Chapter 4 - Evaluating a company’s resources, capabilities, and competitiveness. In this chapter, we will address the following questions: How well is the company’s present strategy working? What are the company’s resource strengths and weaknesses and its external opportunities and threats? Are the company’s prices and costs competitive? Is the company competitively stronger or weaker than key rivals? What strategic issues and problems merit front-burner managerial attention? | CHAPTER 4 EVALUATING A COMPANY’S RESOURCES, CAPABILITIES, AND COMPETITIVENESS Student Version McGraw-Hill/Irwin Copyright ®2012 The McGraw-Hill Companies, Inc. EVALUATING A FIRM’S INTERNAL SITUATION How well is the firm’s present strategy working? What are the firm’s competitively important resources and capabilities? Is the firm able to take advantage of market opportunities and overcome external threats to its external well-being? Are the firm’s prices and costs competitive with those of key rivals, and does it have an appealing customer value proposition? Is the firm competitively stronger or weaker than key rivals? What strategic issues and problems merit front-burner managerial attention? QUESTION 1: HOW WELL IS THE COMPANY’S PRESENT STRATEGY WORKING? Best indicators of a well-conceived, well-executed strategy: The company is achieving its stated financial and strategic objectives. The company is an above-average industry performer. QUESTION 2: WHAT ARE THE COMPANY’S COMPETITIVELY IMPORTANT RESOURCES AND CAPABILITIES? Competitive Assets Are the firm’s resources and capabilities. Are the determinants of its competitiveness and ability to succeed in the marketplace. Are what a firm’s strategy depends on to develop sustainable competitive advantage over its rivals. QUESTION 3: IS THE COMPANY ABLE TO SEIZE MARKET OPPORTUNITIES AND NULLIFY EXTERNAL THREATS? SWOT Analysis Is a powerful tool for sizing up a firm’s: Internal strengths (the basis for strategy) Internal weaknesses (deficient capabilities) Market opportunities (strategic objectives) External threats (strategic defenses) Identifying a Company’s Internal Strengths A Competence Is an activity that a firm has learned to perform with proficiency—a capability. A Core Competence Is a proficiently performed internal activity that is central to a firm’s strategy and competitiveness. A Distinctive Competence Is a competitively valuable activity that a firm performs better than its rivals. Identifying a Company’s . | CHAPTER 4 EVALUATING A COMPANY’S RESOURCES, CAPABILITIES, AND COMPETITIVENESS Student Version McGraw-Hill/Irwin Copyright ®2012 The McGraw-Hill Companies, Inc. EVALUATING A FIRM’S INTERNAL SITUATION How well is the firm’s present strategy working? What are the firm’s competitively important resources and capabilities? Is the firm able to take advantage of market opportunities and overcome external threats to its external well-being? Are the firm’s prices and costs competitive with those of key rivals, and does it have an appealing customer value proposition? Is the firm competitively stronger or weaker than key rivals? What strategic issues and problems merit front-burner managerial attention? QUESTION 1: HOW WELL IS THE COMPANY’S PRESENT STRATEGY WORKING? Best indicators of a well-conceived, well-executed strategy: The company is achieving its stated financial and strategic objectives. The company is an above-average industry performer. QUESTION 2: WHAT ARE THE COMPANY’S .
