Internal Analysis
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Transcript of Internal Analysis
Internal AnalysisStrategic Management Chapter 4Section 092; Team 5Matthew Tawfiq, Jacqueline Henderson, Paul Briseno, Richard Alven1Internal Analysis DefinedProcess of evaluating organizations resources and capabilities
Why?In order to formulate appropriate and effective strategies you have to know what an organization can and cannot do well, and what assets it has or does not haveResources to Organizational CapabilitiesResources are useless on their own
Organizational Capabilities various routines and process that transforms resources into outputs
Organizational Routines and Processes Regular, predictable, and sequential work activities done by organizational membersCreate a Competitive AdvantageCapabilities involve interactions between people, people, and resources.
Must get right combination and routines down
Cant just gather resources! Have to use them properly!
Dynamic Capabilities
An organizations ability to build, integrate and reconfigure capabilities to address rapidly changing environments
Southwest vs. DeltaCore CompetenciesAny major value-creating capabilities organizations have that are essential to their business are as core competencies
Enhance organizations capabilities
Distinctive CapabilitiesSpecial and unique capabilities that distinguish an organization from its competitors
Disney Distinct CapabilitiesTheme parks that offer rides, entertainment, food, onsite lodging and packages.These are things traditional theme parks do not offer.Distinct CapabilitiesContributes to superior customer service
Can be used in a variety of ways
Is difficult for competitors to imitateCompetitive AdvantageCompetitive advantage sets organization apart from others
Affects performance results positively
Internal AnalysisStrengths: Resources and capabilities developed into sustainable competitive advantage
Weaknesses: Resources and capabilities that are lacking or deficient and prevent the organization from developing sustainable competitionTypes of Internal AnalysisValue Chain
Internal Audit
Capabilities Profile
Value ChainSystematic way of examining all the organizations functional activities and how well they create customer value
Internal AuditA thorough assessment of an organizations internal areasAssess resources and capabilities from all perspectivesDetermine what company is capable of and what it is not capable of.Internal AuditOrganizational FunctionsProduction-OperationsMarketingFinancial-AssetsManagementInfo SystemsOrganizational ElementsStrategic ManagementOrganizational StructureOrganizational CultureCapabilities Assessment ProfileDetermining Strategical WeaknessesInternal Analysis reflects strengths and weaknessesHow are your competitors doing?Compare capabilities to see how you stack up.Public informationForbes, FortuneMarketing reportsGrey ZoneBorderline CriminalTrash, spying
Why is an Internal Analysis Important Only way to identify strengths and weaknesses
Needed for making good strategic decisions