WEEK 4 - Evaluating a company's resources, capabilities, and competitiveness.

Hi everybody! ^^ How are you today? Today, I would like share about what I’ve learned in chapter 4. Ok! Now, I want to ask you. What resources and capabilities are? Take 5-10 minutes to thinks and answer my question. So now, let’s compare your answer and my explanation about the two key words that I’ve mentioned earlier. 

Alright, now you know what my answer is. Then, compare with your answer. Is it same with me? Or your answer is more clearly and more suitable than me? Or your answers are differing from me? If I make a mistake, please let me know ok! Thank you. (^_^) Therefore, a firm’s resources and capabilities represent its competitive assets and are big determinants of its competitiveness and ability
to succeed in the marketplace. Resource and capability analysis is a powerful tool for sizing up a company’s competitive assets and determining if they can support a sustainable competitive advantage over market rivals.

Next, we move on VRIN test. What is VRIN? VRIN test is for sustainable competitive advantage which means sustain for a long-term. VRIN test ask if resources:

To identifying the firm’s resources and capabilities by VRIN testing, the firm should ask:

●     Is the resource (or capability) competitively Valuable?

●     Is the resource Rare—is it something rivals lack?

●     Is the resource hard to copy (Inimitable)?

●     Is the resource invulnerable to the threat of substitution from different types of resources and capabilities (Non-substitutable)?

Then, we move on SWOT analysis. Do you know what SWOT analysis is? I believe that many of us know what SWOT analysis is. While many can quickly understand what SWOT stands for? Basically, S represent as strength, W as weaknesses, O as opportunities, and T as threats. SWOT analysis is a powerful tool for sizing up a firm. Many too forget the need for matching external with internal factors to generate appropriate strategies.

Opportunities + Threats = External

Strengths + Weaknesses = Internal

                                               

I think I should not explain more about SWOT analysis because many of us can easily and quickly understand what SWOT analysis is. Hence, in business, internal and external should match together. By matching these two sets of factors, a rational strategic decision can be derived.

Lastly, I want to explain a little bit about the concept of a company value chain. A company’s value chain identifies the primary activities and related support activities that create customer value. The simple example of value chain process as following:

In short, value chain analysis facilitates a comparison, activity-by-activity; of how effectively and efficiently a firm delivers value to its customers, and relative to its competitors. Moreover, segregate the firm’s operations into different types of primary and secondary activities to identify the major components of its internal cost structure. So, I think that’s all for today. I’ve no idea to explain more because I’m not totally 100% understand about this concept. Sorry. (~_~) Please forgive me for the mistake that I’ve done and for the wrong information that I’ve shared with you. Thank you. See you later! ^^