When Delta Air Lines wants to study Continental Airlines, it must examine both Continental and its complementor, Star Alliance

Chipotle linked fresh ingredients with the marketing and training of employees to build customer service as a capability. This example illustrates the way in which resources must be combined in order to form capabilities

By themselves, resources can allow firms to create value for customers as the foundation for earning above-average returns

An example of a government policy barrier to entry would be a scenario in which the Antitrust Division of the Department of Justice disallows a merger because it creates a firm that is too dominant and would thus create unfair competition

Analyzing the internal environment enables a firm to determine what it MIGHT DO by identifying what opportunities and threats exist

Because recessions and recoveries follow certain patterns, firms can study the economic environment to predict economic trends. This was particularly valuable in dealing with the recovery after the global recession of 2008-2009

Strategic groups are firms in different industries following the same or similar strategies

Switching costs, access to distribution channels, economies of scale, large numbers of competing firms, and slow industry growth are some of the entry barriers that may affect the threat of new entrants to an industry

A competitor’s capabilities can be measured by studying its current strategies and future objectives

The competitor analysis is the final part of the external environment analysis and focuses on each company against which a firm directly competes (for example, Coca-Cola and PepsiCo, Home Depot and Lowe’s, and Airbus and Boeing)