how internal resources and capabilities can be a source of sustainable competitive advantage for a company Solution Ans:- Internal analysis is the process of identifying and evaluating an organization’s specific characteristics, including its: An internal analysis is comprised of looking at the following elements: Resources are the assets that an organization has for carrying out whatever work activities and processes relative to its business definition, business mission, and goals and objectives. Commonly, these resources are as follows: Organizational resources must be processed or used in some way to get value out of them. The various resources are the inputs for organizational capabilities. Organizational capabilities are the complex and coordinated network of organizational routines and processes that determine how efficiently and effectively the organization transforms its inputs (resources) into outputs (products and/or services). Sustainable competitive advantage is the prolonged maintenance of competitive advantage. Capabilities that lead to a competitive advantage today may not continue to do so as market conditions and competitors change. Dynamic (flexible) capabilities are an organization’s ability to build, integrate, and reconfigure capabilities to address rapidly environmental changes (shifts). Distinctive organizational capabilities are the extraordinary and unique capabilities that distinguish the organization from its competitors. They allow the organization to develop a sustainable competitive advantage to outperform its competition. Three characteristics that make a capability distinctive are as follows: Core competencies are the organization’s major value-creating skills and capabilities that are shared across multiple product lines or multiple businesses. This internal sharing process is what distinguishes core competencies from distinctive capabilities. The relationship between organizational capabilities, distinctive organizational capabilities, and core competencies are as follows: Competitive advantage is what sets an organization apart. Without a sustainable competitive advantage, the organization’s long-run success and survival are uncertain. The aggregate reason for doing an internal analysis is to assess what the organization has or does not have and what it can and cannot do—in other words, its strengths and its weaknesses. Strengths are resources that the organization possesses and capabilities that the organization has developed, both of which can be exploited and developed into sustainable competitive advantage. Not all strengths have the potential to be a sustainable competitive advantage..