Tutorial Part C (Chapter 2)

Question 1
Importance of analyzing and understanding the firms external environment:
- The external environment influences the firms strategic decisions and
options
- Understanding of the external environment is useful when its matched
with the knowledge about its internal environment.
- In order to form the vision, mission and take strategic actions in the
pursuit of strategic competitiveness and above-average returns, the
firm has to match the conditions of both external and internal
environment
- Its important for firm to understand the external environment in order
to compete in the global economy.
- For example, technological changes in information gathering and
processing capabilities requires more timely and effective competitive
actions and responses.
- rapid sociological changes occurring in many countries might affect the
the labor practices and the nature of the products.
- governmental policies and laws affect where and how firms choose to
compete.

Question 2
Seven segments of the general environment
- Demographic segment focuses on the population size, age structures,
geographic distribution, ethic mix and the income distribution.
- Economic segment focuses on macroeconomic issues, including
inflation, interest and unemployment, and the overall health of the
economy.
- Political or Legal segment focus primarily in government action such
as taxes, trade policies, antitrust law and government stability.
- Sociocultural segment focuses on demographics, including short-
term and long-term cultural such as quality of worklife, concerns about
environment and career preferences.
- Technological segment focuses on technological changes in the
market such as product innovations, growth of internet and new
communication technologies.
- Global segment focus on the global focusing such as the geopolitical
trends, global niche market, growth of the economy and the diverse
culture and institutional attributes.
 - Physical segment focus on environment such as emerging trends in
sustaining the worlds physical environment, recognition of the
interactive influence of ecological, social, economic systems plus the
growing concerns of the sustainable industry development and
increased corporate social responsibility.

Question 4
What and why do firm need to know their competitors:
- Desk research, field research, commercial agencies.
- Desk research is using the existing information from the public and
industry publications.
- Field research, collect and gather the information by surveys, such as
questionnaire and research tools.
- Commercial agencies are hiring the external company or organizations
that carry out the research.
Why firm need to know their competitors,
- Because its might can reduce the threat to the firm, firm must know
and understand the competitors in the market are selling the similar
product or service,
- must understand their way to generates sales and attract customers
and promotions to attract consumers.
- Understand competitors can make the own firm product or service and
marketing stand out.
- It will enable to let the firm set the prices competitively and help to
defeat the competitors threat.
- Example, understands the competitor how they distribute and deliver,
how they create value to their brand, and research about the annual
report, and their media activities. All of these can help the firm prevent
to lost their customers by the competitors firm. SWOT analysis is a
useful way to assess the firm stand what and which position in the
market relation to competitor.
Tutorial Part C (Chapter 3)
Question 1
The Importance of Internal Analysis to the strategic success of the firm:
- By analyzing its internal environment, a firm determines what actions it
can take based on its unique resources, capabilities and core
competencies. The firms core competencies are the source of the
firm-s competitive advantage.
- Internal analysis allows the firm to compare what it is capable of doing
(what it can do) with what it might do (which is a function of
opportunities and threats in the external environment).
- Matching what a firm can do with what it might do allows the firm to
develop its vision, pursue its strategic mission, and select and
implement its strategies. This allows the firm to leverage its unique
bundle of resources and capabilities to gain competitive advantage
Question 2
Differences between tangible and intangible resources. And which is more
valuable:
- Tangible resources are those assets that can be observed and
quantified.
- There are four types of tangible assets: financial resources (borrowing
capacity, ability to generate internal funds); physical resources (plant
and equipment, access to raw materials); techno-logical resources
(patents, trademarks, copyrights, and trade secrets), and
organizational resources (formal reporting structure, planning,
controlling and coordinating systems).
- Intangible resources are those assets in the firm that are less visible.
- There are three types of such resources: human resources (knowledge,
trust, management capabilities, and organizational routines), resources
for innovation (ideas, scientific capability, and capacity for innovation),
and reputation (reputation with customers, i.e., the firms brand name
and perceptions of product quality, and relationships with suppliers).
- Intangible assets develop over time and are deeply rooted in the
organizations history. Thus, it is difficult for competitors to analyze and
imitate. In addition, intangible resources can be leveraged to create
 new value to the firm. These properties give intangible resources a
greater ability to create sustainable competitive advantage than do
tangible resources.

Question 3
Capabilities. How it affects the firm strategic success:
- Capabilities exist when resources have been purposely integrated to
achieve a specific task or tasks. For example, human resource
activities, product marketing, and research and development.
- Capabilities are based on developing, carrying, and exchanging
information and knowledge through the firms human capital.
- Many of the firms capabilities are based on the unique skills and
knowledge of its employees and their functional expertise.
- The knowledge possessed by human capital is among the most
significant of a firms capabilities.
- Capabilities are often developed in specific functional areas (such as
manufacturing or marketing) or in a part of a functional area (e.g.,
advertising).