Reflections on Unit 3 - Competing with Capabilities

Today I have been...

Looking over Unit 3 - "Competing with Capabilities"


Why?

Learning!

So What?

Unit 2 was about the Analysis stage of the J&S strategy cycle, in particular environmental threats and how to identify them - focus was the industry. Unit 3 stays at the analysis stage but is more about the organisation, and looking at organisational strengths and weaknesses with a Resource Based View (RBV).

RBV - a theoretical approach which assumes that organisations differ in respect of the resources they posess and the capabilities they have developed, and these differences account for the variation in performance between organisations.


So, the learning outcomes.

• Have a theoretical understanding of RBV (which can be considered complementary to an industry structure/market positioning approach)
• be able to apply the RBV through organisational analysis
• be able to show the basics of how RBV relates to knowledge and learning
• understand the notion of sustainability of competitive advantage
• appreciate the need to consider resourced and capabilities within a dynamic framework (strategic value of capabilities can change over time)

p7 s2 What is a RBV to strategy?

Popularised by Prahalad and Hamel (1990) - immediate competitiveness depends on price/performance of current products but long-term competitiveness depends on ability to develop a core competence around a key skill or skills. These skills, resources and capabilities are complementary.

RBV - critical difference between organisations irrelevant to industry is their assets (resources) and how they use them. Managers determine how well or not they are used. Applicable to commercial and NFP.

Assumption is that orgs are heterogeneous rather than homogeneous. Assets include tangible and intangible assets as well as skills and know-how. Ability to co-ordinate and use these assets is the org's capabilities.

Grant's diagram - Grant 2005 p139/ u3s2p8.