Chapter 4 Worksheet The purpose of the internal analysis is to assess the competitive capabilities and resources of the company under analysis For each strategic factor throughout the worksheet you should conclusively state if the factor is a strength or a weakness This will strengthen your analysis and help you with your subsequent SWOT analysis 1 How well is the current strategy working page 95 In this section you must address the criteria and the how well question simultaneously For example if the company uses a broad differentiation strategy as their present strategy how well is the differentiation strategy working for the company For a broad differentiation strategy I would expect you to cite examples of adding value for the customer and other stakeholders Then I expect you to determine how well they are implementing the strategy Criteria What are the present strategies Note This question applies to the corporate business and functional levels of the organization Choose one of the five generic strategies discussed in Chapter 5 Assess the company s relative performance using the three tests for a winning strategy Refer to Chapter 2 pages 68 and 69 Goodness of fit Competitive advantage You must answer question 2 below before analyzing the company s competitive advantages Performance You must address the objectives question and financial analysis question below before you analyze the company s performance Facts What does this mean To address GOF you must analyze the SWOT If the majority of the intersections are in the S O quadrant the company has a good fit For the CA test you must first complete question 2 in Chapter 4 Your responses to the four tests of competitive value determine whether or Thompson Arthur and Strickland A J Strategic Management Concepts and Readings McGraw Hill Irwin NY 15th Edition Chapter 4 Worksheet 1 not the company passes the CA test For the performance test you must examine the company s actual performance Look at their financial ratios and their relative performance When you have the facts it is much easier to conduct your analysis What is the company s competitive scope stages of the industry s production distribution chain it operates geographic market coverage and size and composition of the customer base Please add other facets of competitive scope as necessary You are supposed to examine the company s competitive scope from the perspective of how the competitive scope is a competitive capability within the overall framework of how well is the current strategy working From your analysis identify the particular strengths or weaknesses associated with the competitive scope strategy What are the functional strategies Production Marketing Finance Human resources R D Etc Start by listing the functional areas then provide the facts associated with each of the areas Finally conduct your analysis and determine how well the functional areas are working and the associated Thompson Arthur and Strickland A J Strategic Management Concepts and Readings McGraw Hill Irwin NY 15th Edition Chapter 4 Worksheet 2 strengths and weaknesses You are supposed to examine the company s functional strategies from the perspective of how the strategies provide a competitive capability within the overall framework of how well the current strategy is working You are supposed to determine the strengths or weaknesses associated with the strategies Determining the strategy is working is the first step Your analysis of why is the strategy working or not working will identify the strengths or weaknesses Has the company achieved its financial objectives Determine if they achieved their short and long term objectives and provide the supporting analysis why they did or did not achieve the objective Then you are in a position to determine the associated strengths or weaknesses Has the company achieved its strategic objectives Determine if they achieved their short and long term objectives and provide the supporting analysis why they did or did not achieve the objective Then you are in a position to determine the associated strengths or weaknesses What is the company s position relative to EACH of its competitors Market share Profit margin Net profits ROI EVA page 9 MVA page 10 Financial strength Thompson Arthur and Strickland A J Strategic Management Concepts and Readings McGraw Hill Irwin NY 15th Edition Chapter 4 Worksheet 3 Sales growth Image Reputation Industry position Please add other facets of relative position as necessary If the strategy is not working is it due to Weak strategy and or Poor implementation 2 What are the company s resource strengths and weaknesses page 97 The purpose of this tool is to assess the competitive values of the company s resources The four tests of competitive value pages 123 124 are Is the resource hard to copy How long does the resource last Is the resource really competitively superior Can the resource be trumped by a rival s resources capabilities If you can answer the first three questions in the affirmative and the last question with a no then decide if the resource is the basis for a competitive advantage As a minimum for each of the resource types listed below assess the competitive value of each resource To address the resource strengths and weaknesses question you must answer all four questions for each of the criteria For example answer all four questions for proprietary technology Then answer all four questions for advertising and promotion Continue with the same approach for each of the criteria You must also provide solid logic and analysis in your responses Why are you answering yes or no to each of the four questions After completing your analysis you can determine if the company under analysis has CAs or strengths Please identify all of competitive advantages All of the CAs are strengths A company may have a resource strength that is not a CA Identify all of the company s strengths and weaknesses Criteria Facts What does this mean Please note the following criteria are examples to get you started You should add the applicable resources for each category Skills and expertise Proprietary technology advertising and promotion product innovation ability to improve production processes technological know how Physical assets plant capacity plant and equipment age Thompson Arthur and Strickland A J Strategic Management Concepts and Readings McGraw Hill Irwin NY 15th Edition Chapter 4 Worksheet 4 and technological capabilities plant and