Analysing resources and assessing competitive advantage

STRATEGIC MANAGEMENT (U2 6151)

SESSION TH RE E
This lecture is about...

What are resources What are key success

and capabilities? factors?

How to diagnose
competitive advantage
What are resources and capabilities?

Tangible

Competences
Resources or capabilities
are what the are what the
Intangible
organization organization
has does with its
resources
Human
Diagnosing Strategic Capability:
How value is created or lost
Market price Meeting
KEY
SUCCESS
Keep costs FACTORS
down, but do means a
not reduce happy
customer
perceived
customer The activities
value of the firm
Add value but
not to the
point where
there is no
perceived Profit Margin
benefit
Key Success Factors
Online retailing

Luxury cars

What are the Key

Success Factors in Self assembly furniture
these industries?
Budget hotels
But key success factors change
https://www.theguardian.com/business/2018/oct/11/mini-ikea-planning-studio-spin-off-store-
opens-central-london?CMP=share_btn_link

Because the environment changes;

Fewer people own large cars
It is getting harder to get planning permission for large stores
Customers don’t have time to go to out of town stores
Online purchase of furniture is growing
The furniture industry in UK has reached shake-out stage therefore no need for
further large stores
Diagnosing competitive advantage
The value chain (Porter, 1985)

Firm infrastructure
Human resource management Profit Margin
Support
Technology development
activities
Procurement

Inbound Outbound Service

logistics Operation logistics Marketing
and sales

Primary activities