The reading was about the Business level strategy focused on“strategy from inside out” and key elements of this strategy. The author discussed the elements and application of the strategy by providing the real case studies examples of “Citi Bank” and “Shahana”. In the Citi Bank’s case, the CEO Reed, found the key factors which made Citi Bank different from the rivals in the industry. The CEO also found that Citi Bank lacked in providing services to Multinational Companies and was focused only to the Local customers. The author also explained that company should obtain competitive advantages of technology, processes, designs, relationships and other intangible properties which are hard to be imitated. He further mentioned that by searching out these advantages, the firm should focus on these factors to obtain sustainable competitive advantage over competitors.
The author mentioned the example of Shahana, a software company that developed software which was compatible to two different types of operating system. Shahana took this competitive advantage and made every effort to grow this competitive edge. The author termed this advantage as “Asymmetries”.
It was also explained how the difference of processes and designs of a company may be converted into a valuable asset and how these could be converted into company’s capabilities. The author mentioned three imperatives of inside-out strategy. Firstly, he discussed how to discover Asymmetries. Then he described some factors to be considered while discovering these Asymmetries. He narrated that the firm should search out to know how it can beat its competitors by screening the capabilities of the competitors. Secondly, he discussed how to create capabilities by designing the processes and combination of resources. He then described the two types of capability configuration and the advantages of such configuration. Regarding the implementation of this strategy, he discussed how to purse the market opportunities so that a firm would be able to capture and exploit these opportunities.
The implications of this strategy for the managers were also explained. He told that it is hard for the manager to discover and develop the required capabilities and direct these capabilities to exploit right opportunities.
The writer discussed the inside out strategy of strategic management. He discussed how this strategy can be use as at business level strategy to exploit market opportunities and to obtain sustainable competitive advantage.
I have identified some of the points as criticism to this paper. I think the compatibility of resources and processes should be further explored in detail by presenting some more case study examples. Further, the paper was also silent about how the firm can implement this strategy in the short-run. The whole strategy required many processes and steps which could be difficult for a company to implement in rapidly changing competitive business environment.
I have found the Shahana Case study as most interesting in this article as the case study truly described the main idea of ‘inside out strategy’ for developing a sustainable competitive advantage.
I have found the “virtuous cycles” the most difficult part of the article as it took me a lot of time to read and comprehend the topic. It was difficult for me to fully comprehend it how virtuous cycles don’t allow companies to build sustainable competitive advantage.