Home Free Lab ReportsGroup Assignment SN Members Full Names Registration Number 1 NAJMA NDASIWA

Group Assignment SN Members Full Names Registration Number 1 NAJMA NDASIWA

Group Assignment

SN Members Full Names Registration Number
1 NAJMA NDASIWA …………………………………
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Questions
1. Analyze eBay’s strategic capability using an analytical framework (s) from the Chapter
2. What are the capabilities that have provided eBay with competitive advantage and why?
3. Using the concepts of sustainability and dynamic capabilities, how would you manage this capability (create new resources and competencies, invest/divest in others, extend others) given:
(a) New entrants in the marketplace?
(b) The changing nature of eBay.

?
1.0. Introduction
The competitive nature in today’s business environment is making business organizations irrespective of their nature and size to adopt strategic management. This involves thinking and decisions by managers in the formulation and implementations of skillful plans of actions designed to achieve a long-term or overall aim (Gupta, 2005; Osita et al., 2014).The strategies formulated enable managers to answer questions on ‘how’ a particular activity should be done and ‘how’ a particular objective should be achieved (Porter, 1990). The eBay in specific is greatly involved in strategic management in the provisions of online selling and buying services in the competitive environment. This is manifested in the Chapter about eBay’s businesses, management and cooperation and competition. The next sections attempts to analyze eBay’s strategic capability and identify the capabilities that have provided eBay with competitive advantage.

2.0. eBay’s Strategic Capability
The strategic capability refers to a business ability to successfully employ competitive strategic that allows it to survive and increase its value overtime (David, 2013). It is perceived to be the main ingredient to the business organization in remaining financially viable in the presence of intense competitors (Porter, 1990). It is pointed that strategic capability focuses on organization’s assets, resources and market position. The information on strategic capability of the organization is needed by a number of stakeholders for different purposes. For instance, investors before investing their money into the organization needs assurance on future success and growth of the organization to avoid losses, employees needs to know financially stability and business leaders uses it to track position in relation to its competitors (Gupta, 2005). By using the analytical frameworks which normally identifies how an artwork contains a number of different aspects, the strategic capability of eBay is analyzed as follows:

2.1. eBay’sAssets
Asset is any item of economic value which could be converted into money. They are of two categories: tangible assets having a physical form such as raw materials for products, machines, infrastructure, or money and intangible assets/capabilities having no physical existence such as: a science of knowing what to do, relations with the clients, technology of information and databases, patents, trademarks, and copyrights, as well as abilities and innovations of the employees. According to Porter (1990) assets are crucial for organization’ capability and they are differentiators of superior performances and success among organization. eBay own a number of assets contributing to its superior performance and success which pointed out by Shepherd (nd: p1), in the Chapter as:

(a) Finances generated from online selling and buying services,
(b) Creativity manifested by new ways of doing businesses;
(c) Good relationship with customers created by listening what they want, convening meetings and making discussions
(d) Reputations by automatic control over actions and behaviors of sellers and customers.

2.2. eBay’s Resources
Resources are typically the assets involved in daily operations of the organization. They are also essential determinants of organization’s strategic capability. Gupta (2005) classified them as: physical resources such as the machines, buildings or the production capacity of the organization, financial resources such as capital, cash, debtors and creditors, and suppliers of money (shareholders, bankers, etc.), human resources represents leaders, employees and other people in an organization’s networks and intellectual resources such as patents, brands, business systems, reputation and knowledge and customer databases. According to Shepherd (nd), eBay’s resources are:
(a) Information database enabling tracing customers and yielding information on their behaviors and wants;
(b) Information Communication Technology enabling online selling and buying;
(c) Teleconferences for online meetings, workshops and classes with customers;
(d) Expertise knowledge, skills and experience in business identification and solving emerging problems;
(e) Creative and innovative leaders enabled creation of eBay Motors in 1999, etc. (p.2);
(f) Webpages;
(g) Skilled and experienced employees;
(h) Partnerships/Collaborations with Skye, Yahoo, Google and Baidu Inc.
2.3. eBay’s Market Position
It includes market share, e.g. number of customers or markets served by the organization and its position in the competitive market. The market position and strategic capability of the organization are positively related. According to Chapter by Shepherd (nd), eBay covers global market. By 2006 there were about 200million eBayers across the globe. eBay continued to cooperate with global online service provides such as Skye, Yahoo, Google and BaiduInc to facilitate provisions of online selling and buying services.

3.0. Capabilities that have provided eBay with Competitive Advantage
According to David (2013) capabilities capable to provide competitive advantage to the organization must be difficult to imitate and they are typically intangible. Effective use of these capabilities places the organization on the supervisor position over its competitors. Following observations by David (2013), the following capabilities provide competitive advantages to eBay because they are intangible hence difficult to imitate by its rivals such as GMarket:
(a) Creation and innovation enabling eBay coming up with new ways of doing businesses;
(b) Reputations created by automatic control on actions and behaviors of sellers and customers
(c) Skilled and experienced employees contributing in finding solutions to the business, etc.
(d) Creative and Innovative leaders. Example, creation of eBay Motors in 1999 (p.2);
(e) Expertise knowledge, skills and experience in the business identification and solving emerging problems;
(f) Information database enabling tracing customers and yielding information on their behaviors and wants.

4.0. Ways in which sustainability and dynamic capabilities are useful to manage the unique capability in dealing with new entrants and the changing nature of eBay.

Sustainability refers to a process by which organization manages their financial, social and environmental risks, obligations and opportunities (Gupta, 2005). On the other hand, dynamic capability is defined byTeec et al..(1997) as the ability of the organization to integrate, build and re-configure internal and external competence to address rapidly changing environment. According to them, there are main three dynamic capabilities for organization to meet adapt new challenges: abilities of employees to learn quickly and build new strategic resources, the integration of these new assets (new capability, technology and customer feedback) into organization’s process and transformation or re-use of existing assets which have depreciated.

Sustainability needed to enhance proactive use of organization’s finances needed in managing unique capabilities such as creativity and innovation of new ways of doing businesses and recruitment and retention of skilled and experienced employees capable to find out solutions on how the organization may deal with new entrants. Also, it is needed in the changing nature of eBay to ensure optimally use of available resource to the sake of the present and future requirements in online selling and buying services.

Dynamic capability is needed to enhance learning and applications of the suitable unique capabilities by eBay following entry of new firms. This is because; new entrants come with different technologies and performances. So, learning of new business environment and capabilities of the entrants is needed to assist in the application of the most suitable capability to cope with changes hence defeat the entrants. Still, dynamic capability is needed to determine the unique capability to be integrated and re-configured to match with changing nature of eBay over time.

Conclusion ; Recommendation

References
David. F.R. (2013).Strategic Management.Concepts and Cases. 14thEdt. Pearson Education Ltd Publishers

Porter, M. (1990).”Competitive Advantage of Nations”. Harvard Business Review

Gupta, C.B., (2005). Corporate Planning and Policy. New Delhi: Sultan Chand and Sons Educational Publishers.

Osita, I.C., Idoko, O.R., and Justina, N. (2014).”Organization’s stability and productivity: the role of SWOT analysis an acronym for strength, weakness, opportunities and threat”. International Journal of Innovative and Applied Research (2014), Volume 2, Issue (9): 23- 32

Shepherd, J. (nd).”Making eBay Work.Segal Graduate of Business Simon Fraser University, Canada.
Teec, D. Pisano, G &Shuen, A. (1997). “Dynamic Capabilities ; Strategic Management”.

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