cycle

22. Prentice Hall, Inc. © 20065-22 Strategic Financial Issues –Financial leverage –Capital budgeting

23. Prentice Hall, Inc. © 20065-23 Strategic Research & Development Issues –R&D Intensity –Technological Competence –Technology Transfer

24. Prentice Hall, Inc. © 20065-24 Technological Discontinuity

25. Prentice Hall, Inc. © 20065-25 Strategic Human Resource Management Issues HRM – –Increasing use of teams –Union relations –Temporary workers –Quality of work life –Human diversity

26. Prentice Hall, Inc. © 20065-26 Internal Factor Analysis Summary Table