Chapter 4

The Internal Assessment

Strategic
Management:
Concepts & Cases
11th Edition
Fred David

Ch 4 -1
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 Nature of an Internal Audit

Basis for Objectives & Strategies

Internal strengths/weaknesses
External opportunities/threats
Clear statement of mission

Ch 4 -2
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 Internal Audit

Parallels process of external audit

Information from:
Management
Marketing
Finance/accounting
Production/operations
Research & Development
Management Information Systems

Ch 4 -3
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 Resource Based View (RBV)

Approach to Competitive Advantage

Internal resources are more important

than external factors

Ch 4 -4
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 Resource Based View (RBV)

Three All Encompassing Categories

1. Physical resources
2. Human resources
3. Organizational resources

Ch 4 -5
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 Resource Based View (RBV)

Empirical Indicators

Rare
Hard to imitate
Not easily substitutable

Ch 4 -6
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 Integrating Strategy & Culture

Organizational Culture

Pattern of behavior developed by an

organization as it learns to cope with its
problem of external adaptation and
internal integrationis considered valid
and taught to new members

Ch 4 -7
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Integrating Strategy & Culture

Values

Legends Beliefs

Cultural
Heroes Rites
Products

Symbols Rituals
Myths

Ch 4 -8
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Management
Stage When Most
Function Important
Planning Strategy Formulation

Organizing Strategy Implementation

Motivating Strategy Implementation

Staffing Strategy Implementation

Controlling Strategy Evaluation

Ch 4 -9
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 Marketing

Customer Needs/Wants for Products/Services

1. Defining
2. Anticipating
3. Creating
4. Fulfilling

Ch 4 -10
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 Marketing
Marketing Functions

1. Customer analysis
2. Selling products/services
3. Product & service planning
4. Pricing
5. Distribution
6. Marketing research
7. Opportunity analysis

Ch 4 -11
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 Finance/Accounting
Finance/Accounting Functions

1. Investment decision (Capital budgeting)

2. Financing decision
3. Dividend decision
4. Financial analysis Key financial ratios

Ch 4 -12
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 Production/Operations

Production/Operations Functions

Process
Capacity
Inventory
Workforce
Quality

Ch 4 -13
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 Research & Development

Research & Development Functions

Development of new products before

competitors
Improving product quality
Improving manufacturing processes to
reduce costs

Ch 4 -14
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 Management Information
Systems

Information Systems
CIO/CTO
Security
User-friendly
E-commerce

Ch 4 -15
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 Ch 4 -16
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 Ch 4 -17
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