CHAPTER 5

Internal Scanning: Organizational

Analysis

5-1
 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

5-2
 Resource-Based Approach to Organizational Analysis

•Resources

•Capabilities

•Competency

•Core competency

•Distinctive competency

5-3
 Core and Distinctive Competencies

VRIO Framework --

–Value

–Rareness

–Imitability

–Organization

5-4
 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

5-5
Continuum of Sustainability

5-6
 Sustainability of Advantage

Durability --

– Rate at which a firm’s underlying resources

and capabilities depreciate or become
obsolete

Imitability --

– Rate at which a firm’s underlying resources

and capabilities can be duplicated by others

5-7
 Sustainability of Advantage

Core Competency can be imitated --

–Transparency

–Transferability

–Replicability

5-8
 Business Models

Company’s method for making money in

the current business environment.

5-9
 Business Models

Types of Models --

–Customer Solutions Model

–Profit Pyramid Model
–Multi-Component System/Installed Base Model
–Advertising Model
–Switchboard Model

5-10
 Business Models

Types of Models --

–Time Model
–Efficiency Model
–Blockbuster Model
–Profit Multiplier Model
–Entrepreneurial Model
–De Facto Standard Model

5-11
 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

5-12
 Value-Chain Analysis

Typical Value Chain for

a Manufactured Product

5-13
 Corporate Value-Chain Analysis

•Primary activities

•Support activities

5-14
Corporation’s Value Chain

5-15
 Scanning Functional Resources & Capabilities

Basic Organizational Structures --

–Simple structure

–Functional structure

–Divisional structure

–Strategic business units (SBU’s)

–Conglomerate structure

5-16
Basic Organizational Structures

5-17
 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

5-18
 Strategic Marketing Issues

–Market Position & Segmentation

–Marketing Mix

–Product Life Cycle

–Brand & Corporate Reputation

5-19
 Strategic Financial Issues

–Financial leverage

–Capital budgeting

5-20
 Strategic Research & Development Issues

–R&D Intensity

–Technological Competence

–Technology Transfer

5-21
Technological Discontinuity

5-22
 Strategic Human Resource Management Issues

HRM –

–Increasing use of teams

–Union relations

–Temporary workers

–Quality of work life

–Human diversity
5-23
Internal Factor Analysis Summary Table

5-24