You are on page 1of 20

Organizational Capability

Profile

ORGANIZATIONAL APPRAISAL
Internal Environment - strength & weakness in different
functional areas
Organization capability
- Capacity & ability to use distinctive
competencies to excel in a particular field
- Abilty to use its S & W to exploit O &
face
T in its external environment
Organization resources
- Physical & human
cost, availability - strength / weakness

ORGANIZATIONAL APPRAISAL

Organization behaviour
Identity & character of an organization
leadership, Mgt. Philosophy, values, culture, Qly of
work environment, Organization climate, organization
politics etc.
Resource
Behaviour
Distinctive competence - Any advantage a company has
over its competitor - it can do something which they
cannot or can do better - opportunity for an organization
to capitalize - low cost, Superior Quality, R&D skills
etc.

ORGANISATIONAL CAPABILITY
Organizational capability is the
inherent capacity or potential of an
organization to use its strengths
and overcome its weaknesses in
order to exploit opportunities and
face threats in its external
environment.
-It is also viewed as a skill for
coordinating resources and putting
them to productive use.

Measurable Attribute
-Subjective Attribute.
-it is Measurable and Comparable.
-sum total of resources and
behavior, strengths &
weaknesses, synergistic affects &
core competencies

Organizational Capability Factors


-Capabilities are developed in specific
areas.
-Marketing and Operations or in a part of
a functional areas, such as R&D &
Distribution.
-We have divided an Organization into six
largely accepted functional Areas.

Financial capability
Factors related to sources of funds:-capital structure,

procurement of capital,Controllership,working capital


availability, capital and credit availability.
Factors related to usage of funds:-capital investment,
fixed assets ,acquisition, current assets, loans and
advances, dividend distribution, relationship with
shareholders.
Factors related
to management of funds:-financial.
accounting and budgeting systems, management
control systems, cash ,inflation, return and risk
management, tax planning and advantages.

Marketing capability
Product related factors:-variety ,differentiation ,mix
quality, positioning, packaging
Price related factors:-pricing objectives, policies,
changes
Place related factors:-distribution ,transportation and
logistics,
marketing
channels,
marketing
intermediaries,.
Promotion related factors:-promotional tools, sales
promotion , advertising, public relations.

Operations capability
Factors related to production system
Factors related to the operations and
control systems
Factors related to R & D system

Personnel capability
Factors

related

to

the

personnel

system:-

manpowerplanning,selection,development,compensa
tion,communication and appraisal, position of the
personnel department within the organization,
Procedures and Standards.
Factors related to the organizational and employee characteristics:-

corporate image, quality of Managers, Staff and


workers Perception
Factors related to the Industrial relations:- Union Management
relationship, collective bargaining, safety and welfare
and security.

Information management capability


Factors related to the acquisition and retention of
information:-sources,quantity,quality,security
of

information.
Factors related to the processing and synthesis of
information:-Database
management,
computer

systems, software capability.


Factors related to the retrieval and usage of information:-

availability and appropriateness of information


formats and capacity
to assimilate and use
information

General Management
capability
Factors related to the general management capability: Factors related to the general managers:-orientation, risk
pronpensity,values,norms,personalgoals.compentence,capacity
for work, track record.
Factors related to the external relationships:-rapport with the
government, regulatory agencies and financial institutions,
public relations, social responsibility, public Image as
corporate citizen.
Factors related to the organizational climates:-organizational
culture, use of power, political Processes, nature of
organizational structure and controls ,etc.

ORGANIZATIONAL APPRAISAL
Organizational Capability Profile (OCP) - Weakness(-5),
Normal(0), Strength(5)
Financial Capability Profile

Weakness Normal Strength


(-5)
(0)
(5)

(a) Sources of funds


(b) Usage of funds
(c) Management of funds
Marketing Capability Profile
(a) Product related
(b) Price related
(c) Promotion related
(d) Integrative & Systematic

ORGANIZATIONAL APPRAISAL
Operations Capability Factor

Weakness Normal Strength


(-5)
(0)
(5)

(a) Production system


(b) Operation & Control system
(c) R&D system
Personnel Capability Factor
(a) Personnel system
(b) Organization & employee characteristics
(c) Industrial Relations
General Management Capability
(a) General Management Systems
(b) External Relations (c) Organization climate

EXAMPLES OF ORGANIZATIONAL
CAPABILITY PROFILE
Financial Capability
Bajaj - Cash Management
LIC - Centralized payment, decentralized collection
Reliance - high investor confidence
Escorts - Amicable relation with Fis
Marketing Capability
Hindustan Lever - Distribution Channel
IDBI/ICICI Bank - Wide variety of products
Tata - Company / Product Image

EXAMPLES OF ORGANIZATIONAL
CAPABILITY PROFILE
Operations Capability
Lakshmi machine works - absorb imported technology
Balmer & Lawrie - R&D - New specialty chemicals
Personnel Capability
Apollo tyres - Industrial relations problem

EXAMPLES OF ORGANIZATIONAL
CAPABILITY PROFILE
General management capability
Malayalam Manaroma - largest selling newspaper
Unchallenged leadership - Unified, stable
Best edited & most professionally produced

STRATEGIC ADVANTAGE PROFILE


(SAP)
Capability Factor
Personnel

General

Competitive strengths / Weakness

Quality of management & personnel


par with competition

High Quality experienced top


management - take proactive stance

strength

Neutra
l

Weaknes
s