Question

Keep in mind that each question has more than one part. Be sure to answer all parts of the quest.

Make certain that you cite sources appropriately. If you do indeed cite a source, explain it – explain why is helps answer the particular question.

1. Explain what resources, competencies, capabilities are, and how they can be used to create value (not the value chain) and competitive advantage. Be sure to consider capabilities and how do they affect resources and competencies.
2. Describe three barriers to entry within a specific service area and explain why you think these are the most important barriers.
3. Compare and contrast Strategic Planning, Strategic Thinking and how they impact and shape Strategy and Operational Effectiveness.
4. Define Mission, Vision and Values and explain how they are the foundation for strategy development and implementation.

Answer 1

(1).Resources - A Resource is a source or supply from which a benefit is produced and that has some utility and worth.

Competencies - Competence is the set of demonstrable characteristics and skills that enable, and improve the efficiency or performance of a job.

Capabilities - the power or ability to do something.

Considering a company as the vehicle for customer value creation we need to carefully analyze its strengths and weaknesses. This is what is normally referred to as the internal analysis. It concerns an appraisal of an organization’s resources and capabilities in the context of value creation opportunities and other external developments.

Competitive advantage is created by using resources and capabilities to achieve either a lower cost structure or a differentiated product. A firm positions itself in its industry through its choice of low cost or differentiation. This decision is a central component of the firm's competitive strategy.

(2). Barriers to entry are the obstacles or hindrances that make it difficult for new companies to enter a given market. These may include technology challenges, government regulations, patents, start-up costs, or education and licensing requirements.

Barriers to specific entry -

• Economies of scale: If a market has significant economies of scale that have already been exploited by the existing firms to a large extent, new entrants are deterred.
• Network effect: This refers to the effect that multiple users have on the value of a product or service to other users. If a strong network already exists, it might limit the chances of new entrants to gain a sufficient number of users.
• High research and development costs: When firms spend huge amounts on research and development, it is often a signal to the new entrants that they have large financial reserves. In order to compete, new entrants would also have to match or exceed this level of spending.

(3). Strategic thinking is the process of determining the direction you will take to achieve your vision.

Strategic planning is the process of developing a blueprint for the work you will do against that direction. Many people conflate these two concepts.

Through strategic planning and strategic thinking shape strategy and operational effectiveness. Both operational effectiveness and strategic positioning shape your company's performance but in different ways. Operational effectiveness is about internal competition and doing better today than you did yesterday. Strategic positioning is about external competition and standing out in your industry by doing things differently from your competitors.

(4). Mission - A mission statement is a short statement of why an organization exists, what its overall goal is, identifying the goal of its operations: what kind of product or service it provides, its primary customers or market, and its geographical region of operation.

Vision - something that you see or dream especially as part of a religious or supernatural experience.

Values - Values are basic and fundamental beliefs that guide or motivate attitudes or actions. They help us to determine what is important to us.

The importance of an organization to develop a vision, mission, and values is important for strategic direction. Without the individual foundations of strong values illustrated by a vision to be undertaken by a mission, an organization cannot become an overly successful organization. Without developing a mission, vision, and values to assist in developing a strategy, an organization cannot identify, distinguish or explain itself to its employees and customers alike. This paper will discuss the importance of developing a vision, mission, and values for the business of water turbine induction systems.

An organization such as an underwater turbine induction system company cannot develop a strategic plan without identifying vision, mission, and values. By formulating strong and ethical values that are the foundation and individual steps, a mission can be stated. A mission or the current state of affairs for an organization as it is currently helps employees and customers understand what the organization is all about. A mission assists the organization move toward its vision or ultimate goal or objective of what the ultimate end should look like when the organization achieves its mission. By identifying and understanding how values, mission, and vision interact with one another, and organization can plan a well designed and successful strategic plan leading to competitive advantage.