Please read this memo before you begin preparing case report 2 related to First Solar A CRITICAL FACT This case is available free on line from MIT's Sloan School The URL is https mitsloan mit edu sites default files 2020 03 First 20Solar IC pdfLinks to an external site As you prepare your second case report, identifying First Solar's core competencies, please keep some things in mind A core competency is a very special capability It is something the firm can DO Express it as something the firm can DO It is much more than a resource or something the firm has A core competence is a very special capability It is special because it allows or helps a firm perform one or more of a range of activities that create something unique and valuable that someone would miss if it were not available and that no one could replace perfectly That is, it gives the firm sustained competitive advantage, economic returns superior to competitors' That unique and valuable offering means a firm achieves economic performance superior to its competitors That means that the core competence lets the firm make more money than its competitors Case exhibits will show several ways that First Solar outperforms competitors For each superior measure, think about 1) whether the way First Solar surpasses competitors may logically contribute to superior economic performance and 2) what CAPABILITY creates that superior performance The question asks how likely the core competence is to contribute to sustained competitive advantage and why That means you need to show that the core competence, that very special capability, is truly and fully VIRUS Valuable Does it make, create or save money for the firm How Difficult or impossible to imitate If it is so important, could or could not a competitor do the same thing Why Keep in mind reasonable time frame Most things can be imitated over time, but may take a while Expressed another way, sustained competitive advantage does not necessarily mean forever Rare Are others or many others doing the same thing Non substitutable Does the business really need this or is there a strategically equivalent substitute Look for things that First Solar can do that are revenue sources themselves or lead to revenue sources You will find things other than simply making solar panels You may conclude that these other capabilities are revenue sources themselves, that they enhance solar panel sales and that they create income competitors do not enjoy (See Exhibit 9 for income detail ) Competitive advantage, the result of core competencies, means economic advantage superior to others Exhibit 9, comparative financial statements, allows comparing First Solar's results to competitors' First Solar's superior margins are apparent Look further, however, for an income source that may indicate First Solar exploits another capability The PV market is segmented as the case describes Segments have differing needs which the case also describes Please think about whether any First Solar capability is especially valuable in a specific segment and associate the core competence capability with the relevant segment You may find it helpful to think of the various tangible and intangible resources and reflect upon the capabilities to which those resources contribute Of course, resources need to be used together to create capabilities, but a resource may suggest a capability If a capability that you identify does not meet all the VIRUS standards, it is not a core competence Name another one Sometimes a firm may have many capabilities that in combination are a core competence Remember that competitive advantage generally comes from a range of activities that in totality give superior economic performance, Each capability alone may be short of being a core competence, yet the combination is so complex that it supports a range of critical activities and therefor is a core competence The core competency is the combined capability and not any single capability Firms have relatively few core competencies If you have a bunch, think about it Be hard headed Write well Use the guidelines in the case instructions and that you received with case 1 A good topic sentence gets you going correctly Think about starting with One First Solar core competence was its ability to

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Jul 06, 2024

Please read this memo before you begin preparing case report #2 related to First Solar. A CRITICAL FACT: This case is available free on- line

Please read this memo before you begin preparing case report #2 related to First Solar.

A CRITICAL FACT:

This case is available free on- line from MIT's Sloan School. The URL is:

https://mitsloan.mit.edu/sites/default/files/2020-03/First%20Solar.IC_.pdfLinks to an external site.

As you prepare your second case report, identifying First Solar's core competencies, please keep some things in mind:

A core competency is a very special capability. It is something the firm can DO. Express it as something the firm can DO. It is much more than a resource or something the firm has.
A core competence is a very special capability.It is special because it allows or helps a firm perform one or more of a range of activities that create something unique and valuable that someone would miss if it were not available and that no one could replace perfectly. That is, it gives the firm sustained competitive advantage, economic returns superior to competitors'.
That unique and valuable offering means a firm achieves economic performance superior to its competitors. That means that the core competence lets the firm make more money than its competitors. Case exhibits will show several ways that First Solar outperforms competitors. For each superior measure, think about 1) whether the way First Solar surpasses competitors may logically contribute to superior economic performance and 2) whatCAPABILITYcreates that superior performance.
The question asks how likely the core competence is to contribute to sustained competitive advantage and why. That means you need to show that the core competence, that very special capability, is truly and fully VIRUS.
- Valuable- Does it make, create or save money for the firm? How?
- Difficult or impossible to imitate- If it is so important, could or could not a competitor do the same thing? Why? Keep in mind "reasonable time frame". Most things can be imitated over time, but may take a while. Expressed another way, "sustained competitive advantage" does not necessarily mean forever.
- Rare- Are others or many others doing the same thing?
- Non substitutable- Does the business really need this or is there a strategically equivalent substitute?
Look for things that First Solar can do that are revenue sources themselves or lead to revenue sources. You will find things other than simply making solar panels. You may conclude that these other capabilities are revenue sources themselves, that they enhance solar panel sales and that they create income competitors do not enjoy. (See Exhibit 9 for income detail.)
Competitive advantage, the result of core competencies, means economic advantage superior to others. Exhibit 9, comparative financial statements, allows comparing First Solar's results to competitors'. First Solar's superior margins are apparent. Look further, however, for an income source that may indicate First Solar exploits another capability.
The PV market is segmented as the case describes. Segments have differing needs which the case also describes. Please think about whether any First Solar capability is especially valuable in a specific segment and associate the core competence capability with the relevant segment.
You may find it helpful to think of the various tangible and intangible resources and reflect upon the capabilities to which those resources contribute. Of course, resources need to be used together to create capabilities, but a resource may suggest a capability.
If a capability that you identify does not meet all the VIRUS standards, it is not a core competence. Name another one.
Sometimes a firm may have many capabilities that in combination are a core competence. Remember that competitive advantage generally comes from a range of activities that in totality give superior economic performance, Each capability alone may be short of being a core competence, yet the combination is so complex that it supports a range of critical activities and therefor is a core competence. The core competency is the combined capability and not any single capability.
Firms have relatively few core competencies. If you have a bunch, think about it. Be hard headed.
Write well. Use the guidelines in the case instructions and that you received with case 1. A good topic sentence gets you going correctly. Think about starting with "One First Solar core competence was its ability to ..."