Resource Availability: Land, Labor, Capital, and Technology


What does your business need to implement your strategy? What is the resource availability and cost? Where can you get them? The nature of how we do business is shifting continually. Managers are continuously identifying less expensive and more productive resources. The shift is from domestic tightly controlled resource pools to global, virtual, and option-oriented environments. Manufacturers locate themselves in cheaper markets to minimize production costs and environmental restraints. For example, companies are opening software development facilities in Ireland and India due to the availability of skilled labor at a lower cost.

The flow of capital continues to become more global. Investment in foreign markets is growing, and global investors are increasing their holdings in the U.S. As capital flows are facilitated, firms are pressured to deliver results because investors can easily move into other investments.

As the demand for technology increases, the investment required to obtain state-of-the-art technology is becoming prohibitive. Many businesses have reduced technology costs through outsourcing (contracting with a third-party service provider). Businesses have restrained the growth of production costs through reengineering and increased use of technology. This is a critical element of success. Intensified competition in mature markets has left little room for price increases to improve profits.

Resource availability changes with market demand. Demand for resources increases as markets grow, which puts more pressure on managers to acquire and retain resources. Many managers view resource management as a cost containment issue. This view is shortsighted because it does not focus on increasing value, but on reducing cost. The reality is that continued cost reduction without top line (revenue improvement) is a strategy that will put a firm out of business.




Translating Strategy into Shareholder Value. A Company-Wide Approach to Value Creation
Translating Strategy into Shareholder Value: A Company-Wide Approach to Value Creation
ISBN: 0814405649
EAN: 2147483647
Year: 2003
Pages: 117

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