2. Resource
A resource is an asset, competency, process,
skill, or knowledge controlled by an organization.
3. A resource is a strength
if It is superior ability to perform relative to their
competencies. A weakness if Perform poorly
4. VRIO Framework
Value – Does it provide competitive advantage
over competitors?
Rareness- Do other competitors possess it?
Imitability- Is it costly to imitate it ?
Organization- Is the firm organized to exploit the
resources
5. If the answer is yes about any resource
then it is of strategic importance
Value Does it provide competitive advantage Yes No
over competitors?
Rarenes Do other competitors possess it? Yes No
s
Imitability Is it costly to imitate it ? Yes No
Organiza Is the firm organized to exploit the Yes No
tion resources
6. stages in organizational appraisal
1. Identify and classify the firms resources in
terms of strenghts and weaknesses.
2. Combine the firms strengths into specific
capabilities. Corporate capabilities are the
things that an organization does exceedingly
well.
3. Appraise the profit potential of these resources
and capabilities in terms of their potential for
sustainable competitive advantage.
7. 4. Select the best strategy that best exploits the
firm’s resources and capabilities relative to
external opportunities.
5. Identify resource gaps and invest in upgrading
weaknesses.
