Internal Environment: Resources, Capabilities, CSFs

Enterprise Strategy/AW/02b

Arj Wignaraja

The Johnson and Scholes Model of Strategic Management

StrategicImplementation

StrategicChoice

StrategicAnalysis

Critical Success Factors DefinedCIMA Official Terminology: CRITICAL SUCCESS

FACTORAn element of organisational activity which is central to its future success. Critical success factors may change over time, and may include items such as product quality, employee attitudes, manufacturing flexibility and brand awareness.

“ the limited number of areas in which results, if they are satisfactory, will enable successful competitive performance.” — Rockart & Hoffman, 1992

According to its originators, critical success factors (CSFs) are:

Critical Success Factors and Key Performance Indicators

CSF’s & KPI’s for Select Industries

Restaurant

Auto

Hospital

The Resources of the Firm – What Makes them Strategic?

Physical

Financial

Reputational

Capabilities/Competencies

Intellectual

Human Resources

LimitedHigh tacit knowledge

Time & place dependent

Significant sunk costs

Basic Unique

Threshold Core

Core Competencies form the Basis of Competitive Advantage

Resources

Competencies

Same as competitor & easy to copy

Different to competitor & difficult to copy

Analyzing Strategic Capability

Resources Audit Competencies Core Competencies

Assessing BalanceIdentify Key IssuesUnderstanding Strategic

Capability

Comparison: Historical, industry norms, Benchmark

Rigidity: Preventing change

Resource Audit – The M’s Model