Internal Environment

Apuntes

Internal Environment Professor: Econ. Maria Cecilia Moreno Competitive Advantage • Firms achieve strategic competitiveness and earn above-average returns when their core competencies are effectively: • Acquired. • Bundled. • Leveraged. • Over time, the benefits of any value-creating strategy can be duplicated by competitors. Competitive Advantage • Sustainability of a competitive advantage is a function of: • The rate of core competence obsolescence due to environmental changes. • The availability of substitutes for the core competence. • The difficulty competitors have in duplicating or imitating the core competence. External Analyses’ Outcomes By studying the external environment, firms identify what they might choose to do. Opportunities and threats Internal Analyses’ Outcomes By studying the internal environment, firms identify what they can do Unique resources, capabilities, and competencies (required for sustainable competitive advantage) Creating Value • By exploiting their core competencies or competitive advantages, firms create value. • Value is measured by: • Product performance characteristics • Product attributes for which customers are willing to pay • Superior v...