Internal Analysis<br />TEAM B<br />
Agenda	<br />Gary Hamel & C.K. Prahalad<br />The Resource-Based Model<br />Resources, Capabilities and Core Competencies<b...
Gary HamelC.K. Prahalad<br />NicolòRavina<br />Satu Kukkonen-Omar<br />
American management expert<br />Born 1954 in USA<br />Graduate of Andrews University (1975) and the Ross School of Busines...
Originator of Corecompetenciestogether with C.K Prahalad<br />Fortune Magazine called him “the world’s leading expert on b...
Father of the concept of Core competency<br />Born 1941 in India<br />Studied Physics at university before working for Uni...
Prahalad was co-founder and became CEO of PrajaInc<br />Many of his ideas on competitive analysis argue against the suprem...
The Resource-Based Model<br />Philipp Vejchoda<br />Eva Wottge<br />Julie Couderc<br />
The Resource-Based Model<br />Inside-Out approach – starting point is the internal environment<br />Alternative perspectiv...
Resources<br />Definition<br />Resources are inputs that enable an organization to carry out its activities<br />Confer no...
Competencies<br />Definition:<br />Competenciesareattributesthat firms require in order to be able to compete in the marke...
Core Competencies<br />Definition:<br />A cluster of attributes that an organization possesses which in turn allows to ach...
Case Study Toyota<br />Toyota Priusrepresentscorecompetenceof Toyota<br />masterfuel-savingtechnologies in a fasterwaythan...
DistinctiveCapabilities<br />Definition:<br />Are important in providing an organizationwithcompetitiveadvantage<br />Deri...
Case Study Apple<br />Organizationalarchitecture<br />Innovation<br />Reputation<br />!!Your turn!!<br />15<br />
GRANT’s model (1991)<br />-   Capabilities are the main source of competitive advantage<br /><ul><li>They are about abilit...
He propose a strategy formulation in 5 stages:
>Identify and classify resources
>Identify capabilities
>Appraise rent-generating of resources and capabilities by their potential for sustainable competitive advantage and appro...
>Exploits resources and capabilities relative to the external environment
>Identify whether any resource gaps exist which need to be filled</li></ul>16<br />
17<br />
Identify Sustainable Competitive Advantage<br />To obtain a sustainable competitive advantage a company has to improve a v...
Resources, Capabilities and Core Competencies<br />Mikaela Rimaila<br />Riitta Varhelo<br />
Strategic role<br />20<br />
Strategic role<br /><ul><li>Canbeused in varietyways
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Internal analysis final_version

  1. 1. Internal Analysis<br />TEAM B<br />
  2. 2. Agenda <br />Gary Hamel & C.K. Prahalad<br />The Resource-Based Model<br />Resources, Capabilities and Core Competencies<br />Value Chain Analysis<br />2<br />
  3. 3. Gary HamelC.K. Prahalad<br />NicolòRavina<br />Satu Kukkonen-Omar<br />
  4. 4. American management expert<br />Born 1954 in USA<br />Graduate of Andrews University (1975) and the Ross School of Business at the University of Michigan (1990)<br />Started his working life as a hospital administrator<br />Has worked for companies as General Electric, Time Warner, Nokia, Nestle, Shell, Best Buy, Procter & Gamble, 3M, IBM, and Microsoft<br />Gary Hamel-Background<br />4<br />
  5. 5. Originator of Corecompetenciestogether with C.K Prahalad<br />Fortune Magazine called him “the world’s leading expert on business strategy” ‘<br />Pioneering concepts such as “strategic intent,” “core competence,” “industry revolution,” and “management innovation” have changed the practice of management in companies around the world. <br />Gary Hamel - Landmarks<br />5<br />
  6. 6. Father of the concept of Core competency<br />Born 1941 in India<br />Studied Physics at university before working for Union Carbide chemicals company<br />Wrote Doctoral thesis at Harvard Business school<br />Professor at University of Michigan where he met Gary Hamel<br />In 1993 the Wall Street Journal named him as one of the top ten teachers in the world<br />In 1994 received an award from Indo-American Society for promoting goodwill between India and the United States<br />C.K. Prahalad - Background<br />6<br />
  7. 7. Prahalad was co-founder and became CEO of PrajaInc<br />Many of his ideas on competitive analysis argue against the supremacy of traditional strategic thinking<br />Focus on the concepts of “Core competence”, “strategic intent” and “the bottom of the pyramid”<br />The book Fortune at the bottom of the pyramid was voted top business book of the year 2004 by www.amazon.com<br />C.K. Prahalad - Landmarks<br />7<br />
  8. 8. The Resource-Based Model<br />Philipp Vejchoda<br />Eva Wottge<br />Julie Couderc<br />
  9. 9. The Resource-Based Model<br />Inside-Out approach – starting point is the internal environment<br />Alternative perspective to Outside-In approaches such as Porter’s 5 forces<br />Resource-Based View emphasizes the internal capabilities of the organization in formulating strategy to achieve a sustainable competitive advantage<br />Internal capabilities determine the strategic choices a company makes in competing in the external environment<br />9<br />
  10. 10. Resources<br />Definition<br />Resources are inputs that enable an organization to carry out its activities<br />Confer no value to companies – only when they are put to some productive use the value follows<br />Tangible ResourcesPhysical assets that a company possesses like plants and machinery, finance and human capital<br />Intangible ResourcesRoutines and practices that have developed over time within an organization including reputation, culture, knowledge, brands<br />10<br />
  11. 11. Competencies<br />Definition:<br />Competenciesareattributesthat firms require in order to be able to compete in the marketplace<br />Prerequisite to compete within an industry<br />Competencies themselves do not confer any competitive advantage for the organization<br />11<br />
  12. 12. Core Competencies<br />Definition:<br />A cluster of attributes that an organization possesses which in turn allows to achieve competitive advantage<br />Derive from collective learning of individual members within an organization<br />Associated with Organizational Learning<br />They should<br />Provide access to a wide variety of markets (Honda’s engine desing and production)<br />Make a significant contribution on the customer benefits (BMW engineering capabilites)<br />Be difficult to imitate for competitors<br />12<br />
  13. 13. Case Study Toyota<br />Toyota Priusrepresentscorecompetenceof Toyota<br />masterfuel-savingtechnologies in a fasterwaythanrivals<br />hopeforcuttingcostsfortheenginetothe half<br />Effect on competitors:<br />jump on thishypeand<br />play catch meifyoucan (iftheywanttoor not)<br />13<br />
  14. 14. DistinctiveCapabilities<br />Definition:<br />Are important in providing an organizationwithcompetitiveadvantage<br />Derivefrom 3 areas<br />An organization‘sarchitecture (internal, external, networks)<br />Innovation and<br />Reputation<br />14<br />
  15. 15. Case Study Apple<br />Organizationalarchitecture<br />Innovation<br />Reputation<br />!!Your turn!!<br />15<br />
  16. 16. GRANT’s model (1991)<br />- Capabilities are the main source of competitive advantage<br /><ul><li>They are about ability to coordinate resources i.einputs (as capital, human resources, brands, financial)
  17. 17. He propose a strategy formulation in 5 stages:
  18. 18. >Identify and classify resources
  19. 19. >Identify capabilities
  20. 20. >Appraise rent-generating of resources and capabilities by their potential for sustainable competitive advantage and appropriability of their returns
  21. 21. >Exploits resources and capabilities relative to the external environment
  22. 22. >Identify whether any resource gaps exist which need to be filled</li></ul>16<br />
  23. 23. 17<br />
  24. 24. Identify Sustainable Competitive Advantage<br />To obtain a sustainable competitive advantage a company has to improve a valuable strategy that its competitors will unable to duplicate. Barney (1991)<br />To be sustainable, a competitive advantage need to achieve those 4 features:<br /> > Valuable <br /> > Rare<br /> > Difficult to imitate i.e unique location, path dependency, usual ambiguity and social complexity<br /> > No strategic substitute for this product<br />18<br />
  25. 25. Resources, Capabilities and Core Competencies<br />Mikaela Rimaila<br />Riitta Varhelo<br />
  26. 26. Strategic role<br />20<br />
  27. 27. Strategic role<br /><ul><li>Canbeused in varietyways
  28. 28. Contributes to superiorcustomervalue
  29. 29. Is difficult for compettitors to imitate</li></ul>21<br />Distinctive capabilities<br />
  30. 30. Main questions<br />Whatstrengths and weaknessesare in my responsibilityarea?<br />Whichstrengthsprovide my customerswithaddedvalue?<br />Which of the companystrengthswillboostourcompetitiveedge?<br />Howcan I strategiallymanagethesesareas to highlevels of performance?<br />22<br />
  31. 31. Main questions<br />Which things are done poorly, or not at all, in our organization?<br />Are we focusing on our core competences?<br />Are we doing too many things around the core things we should be doing?<br />23<br />
  32. 32. Value Chain Analysis<br />Markku Tomperi<br />Miika Kostamo<br />
  33. 33. Value Chain Analysis<br />Primary Activities<br />Margins<br />Support Activities<br />Micheal Porter 1985. Competitive Advantages.<br />25<br />
  34. 34. Value Analysis for an activity<br />No<br />Yes<br />No<br />No<br />Yes<br />Yes<br />ADDED VALUE = MARGIN<br />26<br />
  35. 35. http://garyhamel.com/<br />http://www.garyhamel.com/doc/hamel_cv.pdf<br />The Economist, http://www.economist.com/node/12311358<br />www.wikipedia.com<br />www.amazon.com<br />http://books.google.com/books?id=ifCmWeOgvQsC&pg<br />http://www.openlearningworld.com/books/Introduction%20to%20Strategic%20Management/Alternative%20Models%20of%20Developing%20Strategic%20Competitiveness/The%20Resource-Based%20Model.html<br />http://en.wikipedia.org/wiki/Robert_McQueen_Grant<br />Henry, Anthony: Understanding Strategic Management, Second Edition, Oxford 2011<br />Sources<br />27<br />

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