International Business Strategy

LON301BUS

Resources & Capabilities

Unit: 4 Knowledgecast: 1

• Demonstrate a sound appreciation of current strategic management concepts

• Assess current developments in the organisational environment and alternative responses related to strategy

Module Learning Outcomes

Strategic Capability

(Johnson & Scholes 2008:95)

“Strategic capability is the resources and competences of an organisation needed for it to survive and prosper.”

Strategic Capability

Four Typical Categories of Resources

• Physical

• Financial

• Human

• Intellectual

Foundations of Strategic CapabilityResources Competences

Threshold Capabilities

Threshold resources:TangibleIntangible

Threshold Competences

Capabilities for Competitive Advantage

Unique resources:Tangible Intangible

Core Competences

Cost Efficiency

EOS

Cost Efficiency

Experience

Design

Supply

Cost

Bases for Competitive Advantage

• Porter’s 3 Strategy Approach• Price-based Strategy• Differentiation Strategy• Hybrid Strategy• Focused differentiation Strategy• Failure Strategy

Capabilities for Sustainable Competitive Advantage

• Value• Rarity• Robustness• Non substitutability

• Demonstrate a sound appreciation of current strategic management concepts

Cost efficiency is potentially a source of strategic capability for both private, public and third sectors.

• Assess current developments in the organisational environment and alternative responses related to strategy

What role do the differing management functions play in sustaining competitive advantage?

Knowledgecast Summary

Journal Review: Kumar, N. (2006) “Strategies to Fight Low CostRivals”, British Journal of Marketing

In preparation for this seminar, please ensure you have read Kumar’s

article and prepared answers to the following questions for discussion

in the session.Q1. Identify the challenges existing businesses face from Low Cost Rivals (LCR)

Q2. How should existing businesses develop their strategy to respond to LCR?

Q3. Consider the formation of the strategy and identify the two options that Kumar recommends?

Q4. Can you suggest any alternative options?

Seminar

Assessment Preparation – Rehearsal

You will have an opportunity to use this time to rehearseyour presentation regarding the business environment ofyour case study organisation, which will be invaluable inpreparing you for the first assessment. Ensure eachmember of the group understands and accepts their roleand responsibilities.

Group Activity