This article had a lot of the same basic principles in it, but added the new twist of competition. It focused on how a company needs to always be watching out for their competition, which ties in well with the idea of strategic thinking as seeing, which was in the Strategy Safari book. The ideas presented in the article are a new approach to strategy, but one that should be mixed with the models presented in past articles. This article presents a new approach to strategy making that is based in economics and explains how a company’s resources drive its performance in a dynamic competitive environment
This article didn’t seem to be connected to another article, however it did connect with the Entrepreneurial School from Safari Strategy. It was connected to the diagram “Strategic thinking as seeing”. You need to be able to see the whole from from each person as they are looking at the past, future, above, below, and at the sides. This article showed different views of the resource-based view from internal and external.
Resources are very important to any company and finding them before your competitors is just as important. Valuable resources can be hidden within unused, tangible resources as well as intangible things like the talents of the employees. Any company that is not already well aware of their employee’s talents or other resources could implement these ideas quite well. Google would be a good example of a company that does not need to investigate their employees talent because it is already an extensive part of there hiring process.
Outline
1) Valuable resources: take on many different shapes
a. Physical- something tangible, for example, the wiring in your house
b. Intangible- something that can not be touched, such as knowledge.
c. Organizational Capability- how well a company does the job they set out to do.
d. Competitively Distinct- what sets a company a part.
2) External Market Tests:
a. The test of inimitability- is the resources hard to copy? Most important part of value creation because it limits competition.
i. Physical uniqueness – simply impossible to be copied
ii. Path dependency – not only unique, but also scarce
iii. Casual Ambiguity – when competitors have no idea how to even start re-creation of your product.
iv. Economic deterrence – when a company preempts a competitor by making a sizable investment in an asset
b. The test of durability – how quickly does this resource depreciate?
c. The test of appropriability- who captures the value that the resources creates?
d. The test of substitutability- can a unique resource be trumped by a different resource?
e. The test of competitive superiority- whose resource is really better?
i. Distinctive competence
ii. Consumer marketing skills
3) Strategic Implications
a. Investing in Resources
b. Upgrading Resources
c. Leveraging Resources