Critical evaluation organization's Resources and Capabilities of Coursework - 1

Critical evaluation organization's Resources and Capabilities of Starbucks in China. (internal environment) - Coursework Example In the case of Starbucks an effective Resources strategy should focus on the employment of unique resources so that a competitive advantage is acquired towards the firm’s major competitors. The potentials of Starbucks to develop such advantage is analyzed below by referring to the firm’s performance in regard to each of the elements of the Resource-based theory. 1.1 Tangible Resources The tangible resources of organizations are assets that have a physical existence; the buildings in which business operations are developed and the cash available to the business are assets of this kind (Sehgal 2010). In China, as in all countries worldwide, Starbucks is characterized by specific features as of the style/ decoration of its stores and the dinnerware sets/ cups used for serving the customers (Starbucks Coffee International 2013). However, these features are not unique since they can be identified, with differentiations, in other brands operating in the same sector. According to Wang (2012) the interior of Starbuck’s stores across China is unique not only in regard to decoration but also as of the chairs available to customers and the style of music chosen; in this context, it is noted that the stores of Starbucks in China offer to the business a unique competence towards the competitors (Wang 2012). 1.2 Intangible Resources The intangible resources of a business do not have a physical existence; intellectual property rights that the business have in regard to its products and the brands that the business owns are common examples of intangible resources (Sehgal 2010). For achieving a high competitiveness through its intangible resources, a firm needs to periodically update those resources, according to the market trends. The example of Toyota that developed Lexus as a separate brand so that it is able to increase its competitiveness in the luxury cars sector is important for understanding such practice (Sehgal 2010, p.44). In the above case, Toyo ta would not be able to enter this sector without the employment of a unique resource, such as the new brand (Sehgal 2010, p.44). 1.3 Human Resources Human resources can also lead to competitive advantage if they are unique (Rao and Sivaramakrishna 2009). The uniqueness of these resources would be related to a variety of issues, such as the quality of training, the hiring/ selection process or the performance appraisal (Rao and Sivaramakrishna 2009). In Starbucks employees are given the training that it is commonly available to the sector’s employees; also, no unique feature seems to exist in regard to the firm’s selection/ hiring process or the skills/ competencies of employees (Starbucks Coffee International 2013) 2.0 Starbucks’s Capabilities strategy in term of Value chain At the next level, the Capabilities strategy of Starbucks should be also reviewed. Porter’s Value Chain model could be used for evaluating the specific strategy of Starbucks. Accordi ng to Porter (2008) the activities of each organization contribute, more or less, to the development of products/ services that ‘are valuable to their buyers’ (Porter 2008, p.38). These activities can be categorized into ‘