Strategic Management Ch. 4

  1. Unique, deeply embedded, firm-specific strengths that allow companies to differentiate their products and services and thus create more value for customers than their rivals, or offer products and services of acceptable value at lower cost
    Core competencies
  2. Assets that a company can draw on when crafting and executing strategy
  3. The organizational and managerial skills necessary to orchestrate a diverse set of resources to deploy them strategically
  4. Distinct and fine-grained business processes that enable firms to add incremental value by transforming input into goods and services
  5. Resources that have physical attributes and are visible
    Tangible resources
  6. Resources that have no physical attributes and are invisible
    Intangible resources
  7. Competitive advantage ismore likely to be based on
    intangible resources
  8. The assumption behind resource-based view that assumes hundles of resources, capabilities and competencies idffere across firms. Resource bundles of firms competing in the same industry are unique to some extent and thus differ from one another
    Resources heterogenity
  9. The assumption behind resource-based view that assumes that resources tend to be "sticky" and don't move easily from firm to firm. Resource differences that exist between firms are difficult to replicate and, therefore, can last for a long time
    Resource immobility
  10. What are VRIO attribues
    • For a firm's resources to be the basis of a competitive advante it must be
    • Valuable
    • Rare
    • Costly to imitate
    • Organized in a way to capture the value of the resource
  11. A resource is valueable if...
    it allows the firms to take advantage of an external opportunity and/or neutralize an external threat
  12. A resources is rare if
    The number of firms that possess it is less than the number of firms it would require to reach a state of perfection
  13. A resource is costly to imimate if
    Firms that do not possess the resources are unable to develop or buy the resource at a comparable cost
  14. The firm is organized to capture the value of the resource if
    It has an effective organizational strucutre, prossess, and systems in place to fully exploit the compettive potential
  15. What are the barriers to immitation
    • Better expectations of future resource value (or simply luck)
    • Path Dependence
    • Casual ambiguity
    • Social Complexity
  16. These allow a firm to create, deploy, modify, reconfigure, or upgrade its resource base to gain and sustain competitive advantage in a constaly changing environment
    Dynamic capabilities
  17. To sustain a competitive advantage, any fit between a firm's internal strength and the external environment must be
  18. Describes the internal acitivities a firm engages in when transforming inputs into outputs
    Value chain
  19. Each activity the firm performs along the horizontal chain adds
    Incremental value and incremental costs
  20. When a firm's set of distinct activities is able to generate value greater than the costs to create it, the firm obtains a
    Profit margin
  21. A situation in which the cause and effect of a phenomenon are not readily apparent
    Casual ambiguity
  22. Barriers to imitation that prevent rivals from competing away the advantage a firm may enjoy
    Isolating mechanisms
  23. A situation in which the options one faces in the current situation are limited by decisions made in the past
    Path dependence
  24. Firm activiites that add value directly by transforming in puts into outputs as the firm moves a product or service horizontally along the internal value chain
    Primary activities
  25. A situation in which different social and business systems interact with one another
    Social complexity
  26. Research & Developmentinformation systemsHuman Resources Account & FinanceFirm Infrastrucutre, incl. processess, policies & procedures
    Support activities
  27. Supply Chain Management
    Marketing & Sales
    After-sales service
    Primary activities
Card Set
Strategic Management Ch. 4