Resources, Competitive Advantage and Internationalisation Strategies of Global Firms

Table of Contents
Introduction¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­1
Resources Audit of Volkswagen¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­.¡­¡­..¡­¡­..2
Strategy Analysis-Country Selection¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­.¡­¡­¡­¡­¡­.7
Conclusion¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­.¡­¡­¡­.¡­..10
References¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­¡­11

Introduction
The resource-based perspective regards the organisation as a heterogeneous bundle of resources and organisational capabilities that may enable the firms to deploy its resources more efficiently than rivals. In order to stand out in today¡¯s fiercely competitive and globalised market, firms must dynamically manage their unique resources and capabilities to achieve competitive advantage. Therefore, the performances and the decision-making processes of firms are primarily driven by their unique resources and capabilities. In the intensely competitive automobile industry, there must be resources and capabilities specific to Volkswagen that permit them to product at lower cost in relation to other business with inferior resources and capabilities in the same industry.

In this essay, I will first examine the various resources of Volkswagen, including both tangible and intangible resources, to identify the core competences of the company. Following, I will identify Volkswagen¡¯s capabilities, as a resource of competitive advantage, that differ from the others to make themselves consistently outperform the industry average, and how sustainable is their competitive position. In the second part of this essay, I will discuss how managers in Volkswagen making decisions of selecting China to expand with their distinctive resources and capabilities.

Resources Audit of Volkswagen
Barney (1991, p101) define resources of organisations ¡°include all assets, capabilities, organisational processes, firm attributes, information, knowledge, etc. controlled by a firm that

References: Barney, J.B. (1991), ¡°Firm Resources and Sustained Competitive Advantage¡±, Journal of Management, vol. 17, No.1, pp.99-120. Collis, D.J., (1991), ¡°A Resource-Based Analysis of Global Competition: The Case of the Bearings Industry¡±, Strategic Management Journal, vol.12, pp. 49-68. Grant, R., (1999), ¡°The Resource-Based Theory of Competitive Advantage: Implications for Strategy Formation¡±, in Segal-Horn, S. (1999), The Strategy Reader, Blackwell. Johnson, G., Schole, K. and Whittington, R. (2005), Exploring Corporate Strategy: Text and Cases, 7th edition, Pearson Education, London, pp. 115-233. Peteraf, M., (1993), ¡°The Cornerstones of Competitive Advantage: A Resource-Based View¡±, Strategic Management Journal, vol. 14, pp. 179-91. Porter, M.E., (1998), The Competitive Advantage of Nations. Tallman, S.B., (1991), ¡°Strategic Management Model and Resource-Based Strategies Among MNEs in a Host Market¡±, Strategic Management Journal, vol. 12, pp. 68-82. Volkswagen Group (2006), Annual Reports, downloaded from http://www.volkswagen-ir.de/Group_Structure.473.0.html as at 27th November, 2006.