INTERNAL ENVIRONMENT ANALYSIS presentation

Strategic

1. INTERNAL ENVIRONMENT ANALYSIS

2. Introduction Strategic analysis of a business enterprise involves two stages: INTERNAL and EXTERNAL Internal analysis is the systematic evaluation of the key internal features of an organization.

3. Four broad areas to be considered for internal analysis:

4. RESOURCES

5. Internal Analysis

6. General Competencies/Capabilities

7. Core competencies/Distinctive Capabilities

8. Relationships between resources, capabilities and core competence

9. Global Value Chain Analysis Competitive advantage depends on the ability of the organization to organize its resources and value adding activities in a way that is superior to its competitors Value Chain Analysis is a technique developed by Porter (1985)for understanding an organization’s value-adding activities and relationship between them.

10. Value can be added in two ways:

11. The Value Chain The value chain is the chain of activities which results in the final value of a business’s products. Value added, or margin is indicated by sales revenue minus costs. Porter divided internal parts of organization into primary and support activities

12. PRIMARY ACTIVITIES are those that directly contribute to production of goods or services and organization’s provision to costumer. SUPPORT ACTIVITIES are those that aid primary activities, but do not themselves add value.

13. The Value Syste m The value chain of an individual organization provide an incomplete picture of its ability to add value. Many value-adding activities are shared between organizations often in the form of a collaborative network.

14. The ‘’Global’’ Value Chain

15. Managing the Value System