WEEK 4 – INTERNAL ANALYSIS

BUSINESS PLAN AND MODELING

ESA UNGGUL

APRIL 2021
Dr. Edi Hamdi S.T., MSc
 Internal Audit Challenges:
• Related to the dynamics of resources, capability anc competencies
• Deals with uncertainty
• Deals with Complexity – Environment Perception
• Manages intra-organization conflicts Tangible resources include:
physical assets such as financial resources
and human resources including real estate,
raw materials machinery, plant, inventory,
brands, patents and trademarks and cash.
Intangible resources
Resources
may be embedded in organisational
"all assets, capabilities, organizational processes, firm
routines or practices such as an
attributes, information, knowledge, etc. controlled by a firm
organization's reputation, culture,
that enable the firm to conceive of and implement
knowledge or know-how, accumulated
strategies that improve its efficiency and effectiveness"
experience, relationships with customers,
suppliers or other key stakeholders.
Capabilities
Capabilities are "a special type of resource, specifically an
organizationally embedded non-transferable firm-specific
resource whose purpose is to improve the productivity of
the other resources possessed by the firm."
Competitive advantage

Barney defined it as "when [a firm] is able to implement a value

creating strategy not simultaneously being implemented by any
current or potential competitors”

Fulfill three criteria:

1.Provides potential access to a wide variety of markets.
2.Should make a significant contribution to the perceived
customer benefits of the end product.
3.Difficult to imitate by competitors.
Core Competence

Introduced by Prahalad and Hamelas "a harmonized combination

of multiple resources and skills that distinguish a firm in the
marketplace" and therefore are the foundation of companies'
competitiveness
Understood as well as "collective learning across the corporation"
RESOURCE BASED VIEW
The resource-based view (RBV) is a managerial framework used to determine the
strategic resources a firm can exploit to achieve sustainable competitive advantage.

Barney's 1991 article "Firm Resources and Sustained Competitive Advantage" is widely cited as a
pivotal work in the emergence of the resource-based view.

RBV focuses attention on an organisation's internal resources as a means of organising processes

and obtaining a competitive advantage.

For resources to hold potential as sources of sustainable competitive advantage, they should be
valuable, rare, imperfectly imitable and not substitutable (now generally known as VRIN criteria).

The resource-based view suggests that organisations must develop unique, firm-specific core
competencies that will allow them to outperform competitors by doing things differently
VRIN/O
•Valuable –
they enable a firm to implement strategies that improve its
efficiency and effectiveness.

•Rare –
not available to other competitors.

•Imperfectly imitable –
not easily implemented by others.

•Non-substitutable –
not able to be replaced by some other non-rare resource.

Or
Organization - respectively arrangement - Is the
resource supported by any existing arrangements
and can the organisation use it properly?
https://creately.com/diagram/example/jub0948z2/VRIO+analysis+of+Amazon+?utm_source=pinterest&utm_medium=social&utm_cam
paign=pinblock
 VALUE CHAIN
A value chain is a set of activities that an organization
carries out to create value for its customers.
Michel Porter proposed a general-purpose value chain
that companies can use to examine all of their
activities, and see how they're connected.

The way in which value chain activities are performed

determines costs and affects profits, so this tool can
help you understand the sources of value for your
organization

Value Chain focuses on systems, and how inputs are

changed into the outputs purchased by consumers. The
chain of activities common to all businesses, and
divided into primary and support activities https://www.business-to-you.com/value-chain/
https://www.slideshare.net/Mrirfan/the-porter-value-chain
GENERAL FRAMEWORK
STRATEGY DEVELOPMENT Assess STRENGTH and WEAKNESSES

POTENTIAL FOR SCA Appraise in terms of importances and strength

CAPABILITIES Exploring the linkage

RESOURCES Identification
DETAIL FRAMEWORK
ASSESSMENT SAMPLE
IFE SAMPLE