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Syllabus C. Strategy C4. The Internal Resources, Capabilities & Competences Of An Organisation

C4a. Resources & Competencies

The internal resources, capabilities and competences of an organisation

Resources - machinery, money, manpower etc

SCA = Sustainable competitive advantage

STRATEGIC CAPABILITY

Using core competences to create a competitive advantage

Competitive advantage comes from the correct management of competences and resources

  • Resources

    1. Threshold Resources

      Without these, an entity can not survive in the market

    2. Unique Resources

      Competitors don’t have these and would find it difficult to acquire them. 

      Therefore they can form a competitive advantage

      However, be careful as these can disappear over time (eg Lose key employee, patent expires)

  • Competencies

    1. Threshold Competencies

      The ability to provide a threshold product. Same competencies as competitors (or very easy to imitate)

    2. Core Competencies

      Ability to meet CSFs and so give competitive advantage

    3. Sustainable Core Competencies

      Keeping the core competencies long enough to achieve strategic objectives. 

      So must be difficult to imitate

  • Organisations should expect real costs per unit to decline over time - thus they must attempt to continue to produce value for money

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