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Canada (161,650)
MGSB22H3 (6)
Chapter 2-10

Chapter 2-10 for final exam

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Department
Management (MGS)
Course
MGSB22H3
Professor
Bill Mc Conkey
Semester
Fall

Description
Chapter 2 Resources and Capabilities Why do entrepreneurs need a theory of entrepreneurship y Saves time and money y Recognizes what kinds of information are helpful y Translates raw information into usable data y Explains how things and event are related and probable direction of causality y Explains timing and sequencing of events y Allows user to be efficientResourcebased Theory of Entrepreneurship y Also known as Resourcebased View RBV y Focuses on strengths assets and capabilities of entrepreneursy Incorporates market opportunity industry structure and competition y But emphasizes resources skills and capabilities What is a resource y Any thing or quality that is useful y Can be tangible or intangible y Can be propertybased or knowledgebased y Is semipermanent or stickyit adheres to the venture and the entrepreneur y Often used interchangeably with capital and assetWhat is a skill y The ability to do something useful y An proficiency that is often developed through training or experience y A talentWhat is a capability y A socially complex routine that determines the efficiency of physical transformations of inputs into outputs y A talent or ability that has the potential for development or future useOrganizations have 3 types of capabilities y Functional capabilities y Dynamic improvement capabilities y Entrepreneurial capabilitiesFunctional capability y A socially complex routine that determines the efficiency of physical transformations of inputs into outputs y A talent or ability that has the potential for development or future useDynamic improvement capability y The ability to learn and innovate y Enables the organization to change and to be responsive and flexible y Some firms can learn to learn o Therefore they have less need for specific capabilities because o They can easily adapt to changeEntrepreneurial capability y The ability to deploy a firms resources or position those resources for action y The ability to develop new strategic resources Sustainable Competitive Advantage SCA Meaning the entrepreneurs firm is able to create and capture value and protect it against erosion from competitionAccording to resourcebased theory sustainable competitive advantage SCA is created when a firm has resources and capabilities that are VRINVRIN Model Resources and capabilities that are Valuable Rare Imperfectly imitable NonsubstitutableValuable because they exploit some environmental opportunityRare because there are not enough for all competitorsImperfectly imitable because competitors cannot easily duplicate them often described as hardtocopyNonsubstitutable with other resourcesCompetitive advantage a valuecreating strategy not simultaneously being implemented by any current or potential competitorsvsSustainable Competitive Advantage a valuecreating strategy current or potential competitors are unable to duplicateWhy is VRIN important Firms with resources that are Valuable Rare Imperfectly imitable Nonsustitutable are best equipped to have a Sustainable competitive advantage SCA over timeWhat makes a resource valuable y Helps the organization implement its strategy effectively and efficiently y Exploits opportunitiesminimizes threats
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