Strategic Management task 2
Resource Weakness
Thompson, Peteraf, Gamble, and Strickland (2012) say that a weakness, or competitive disadvantage, is something that a company lacks or does poorly, or a condition that puts it at a competitive disadvantage in the market place. There are three resource weaknesses that can exist. The three weaknesses are inferior or unproven skills, expertise, or intellectual capital in competitively important areas of business, deficiencies in competitively important physical, organizational, or intangible assets, or missing or competitively inferior capabilities in key areas. H Company experienced resource weaknesses during the first four years of operations. The largest resource weakness found in the first four years of H Company’s operations are weaknesses of inferior skills, expertise, or intellectual capital. H Company put much resource into the private label brand, which did not sell due to low demand. In addition to low demand, the resource allocation for the brand was too high. The blame for allocating too much resources stems from inexperienced management. Looking through the simulation results, it is apparent that after year one, the private label brand should have been discontinued. However, due to lack of experience, H Company continued to pump more money and resources attempting to create market share and sales for the private label brand. H Company was not successful in strengthening, or compensating for, the weakness of inexperienced decision making in the first four years. You will see that H Company was not successful in correcting the weakness, or making up for the weakness in another area, by looking at the first four years Net Revenue, Return on Equity, and Stock Price, which all steadily declined in the first four years, below investor expectations.
Resource Strength
Thompson, Peteraf, Gamble, and Strickland (2012) define a resource strength as something a company is good at doing or an attribute that enhances it’s
Thompson, Peteraf, Gamble, and Strickland (2012) say that a weakness, or competitive disadvantage, is something that a company lacks or does poorly, or a condition that puts it at a competitive disadvantage in the market place. There are three resource weaknesses that can exist. The three weaknesses are inferior or unproven skills, expertise, or intellectual capital in competitively important areas of business, deficiencies in competitively important physical, organizational, or intangible assets, or missing or competitively inferior capabilities in key areas. H Company experienced resource weaknesses during the first four years of operations. The largest resource weakness found in the first four years of H Company’s operations are weaknesses of inferior skills, expertise, or intellectual capital. H Company put much resource into the private label brand, which did not sell due to low demand. In addition to low demand, the resource allocation for the brand was too high. The blame for allocating too much resources stems from inexperienced management. Looking through the simulation results, it is apparent that after year one, the private label brand should have been discontinued. However, due to lack of experience, H Company continued to pump more money and resources attempting to create market share and sales for the private label brand. H Company was not successful in strengthening, or compensating for, the weakness of inexperienced decision making in the first four years. You will see that H Company was not successful in correcting the weakness, or making up for the weakness in another area, by looking at the first four years Net Revenue, Return on Equity, and Stock Price, which all steadily declined in the first four years, below investor expectations.
Resource Strength
Thompson, Peteraf, Gamble, and Strickland (2012) define a resource strength as something a company is good at doing or an attribute that enhances it’s