1. Internal Resources

2. The Value Chain Sequential process of value-creating activities
The amount that buyers are willing to pay for what a firm provides them
Value is measured by total revenue
Firm is profitable to the extent the value it receives exceeds the total costs involved in creating its product or service
The benefits of streamlining a business with value chain management include:
Lower infrastructure costs associated with collaboration.
Create commonality in parts and suppliers.
Control inventory by getting the supply chain talking to the demand chain.
Cut transaction costs by integrating with public and private exchanges.
Deliver products to market faster while minimizing risk and capital investment.
Adapted from Exhibit 3.1 The Value Chain: Primary and Support Activities
Source: Adapted with permission of The Free Press, a division of Simon & Schuster, Inc., from Competitive Advantage:
Creating and Sustaining Superior Performance by Michael E. Porter.

3. Resource-Based View of the Firm
Basic Assumption
Types of resources
Tangible resources
Intangible resources
Organizational capabilities
Organizational competencies
Dynamic Capabilities
Firms consist of a heterogeneous resource base

4. Innovation and creativity
Intangible Resources
Human
Innovation and creativity
Reputation
Intangible Resources are difficult for competitors (and the firm itself) to account for or imitate, typically embedded in unique routines and practices that have evolved over time
Human
Experience and capabilities of employees
Trust
Managerial skills
Firm-specific practices and procedures
Innovation and creativity
Technical and scientific skills
Innovation capacities
Reputation
Brand name
Reputation with customers
Reputation with suppliers

5. From Firm Resources to Sustainable Competitive Advantages
Is the resource or capability…
Valuable
Rare
Difficult to imitate
Difficult to substitute
Adapted from Exhibit 3.7 Four Criteria for Assessing Sustainability of Resources and Capabilities

6. Criteria for Sustainable Competitive Advantage and Strategic Implications
Exhibit 3.8 Criteria for Sustainable Competitive Advantage and Strategic Implications
Source; Adapted from J. Barney, “Firm Resources a Sustained Competitive Advantage, ‘ Journal of Management 17 (1991), pp

7. Management preferences
Diamond – E Model
Management preferences
Organization
Resources
Strategy
External Environment

8. Discussion?