Resources and capabilities · • Differentiation and market penetration costs. • Legislation or...
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Kohtamäki, Marko Professor, University of Vaasa [email protected] +358 29 449 8459 School of Management
Transcript of Resources and capabilities · • Differentiation and market penetration costs. • Legislation or...
Kohtamäki, MarkoProfessor, University of Vaasa
[email protected]+358 29 449 8459
School of Management
How to conduct firm boundary decisions, integrate
and manage networks effectively?
https://www.researchgate.net/profile/Marko_Kohtamaeki
End-customer
segments
Governance
model
Public-service
company
Service company 1
Company
End-customer
segment 1
Government
Region
Service company 2
Company
Non-profit service
provider 1
Non-profit service
provider 2
End-customer
segment 2
End-customer
segment 3
End-customer
segment 4
Service
integrators
Service
companies
Service provider
company 15
Service provider
Non-profit 6
= Firm boundary /Organizational
boundary
Value, competition & relative bargaining
power
Customers
surplus
Producers surplus
(Economic Rent)
1. Intensity of competition (number & size Actual &
Potential; Substitutes; differentiation)
2. Customers Bargaining power (number & size)
Need & use value
(Value created)
Costs
incurred when
manufacturing
/ delivering
the service
Price the
customer
actually
pays
Maximum
price the
customer
would be
willing to
pay
1. Differentiation
Besanko et al., 2017
Santos & Eisenhardt, 2005
Central
Distinctive
Enduring
Product / service strategy
CustomerSegments
Mergers and acquisitions
Capabilities
Organizational identity
Michael Porter on 5 Forces:
https://www.youtube.com/watch?v=mYF2_FBCvXw
Who has the power?
Buyer Power
• Buyers are concentrated.
• Buyers have low switching
costs.
• Buyers can supply their own
inputs (backward vertical
integration).
• Low buyer profits (under
pressure to improve profits) and
the purchased inputs have a low
impact on quality
Threat of Substitutes
• The price/performance ratio
• The substitute benefits from an innovation that improves customer satisfaction
• Extra-industry effects. Porter, 1980
Entry Barriers
• Economies of
scale/Experience/Network effects.
• Access to supply and distribution
channels.
• Differentiation and market
penetration costs.
• Legislation or government restrictions
(e.g. licensing).
• Expected retaliation.
• Incumbency advantages.
Industry Rivalry
• Competitor concentration and
balance.
• Industry growth rate.
• High fixed costs.
• High exit barriers.
• Low differentiation.
Supplier Power
• The suppliers are
concentrated (few of
them).
• Suppliers provide a
specialist or rare input.
• Switching costs are high
(it is disruptive or
expensive to change
suppliers).
• Suppliers can integrate
forwards
Superior learning capability
Technology adaptation
Superior population data collection and
storage
Real-time management systems
ERP-systems, analytics and BI dashboards
Organizational culture and routines
Competences & skills
Brand
Machinery, tools & Facilities
Patents
Location
Superior diagnostics
Short lead-times
Proactive, customized people care
Resources and
competences
Processes/activities
Core capabilities
resources +
processes
Dynamic capabilities
Sensing, seizing &
reconfiguring
Lecturer’s elaboration on Barney (1991) and others
Limitedcustomer
service
Self-selection by customers
Modular furniture design
Low manufacturing costs
Knock-down kit packaging
Wide variety with ease of
manufacturing
Self-assembly by customers
Ease of transport and assembly
Explanatory catalogues,
informative displays and labels
Self-transport by customers
Suburban locations with ample parking
High-traffic store layout
More impulse buying
Most items in inventory
Ample inventory on site
Year-around stocking
100% sourcing from long-term partners
In-house design focused on costs of
manufacturing
Increased likelihood of future purchase
Limited sales staffing
Cost culture, Owner s example
Modular, Scandinavian design informal culture
Large shipments
Low-cost country suppliers Centralized
management of oprations
Developed based
on Porter and others
Lecturer’s elaboration from
Williamson 1985
Environmental
uncertainty
Relationship-specific
investments
Number of exchanges
Information asymmetry
Boundedrationality
Opportunism
Marketimperfection
Questions to consider Yes (buy) / No (make)
Who we are as an organizationCan we outsource without endangering our unique identity?
Who has the powerCan we outsource without significant loss of power?
Where are we best at Can we outsource without sacrificing our core capabilities?
Should we make or buyDoes the total costs (pc+tc < pc) decrease as a result of outsourcing?
Sum of points?
Alliance capability
• Comprehensive construct including all
the sub-dimensions
• Mediating and moderating effects
Alliance management
capability
• Alliance target setting
• Task implementation
• Alliance evaluation
Alliance integration
capability
• Improvement of relational
embeddedness
• Development of alliance structures
Alliance learning
capability
• Knowledge creation
• Knowledge assimilation
• Knowledge internalization
Organizational
outcomes
• Complementary resources
• Learning and innovation
• Environmental and sustainability
performance
• Competitive advantage
Relational
outcomes
• Long-term relationship
• Value creation
• Joint action
• Alliance success and performance
Financial
performance
outcomes
• Market performance
• Sales level & growth
• Profitability
• Stock market returns
Environmental
characteristics
• Environmental uncertainty
• Environmental hostility
Organizational characteristics
• Business strategy
• Strategic orientation
• Offerings
• Top management
commitment & incentives
• Buyer-side leadership
• Supplier collaboration
readiness
• Organizational culture
• Information technology
• Employee satisfaction
• Access to resources
Relational characteristics
• Relationship governance
• Mutual dependence
• Partner complementarity
• Cultural distance
Antecedents Processes Outcomes
Kohtamäki, M., Rabetino, R., & Möller, K. (2018). Alliance capabilities: A systematic review and future research directions. Industrial Marketing Management, 68(1), 188–201.
Antecedents, processes and outcomes in network management
Relationship management/
steering group
Relationship
development teams
Relationship
IT systems
Mutually agreed practices
Joint
sense-making
Knowledge
integration
Knowledge
sharing
Supplier’s
relational
investments
-Site investments
-Dedicated personnel
-R&D tools
Customer’s
relational
investments
-Test facilities
-R&D tools
-Dedicated personnel
-Financing
Embedded
relational capital
Huikkola, T., Ylimäki, J., & Kohtamäki, M. (2013). Joint learning in R&D collaborations and the facilitating relational practices. Industrial Marketing Management, 42(7), 1167–1180.
How to conduct firm boundary decisions,
integrate and manage networks effectively?
Marko KohtamäkiUniversity of Vaasa, Department of Management
PO Box 700, FI-65101 Vaasa, FinlandTel: +358 29 449 8459
E-Mail: [email protected]
