This document discusses strategic capabilities and how they contribute to an organization's long-term survival or competitive advantage. It defines strategic capabilities as the factors and assets an organization has that allow it to be profitable, grow its customer base, and cope with changes. These capabilities include resources, competencies, dynamic capabilities, threshold capabilities, and distinctive capabilities. The document also introduces the VRIO framework for assessing the basis of competitive advantage based on a capability's value, rarity, inimitability, and the organization's ability to support it.

1. Strategic Capabilities
Strategic Management
Course Title: Strategic Management Course No.: 501
Program: MBA 2.5 Evening Session: 2018-21
Teacher: Liaqat Javed Semester: III, Fall 2019

2. Exploring Strategic Model PCA
• The Strategic Position
• Strategic Choices
• Strategy in Action

3. Position
• Environment ✔
• Capability
• Purpose
• Culture

4. Strategic Capabilities
•that contribute to its long-term survival
or competitive advantage
•Factors
•Profitability
•Growth
•Customer base
•Coping with the Changes

5. Resources and Competence
• Resources
Assets that organizations have or can call
What we have
• Competence
The ways those assets are used or deployed effectively
What we do well
Intangible assets

6. Components of Strategic Capabilities

7. Dynamic Capabilities
• an organisation’s ability to renew and recreate its strategic
capabilities to meet the needs of changing environments
David Teece
• Sustain operational capabilities
• Ordinary Capabilities
• Sustainable Superior Performance
• Capabilities
• Can be imitated
• Common practice
• redundant
• Sensing
• Seizing
• Reconfiguring

8. Threshold and Distinctive Capabilities
Threshold Capabilities
• to meet the necessary requirements to compete and achieve parity
Distinctive Capabilities
• to achieve competitive advantage

9. VRIO  Basis of Competitive Advantage
•Value of Capability
•Rarity
•Inimitability
•Organizational Support

10. Value
Capability to create a product or a service that is of
value to customers and if, and only if, they generate
higher revenues or lower costs or both.
• Take advantage of opportunity and neutralize threats
• Cost conscious culture: Lean Production System
• Fashion Designer
• Value to Customer
• Cost

11. Rarity
• uniquely by one organization or by a few others
Inimitability
Difficult and costly to imitate or obtain or substitute
• Complexity
• Causal Ambiguity: Characteristics and Linkages
• Culture and History

12. Organizational Support
be suitably organised to support these capabilities
• Complementary Capability, Protect, sustain
The VIRO Framework

13. Organizational Knowledge
Organisation-specifc, collective intelligence, accumulated
through formal systems and people’s shared experience.
• Information System Support
• HR Capability
• Organization Culture
• Difficult to imitate
• Communities of Practice