Internal scanning: Organizational...

Internal scanning: Organizational

Analysis

Dr. M. Zia-ur-Rehman

E-mail: drziaemail@gmail.com Website: www.academyofresearch.co.uk

Academician, Trainer and Consultant HEC Approved Ph.D. Supervisor Ph.D., MA Eng., MPM, MBA, M.Ed., LLB

By: Prof. Dr. M. Zia-ur-Rehman, scholarknowledge@gmail.com

By: Prof. Dr. M. Zia-ur-Rehman, scholarknowledge@gmail.com By: Prof. Dr. M. Zia-ur-Rehman, scholarknowledge@gmail.com

By: Prof. Dr. M. Zia-ur-Rehman, scholarknowledge@gmail.com

Copyright ® Prof. Dr. M. Zia-ur-Rehman

Organizational analysis- concerned with identifying

and developing an organization’s resources and competencies

by Dr. Zia

Core and Distinctive Competencies

Resources- an organization’s assets *  Tangible *  Intangible Capabilities- a corporation’s ability to exploit its

resources

by Dr. Zia

Competency- a cross-functional integration and coordination of capabilities

Core competency- a collection of competencies that cross divisional boundaries, is wide-spread throughout the corporation and is something the corporation does exceedingly well

Distinctive competency- core competencies that are superior to those of the competition

by Dr. Zia

1.  Organizational Analysis 2.  Resources 3.  Capabilities 4.  Competencies 5.  Core competencies 6.  Distinctive competencies

by Dr. Zia

A strategic challenge is a fundamental challenge affecting an organization’s/country’s mandates, mission, projects,

products, service, clients, costs, resources, organization or management.

by Dr. Zia 5-6

Strategic challenge

By: Prof. Dr. M. Zia-ur-Rehman, drziaemail@gmail.com By: Prof. Dr. M. Zia-ur-Rehman, drziaemail@gmail.com

by Dr. Zia 5-7

What does this look like in the real world?

Strategic challenges

•  Terrorism (state or in any sense)•  Global warming•  Climate change•  Education•  Peace •  Health•  Security

by Dr. Zia 5-8

•  Poverty •  Gender equality •  Poverty •  Governance •  Security issues •  Population •  Food and health

Direct

Indirect Goals

Vision of

Success Oval

Mapping Issue Tensions

Systems Analysis

Strategic Challenges/Issues

by Dr. Zia 5-9

*  When will this issue affect your organization/country? ��

*  What kind of an impact will it have on your organization/country?

*  Will addressing this issue require a new service, resources, product, project or staff ?

by Dr. Zia 5-10

How Do You Know When it is becoming Strategic?

VRIO framework (Barney) *  Value *  Rare *  Imitability *  Organization

by Dr. Zia

How to gain competitive advantage ?

Using Resources to Gain Competitive Advantage

1.  Identify and classify resources 2.  Combine the firm’s strengths 3.  Appraise profit potential 4.  Select the strategy 5.  Identify resource gaps

by Dr. Zia

Access to a Distinctive Competency

1.  Asset endowment 2.  Acquired from someone else 3.  Shared with another business 4.  Built and accumulated within the company

by Dr. Zia

Access to a Distinctive Competency

Clusters- geographic concentrations of interconnected companies and industries

Access to: •  Employees •  Suppliers •  Information •  Complementary products

by Dr. Zia

Imitability an Advantage

* Durability

*  Imitability

by Dr. Zia

Determining the Sustainability of an Advantage * Transparency * Transferability * Replicability

by Dr. Zia

Determining the Sustainability of an Advantage * Explicit knowledge- * Tacit knowledge-

by Dr. Zia

Business Model

by Dr. Zia

Business models- a company’s method for making money in the current

business environment

Includes *  Who the company serves *  What the company provides *  How the company makes money *  How the company differentiates and sustains

competitive advantage *  How the company provides its product/service

by Dr. Zia

Activity : *  Sharing of any business model by students (discussion oriented)

by Dr. Zia

Business model

Business models *  Customer solutions model *  Profit pyramid model *  Multi-component system/installed model *  Advertising model *  Switchboard model *  Efficiency model *  Blockbuster (HIT)model *  Profit multiplier model *  Entrepreneurial model *  De Facto (in reality) industry standard model

by Dr. Zia

Value Chain Analysis

by Dr. Zia

Value chain- a linked set of value creating activities that begin with basic raw materials coming from suppliers, moving on to a series of value-added activities involved in producing and marking a product or service, and ending with distributors getting the final goods into the hands of the ultimate consumer

by Dr. Zia

Industry Value Chain Analysis

Value chain segments include: *  Upstream *  Downstream

Center of gravity

by Dr. Zia

Corporate Value Chain Analysis

by Dr. Zia 5-26

Primary activities

Support activities

by Dr. Zia

Corporate Value Chain Analysis

Remember three examining points:

1.  Examine # 1 2.  Examine # 2 3.  Examine # 3

by Dr. Zia

Scanning Functioning Resources & Capability

by Dr. Zia

Basic Organizational Structures

*  Simple *  Functional *  Divisional *  Strategic Business Units *  Conglomerate (multinational)

by Dr. Zia

Corporate Culture: The Company Way

Corporate culture- the collection of beliefs, expectations and values learned and shared by a corporation’s members and transmitted from one generation of employees to another.

by Dr. Zia

Functions of Corporate Culture

•  Conveys a sense of identity for employees •  Generates employee commitment •  Adds to the stability of the organization as a social

system •  Serves as a frame of reference for employees to

understand organizational activities and as a guide for behavior

by Dr. Zia

Corporate Culture: The Company Way

Cultural intensity Shows the depth of the culture

Cultural integration Shows the breadth of the culture

by Dr. Zia

Strategic Marketing Issues

Market position- Who are our customers?

Marketing Mix- the particular combination of key variables under a corporation’s control that can be used to affect demand and to gain competitive advantage

by Dr. Zia

Product life cycle- product monetary sales over time from introduction through growth and maturity to decline

by Dr. Zia

Brand- a name given to a company’s product which identifies that item in the mind of the consumer

Corporate brand- a type of brand in which the company’s name serves as the brand

by Dr. Zia

Corporate reputation- a widely held perception of a

company by the general public *  Stakeholders’ perceptions of quality *  Corporation’s prominence in the minds of stakeholders

by Dr. Zia

Strategic Financial Issues

Financial leverage- ratio of total debt to total assets *  Used to describe how debt is used to increase earnings

available to common shareholders

Capital budgeting- the analyzing and ranking of possible investments in fixed assets in terms of additional outlays and receipts that will result from each investment

*  Hurdle point

by Dr. Zia

Strategic Research and Development Issues

R & D intensity- pending no R & D as a percentage of sales revenue

Technology competence- the development and use of innovative technology

Technology transfer- the process of taking new technology from the laboratory to the marketplace

by Dr. Zia 5-41

R & D Mix- the mix of: Basic R & D- focuses on theoretical problems Product R & D- concentrates on marketing and is

concerned with product or product packaging improvements

Engineering R & D is concerned with engineering, concentrating on quality control, and the development of design specifications and improved production equipment

by Dr. Zia 5-42

Technology discontinuity- when a new technology cannot be used to enhance current technology, but substitutes for the technology to yield better performance

by Dr. Zia 5-43

by Dr. Zia 5-44

Strategic Operations Issues

Intermittent Systems- item is normally processed sequentially, but the work and sequence of the process vary

Continuous systems- work is laid out in lines on which

products can be continuously assembled or processed Operating leverage- impact of a specific change in sales

volume on net operation income

by Dr. Zia 5-45

Experience curve- unit production costs decline by some fixed percentage each time the total accumulated volume of production units doubles

by Dr. Zia 5-46

Flexible Manufacturing for Mass Customization *  Computer Assisted Design *  Computer Assisted Manufacturing *  Economies of Scale

by Dr. Zia 5-47

Strategic Human Resource Issues

Teams Autonomous (self-managed)- a group of people

working together without a supervisor to plan, coordinate and evaluate their work

Cross-functional work teams- various disciplines are involved in a project from the beginning

Concurrent engineering- specialists work side-by-side and compare notes constantly to design cost-effective products with features customers want

by Dr. Zia 5-48

Strategic Human Resource Issues Virtual Teams- groups of geographically or

organizationally dispersed coworkers that are assembled using a combination of telecommunications and information technologies to accomplish organizational tasks- driven by 5 trends

by Dr. Zia 5-49

Strategic Human Resource Issues *  Flatter organizational structures *  Turbulent environments *  Increased employee autonomy *  Higher knowledge requirements *  Increased globalization *  Increased employee decision making

by Dr. Zia 5-50

Strategic Human Resource Issues Quality of work life- includes improvements in:

*  Introducing participative problem solving *  Restructuring work *  Introducing innovative reward systems *  Improving the work environment

by Dr. Zia 5-51

Strategic Human Resource Issues Human diversity- the mix in the workplace of people

from different races, cultures and backgrounds

*  Provides a sustainable competitive advantage

by Dr. Zia 5-52

Strategic Information Systems/Technology Issues

Information systems/technology contributions to performance:

*  Automation of back office processes *  Automation of individual tasks *  Enhancement of key business functions *  Development of a competitive advantage

by Dr. Zia 5-53

Current trends in Information systems/technology Internet include:

*  Intranet *  Extranet *  Web 2.0

by Dr. Zia 5-54

Supply chain management- networks for sourcing raw materials, manufacturing products or creating services, storing, and distributing goods, and delivering them to customers and consumers

by Dr. Zia 5-55

by Dr. Zia 5-56

1. What is the relevance of the resource-based view of the firm to strategic management in a global environment?

2. How can value chain analysis help indentify a company’s strengths and weaknesses?

3.  In what ways can a corporation’s structure and culture be internal strengths and weaknesses?

4. What are the pros and cons of management using the experience curve to determine strategy?

5. How might a firm’s management decide whether it should continue to invest in current known technology or in new, but untested technology? What factors might encourage or discourage such a shift?

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