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BUS 499, Week 3: The Internal Organization: Resources, Capabilities, Core Competencies, and Competitive Advantages Slide # Topic Narration 1 Introduction Welcome to the Business Administration Capstone. In this lesson we will discuss The Internal Organization: Resources, Capabilities, Core Competencies, and Competitive Advantages Next slide. 2 Objectives Upon completion of this lesson, you will be able to: Analyze the internal environment of a company for strengths and weaknesses that impact the firm’s competitiveness. Next slide. 3 Topics In order to achieve this objective, the following supporting topics will be covered: Analyzing the internal organization; Resources, capabilities, and core competencies; Building core competencies; Outsourcing; and Competencies, strengths, weaknesses, and strategic decisions. Next slide. 4 Internal Analysis In the global economy, traditional factors such as labor costs, access to financial resources and raw materials, and protected or regulated markets remain sources of competitive advantage, but to a lesser degree. One important reason is that competitors can apply their resources to successfully use an international strategy as a means of overcoming the advantages created by these more traditional sources. Increasingly, those who analyze their firm’s internal organization should use a global mind-set to do so. A global mind-set is the ability to study an internal organization in ways that are not dependent on the assumptions of a single country, culture, or context. Because they are able to span artificial boundaries, those with a global mind-set recognize that their firms must possess resources and capabilities that allow understanding of and appropriate response to competitive situations that are influenced by country-specific factors and unique societal cultures. Finally, analysis of the firm’s internal organization requires that evaluators examine the firm’s portfolio of resources and the bundles of heterogeneous resources and capabilities managers have created. This perspective suggests that individual firms possess at least some resources and capabilities that other companies do not. Next slide. 5 Creating Value By exploiting their core competencies or competitive advantages to at least meet if not exceed the demanding standards of global competition, firms create value for customers. Value is measured by a product’s performance characteristics and by its attributes for which customers are willing to pay. Firms with a competitive advantage offer value to customers that are superior to the value competitors provide. Firms create value by innovatively bundling and leveraging their resources and capabilities. Firms unable to creatively bundle and leverage their resources and capabilities in ways that create value for customers suffer performance declines. Sometimes, it seems that these declines may happen because firms fail to understand what customers value. Ultimately, creating value for ...

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