N.B Unique resources: those which create competitive advantage and are difficult to imitate
Resource audit (Cont) Core competences Threshold competences COMPETENCES Unique resources Necessary resources RESOURCES Better than competitors and difficult to imitate Same as competitors or easy to imitate
Analysing competences and core competences Identifying competences Value chain analysis Organisational competences Bases of competences Cost efficiency Value added Managing linkages Robustness
Value chain analysis : ‘describes the activities within and around an organisation and relates them to an analysis of the competitive strengths of the organisation’.
Johnson & Scholes 1999, p.156.
The long-term competitive position of an organisation is concerned with its ability to sustain value-for-money products or services.
Need to consider primary activities and secondary activities
Firm infrastructure Human resource management Technology development Procurement Support activities Primary activities Margin Inbound logistics Operations Outbound logistics Marketing and sales Service Margin Exhibit 4.4 The value chain Source: Adapted from M. E. Porter, Competitive Strategy, Free Press, 1985. Used with permission of The Free Press, a division of Macmillan, Inc. Copyright 1985 Michael E. Porter
Core competences are likely to be more robust and difficult to imitate if they relate to the management of linkages within the organisation’s value chain and linkages into the supply and distribution chains.
Leverage : ‘is a measure of the improvement in performance through the management of linkages between separate resources and activities’.