Organizational capability
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The document discusses organizational capabilities as a firm's ability to manage resources and people to achieve a competitive advantage. It outlines the importance of internal processes, flexibility, customer relationships, and a knowledgeable workforce in creating unique competencies. Additionally, the document details elements of capabilities, internal environments, types of capabilities, and the application of SWOT analysis for effective resource management.
Organizational capability
- 2. Organizational Capability The firm’s ability to manage people to gain competitive advantage. • focuses on internal processes and systems for meeting customer needs • creates organization-specific competencies that provide competitive advantage since they are unique • ensures that employee skills and efforts are directed toward achieving organizational goals and strategies
- 4. Importance • Competitive Advantage :- Organizational capabilities provide a company with an advantage in the marketplace. When an organization continues to create new capabilities and develops existing ones, it will maintain the advantage over its competitors. • Improved Customer Relationships :- Good customer relationships ensure the continued growth and competitiveness in the market.
- 5. • Flexibility and Responsiveness :- The responsiveness of an organization is its ability to change in response to customer demand • Knowledgeable Workforce :- The skills and knowledge of a company's workforce allow the organization to direct those skills to achieve the business's goals
- 6. Four elements of capabilities • Shared mindset • Management practices • capacity for change through understanding and managing organizational systems • Leadership at all levels in the organization
- 7. SHARED MINDSET • Common understanding and goals of ends (strategies) and means (processes, work systems, activities) • Congruence between customer and employee expectations
- 8. MANAGEMENT PRACTICES • Policies, programs, operating procedures, and traditions that guide work • Transform individual behavior to create customer satisfaction and consistency in how customer is treated • Complement and integrate with one another to create common expectations, behaviors, and goals
- 9. CAPACITY FOR CHANGE • Ability to reduce cycle time of all activities
- 10. LEADERSHIP • Owns passionately a vision which is promoted both within and outside the organization • Translates external conditions into vision for organization and how employee must act to attain vision • Empowers individuals at all levels within the organization to act within his or her domain
- 11. Internal Environment • The internal environment of an organization deals with the management of resources like human resources, physical resources, technology, monetary resources and others that constitute the organization in order to implement or execute a strategy.
- 12. Kinds of capabilities • Financial Capability Profile • (a) Sources of funds • (b) Usage of funds • (c) Management of funds • Marketing Capability Profile • (a) Product related • (b) Price related • (c) Promotion related • (d) Integrative & Systematic
- 13. • Operations Capability Factor • (a) Production system • (b) Operation & Control system • (c) R&D system • Personnel Capability Factor • (a) Personnel system • (b) Organization & employee characteristics • (c) Industrial Relations • General Management Capability • (a) General Management Systems • (b) External Relations (c) Organization climate
- 14. SWOT ANALYSIS • Identify & classify firm’s resources-S&W • Combine firm’s strength into specific capabilities – Corporate capability- may be distinctive competence • Strategy that best exploits the firms resources • Identify resource gaps & Invest in upgrading