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Chapter 06 - Internal Analysis
6-1
distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in
whole or part.
Discussion Questions
Questions for Discussion
1. Describe SWOT analysis as a way to guide internal analysis. How does this approach reflect
the basic strategic management process?
SWOT analysis is a widely used technique where managers create a quick overview of a
company’s strategic situation. The basic premise behind SWOT analysis is that an effective
2. What are potential weaknesses of SWOT analysis?
Refer to the section in the text titled “Limitations of SWOT Analysis” for help with this
discussion. Consider four key limitations. First, a SWOT analysis can overemphasize
Chapter 06 - Internal Analysis
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distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in
whole or part.
3. Describe the difference between primary and support activities using value chain analysis.
The value chain framework divides a firm’s activities into two broad categories: primary
activities and support activities. Primary activities are those involved in the physical creation
of the product, marketing and transfer to the buyer, and after-sale support. Support activities,
4. How is VCA different from SWOT analysis?
Fundamentally, both VCA and SWOT analysis are internal analysis techniques that strategic
managers can use to evaluate their firm’s position. VCA differs from SWOT analysis,
5. What is the three-circles analysis, and how might it help doing internal analysis?
The three-circles analysis is a good way to articulate what a company’s competitive
advantage is and how it differs from those of competitors. As show in Exhibit 6.7, the first
6. What is the resource-based view? Give examples of three different types of resources.
The chapter describes the resource-based view (RBV) of the firm in which the basic premise
An example of a tangible asset, the first type of resource, would be the fleet of cars owned
Chapter 06 - Internal Analysis
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distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in
whole or part.
7. What are three ways resources become more valuable? Provide an example of each.
The following are the characteristics that make a resource more valuable:
Competitive superiority – example, Southwest Airlines’ low cost structure
8. Explain how you might use VCA, RBV, and SWOT analysis to get a better sense of what
might be a firm’s key building blocks for a successful strategy.
Whether applying the SWOT approach, VCA, or the RBV, strategists rely on three basic
perspectives to evaluate how their firms stack up on internal capabilities. The first is making
9. Attempt to apply SWOT, VCA, and RBV to yourself and your career aspirations. What are
your major strengths and weaknesses? How might you use your knowledge of these strengths
and weaknesses to develop your future career plans?
SWOT analysis is a good tool to use for self-evaluation. It allows for a systematic evaluation
of one’s strengths and weaknesses and helps one see how they can be used to develop one’s
