Ism Lecture 5

Front 1

What is competitive advantage?

Back 1

When a firm can create more value than its rivals, and when this firm’s rivals cannot replicate the source of value that the firm creates

Front 2

How can you create competitive advantage?

Back 2

1.Market Based “Outside-In” Models
Porter-type models identify 5 market forces:
•The threat of entry
•The threat of rivalry
•The threat of substitutes
•The threat of powerful suppliers
•The threat of powerful buyers

2.Resource Based “Inside-Out” Models
-focus on the internal resources of a firm. The RBV suggests that it is unique clusters of resources that determine profitability.

Front 3

What are resources?

Back 3

-Factors that are owned or controlled by the firm.
-Inputs to carry out activities.
-Firm-specific assets, such as patents, trademarks, brand- name and reputation, culture, and specific knowledge.
-Not easily duplicated or acquired by other firms,

Front 4

What is the difference between tangible and intangible resources?

Back 4

-Tangible resources refer to the physical assets that an organization possess and can be categorized as physical, financial, or human.

-Intangible resources comprise intellectual and technological resources, as well as assets such as reputation, culture, knowledge and brands. Intangible resources are embedded in the routines and practices that have been developed by the firm, over time.

Front 5

What are the characteristics of capabilities?

Back 5

1. Valuable across multiple markets
2. Embedded in ‘organizational routines
3.They are tacit: they cannot be written down

Front 6

What is the VRIN-framwork?

Back 6

Resources can create a competitive advantage if they are:

-Valuable
-Rare
-Inimitable
-Non substitutable

Front 7

How can we sustain an competitive advantage?

Back 7

A competitive advantage is sustainable when it persists despite efforts by competitors or entrants to duplicate or neutralise it.

There are two types of isolating mechanisms:
(1) Impediments to Imitation
(2) Early-Mover Advantages

Front 8

Name four mechanisms of the impediments to imitation

Back 8

•Legal restrictions
•Superior access to inputs and customers
•Market size and Scale Economies
•Intangible Barriers to Imitation

Front 9

Name four mechanisms of the early mover advantage

Back 9

•Learning Curves
•Reputation and Buyer Uncertainty
•Buyer Switching Costs
•Network Effects

Front 10

What is Human Resource Management?

Back 10

Deals with decisions related to policies and practices, that shape the relationship between the firm and its employees.
It is suggested that :
(1)Human capital can be a source of competitive advantage;
(2)that HR practices have the most direct influence on the human capital of an organisation;

Front 11

What are four of the managerial issues that managers face regarding HRM?

Back 11

Challenge 1: The assignment issue
Challenge 2: The expatriates management issue Challenge 3: The localisation issue
Challenge 4: The global skills issue

Front 12

What can be reactions of an expat?

Back 12

1. Flight - isolated expat
2. Fight - militant expat
3. Fit - cosmopolitan expat
4. Follow - assimilated expat

Front 13

What are the three organizational roles for managers, according to Barlett and Goshal?

Back 13

1.Business Managers - operate in global business units, and further scale efficiency.
2.Country Managers - operate in local subsidiaries.
3.Functional Managers - sit at corporate or regional headquarters.

Front 14

What are the three layers of culture?

Back 14

1. Behavior
2. Values Beliefs and Preferences
3. Basic Assumptions and Meanings

Front 15

What are the four dimensions of culture?

Back 15

1. Corporate Culture
2. Industry Culture
3. Professional Culture
4. National or Ethnic Culture

Front 16

What are the four research categories?

Back 16

(1) Ethnological Research
(2) Managerial Values and Assumptions
(3) Country Clusters
(4) Cultural and Economic Differences

Front 17

Where does culture matter in corporate life?

Back 17

1. Marketing and Customer Communications
2. Human Resource Management
3. Partnerships (M&As etc)
4. Multi-Cultural Teams
5. Business Practices
6. Negotiations