EVALUATING COMPANY'S RESOURCES, CAPABILITIEAS, AND COMPETITIVENESS

           In this chapter we learn about company resources, capabilities, and competitiveness. This three element is very important for every company because this element is a main thing to have before we can start our business. Before we proceed to the main discussion, let me give the definition of resources, capabilities and competitiveness. 

          Resource means an economic or productive factor required to accomplish an activity, or as means to undertake an enterprise and achieve desired outcome. Three most basic resources are land, labor and capital. Other resources include energy. entrepreneurship, information, expertise, management and time. Capability means a measure of the ability of an entity (department, organization, person, system) to achieve its objectives, specially in relation to its overall mission. last but not least, competitive means good, service, or offer that can hold its own against competing product because its offer an attractive value for money proposition to its buyer. This three element need to be evaluate so that we can form a good and excellent business strategy. Starting a business by evaluating the firm's internal situation which include resources, capabilities and competitiveness as stated below:

1. How well is the firm's present strategy working?
2. What are the firm's competitively important resources and capabilities?
3. Is the firm able to take advantage of market opportunities and overcome external threats to its external well-being?
4. Are the firm's prices and cost competitive with those of key rivals, and does it have appealing customer value proposition?
5. Is the firm competitively stronger or weaker than key rivals?
6. What strategic issues and problems merit front burner managerial attention?

A success strategy comes from an excellent planning. How do we find out that our planning is success? there are specific indicators of strategic success which is growth in firm's sales and market share, increasing profit margins, net profits, ROI, growing financial strength and credit rating and many more.

In this chapter also we learnt about SWOT analysis which is powerful tool for sizing up a firm's. SWOT analysis stand for Strength Weakness Opportunity and Threats. Strengths and weaknesses analyze the internal factor of the company, for the external factor we analyze the threats that occur. An opportunities come from the business market.

Beside SWOT analysis, Miss Ummi also taught us about value chain. This is another way to analyze the company strategic management but in terms of internal activities happened. Value chain analysis examine the value chain of an enterprise to ascertain how much and at which stage value is added to its goods and/or services, and how it can be increased to enhance the product differentiation (competitive advantage).

Company Value Chain

Beside SWOT and value chain analysis, benchmarking also tools that we can use to evaluate the internal activities of company. Benchmarking is a measurement of the quality of an organization's policies, products, programs, strategies and their comparison with standard measurement or similar measurement of its peers. The objectives of benchmarking are:

1. to determine what and where the improvement
2. to analyze how other organizations achieve their high performance levels
3. to use this information to improve performance.