Strategic Capability
“An internal capacity for leveraging resources and competences is a prerequisite for creating competitive advantage. Discuss, with references to theory and real world organization of your choice”.
Strategic management is a multi faced and vast area of study with many theorists presenting differing views as to what is crucial to the successful formulation of strategy. This essay will present an explanation of the internal capacity of leveraging resources and competences and show how they are creating competitive advantage. This will be illustrated through the identification of the key drivers of competitive advantage. A strategic capability analysis of an organisation, namely Marks and Spencer. will be undertaken in order to identify which capabilities meet the criteria of value, rarity, robustness and non-substitutability. This study will be used to emphasise the impact of these key drivers which are likely to have an impact on the competitive advantage and on the organisation structure. This framework will be applied to the Marks&Spencers example. The way in which Marks&Spencers gain its competitive advantage will be identified by the key drivers of strategic capability and the impact they have on the industry will be than discussed further, highlighting the internal capacity for leveraging resources and competences. In conjunction with the capability analysis, SWOT analysis will help to identify the main strengths, weaknesses, opportunities and threats in example of M&S.
Before attempting to explain the internal capacity for leveraging resources and competences it is necessary to define the purpose of strategy in order to understand how strategic capability could contributes towards it. Johnson et al suggest that:
‘Strategic capability can be defined as the adequacy and suitability of the resources and competences of an organisation for it to survive and prosper.’
(Johnson et al, 2005:117)
Johnson et al considers that the strategic capability can be
Strategic management is a multi faced and vast area of study with many theorists presenting differing views as to what is crucial to the successful formulation of strategy. This essay will present an explanation of the internal capacity of leveraging resources and competences and show how they are creating competitive advantage. This will be illustrated through the identification of the key drivers of competitive advantage. A strategic capability analysis of an organisation, namely Marks and Spencer. will be undertaken in order to identify which capabilities meet the criteria of value, rarity, robustness and non-substitutability. This study will be used to emphasise the impact of these key drivers which are likely to have an impact on the competitive advantage and on the organisation structure. This framework will be applied to the Marks&Spencers example. The way in which Marks&Spencers gain its competitive advantage will be identified by the key drivers of strategic capability and the impact they have on the industry will be than discussed further, highlighting the internal capacity for leveraging resources and competences. In conjunction with the capability analysis, SWOT analysis will help to identify the main strengths, weaknesses, opportunities and threats in example of M&S.
Before attempting to explain the internal capacity for leveraging resources and competences it is necessary to define the purpose of strategy in order to understand how strategic capability could contributes towards it. Johnson et al suggest that:
‘Strategic capability can be defined as the adequacy and suitability of the resources and competences of an organisation for it to survive and prosper.’
(Johnson et al, 2005:117)
Johnson et al considers that the strategic capability can be
Bibliography: Collis, D. J., Montgomery, A. C., (1997), Corporate Strategy, Resources and the Scope of the Firm, 1st edition, McGraw-Hill, USA Collis, D. J., Montgomery, A. C., (1995), Harvard Review, Competing on Resources: Strategy in the 1990s, USA Growth inside (2005), Growth inside [Online] Avalaible at: http://www.growth-insights.com/articles/GES_CoreCompetencies.pdf (Accessed 15th November 2007) Guardian Unlimited, Wearden, G (accessed 28th November 2007) Guardian Unlimited, (2004), ’M&S takes top gong at 'branding Oscars ' (accessed 1st December 2007) Johnson, G., Scholes, K and Cases. 7th edition, Harlow. FT Prentice Hall Marks and Spencer’s (2007), How do we do business – Report [Online], Avalaible at: https://images-na.ssl-images-amazon.com/images/G/02/00/00/00/32/17/82/32178202.pdf?mnSBrand=core (Accessed 16th November 2007) (Accessed 27th November 2007) Porter, M Thomson, Jr., A. A and Strickland, III, A. J. (1999), Strategic Management Concepts and Cases Thomson, Jr, A. A., Gamble J. E., Strickland A. J. III, (2004), Strategy, Winning in the Market Place, 1st edition, Irwin/McGraw-Hill