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5
Analyzing Resources and Capabilities

Analysts have tended to define assets too narrowly, identifying only those that can be measured, such as plant and equipment. Yet the intangible assets, such as a particular technology, accumulated consumer information, brand name, reputation, and corporate culture, are invaluable to the firm’s competitive power. In fact, these invisible assets are often the only real source of competitive edge that can be sustained over time.
—HIROYUKI ITAMI, MOBILIZING INVISIBLE ASSETS

You’ve gotta do what you do well.
—LUCINO NOTO, FORMER VICE CHAIRMAN, EXXON MOBIL

OUTLINE l Introduction and Objectives l The Role of Resources and l Organizational Capabilities Classifying Capabilities The Architecture of Capability l Appraising Resources and Capabilities Establishing Competitive Advantage Sustaining Competitive Advantage Appropriating the Returns to Competitive Advantage l Putting Resource and Capability

Capabilities in Strategy Formulation
Basing Strategy on Resources and Capabilities Resources and Capabilities as Sources of Profit l The Resources of the Firm Tangible Resources Intangible Resources Human Resources

Analysis to Work: A Practical Guide
Step 1 Identify the Key Resources and Capabilities
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PART II

THE TOOLS OF STRATEGY ANALYSIS

Step 2 Appraising Resources and Capabilities Step 3 Developing Strategy Implications l Developing Resources and Capabilities The Relationship between Resources and Capabilities Replicating Capabilities Developing New Capabilities Approaches to Capability Development

l Summary l Self-Study Questions l Appendix: Knowledge Management

and the Knowledge-based View of the Firm l Notes

Introduction and Objectives
In Chapter 1, I noted that the focus of strategy thinking has been shifted from the