Chapter 3 :

Internal Analysis

Business Strategy
Types of Company Resources
Tangible Resources
Physical resources
Financial resources
Technological assets
Organizational resources
Intangible Resources
Human assets and intellectual capital
Brands
External relationships
Company culture and incentive system
 VRIN Framework

* Value: Resources that can bring value can be a source of

competitive advantage. Keep in mind that not all resources are
equally easy to obtain.
* Rareness: Resources that are available to all competitors
rarely provide any significant competitive advantage.
* Imitability: An ideal resource cannot be obtained by competing
businesses.
* Non-substitutable: An ideal resource cannot be substituted by
any other resource.
 Value Chain Analysis

The value chain model of corporate activities developed by

Michael Porter (1996).
A value chain is a chain of activities for a firm operating in a
specific industry. The business unit is the appropriate level
for construction of a value chain, not the divisional level or
corporate level. Products pass through all activities of the
chain in order, and at each activity the product gains some
value. The chain of activities gives the products more added
value than the sum of added values of all activities.
Value Chain Analysis
Value Chain Analysis
 7

Value Chain Analysis

• Primary activities are directly • Support activities provide

related to production, sales,
marketing, delivery and
services
• Inbound logistics
• Operations
• Outbound logistics
• Marketing and sales
• After sales service
purchased inputs, human
resources, technology and
infrastructural functions to
support the primary activities
• Procurement
• Technology development
• Human resource
management
• Management Planning
 Steps Of Value Chain Analysis

Break down a market/organization into its key activities

under each of the major headings in the model;

Assess the potential for adding value via cost advantage or

differentiation, or identify current activities where a business
appears to be at a competitive disadvantage;

Determine strategies built around focusing on activities

where competitive advantage can be sustained

file://localhost/Volumes/DATA/1DATA LATEST/IBD /BS/Clip & Reading/Chapter 3 -

Coke value chain.MP4

http://www.youtube.com/watch?v=gN8bhTfwpdQ
Clip/value chain analysis.mp4
Examples for value chain analysis in the p.81 (Read & Analysis)
7S Framework