Business Model and Strategy Alignment with Resources and Capabilities

Key Concepts

• Resource: A competitive asset owned or controlled by a company.
• Capability: The capacity of a company to perform internal activities effectively.

Development and Expansion

• Long-term competitive advantage requires ongoing development of resources and capabilities.
• Organizational capabilities: Developed through resource deployment.
• Intangible resources: Human assets and intellectual capital are crucial for some capabilities.

Marketplace Impact

• The power of resources and capabilities is measured by their impact in the marketplace.

VRIN Tests for Sustainable Competitive Advantage

• Valuable: Does the resource/capability contribute to competitive advantage?
• Rare: Is it something competitors lack?
• Imitable: Is it hard to copy?
• Non-substitutable: Is it vulnerable to substitution?

Sustaining Competitive Power

• Resources must continually be strengthened, broadened, and deepened.
• Refreshing or modifying stale resources is essential.

Disruptive Environmental Change

• Can devalue key strategic assets.
• Management must recalibrate resources and capabilities continually.

Management Challenges

1. Recalibration of existing capabilities and resources.
2. Developing new capabilities for better customer value.

Dynamic Capabilities

• Ability to modify, deepen, or reconfigure resources and capabilities in response to changes.

Strategies for Sustaining Competitiveness

• Routine management to build new resource configurations.
• Maintain a dynamically evolving portfolio of resources and capabilities.