24 Chapter II Literature Review This chapter will focus on discussing what theoretical foundation and conceptual framework that the author used for developing this final project. Literature review is a critical evaluation and synthesis of existing research and scholarly works relevant to a specific research topic. It seeks to deliver a comprehensive overview of the current state of knowledge, identify gaps in the literature, and establish a theoretical framework for the research. (Machi, 2016) II.1 Theoretical Foundations The theoretical foundations are a set of principles that underpins a research study, guiding its direction and providing a basis for interpreting findings. It is derived from established theories and concepts in the relevant field and serves as a lens through which the research problem is analyzed. For this project, the author use several theoretical foundations for Xray Fluorescence, Internal analysis, External analysis and determine the strategy using SWOT and TOWS analysis. II.1.1 Xray Fluorescence Xray fluorescence (XRF) is an analytical technique used to determine the elemental composition of materials. The method relies on the principle that individual atoms, when excited by an external energy source, emit X-rays at characteristic energies unique to each element. This makes XRF a powerful tool for qualitative and quantitative analysis of elemental compositions in a wide range of samples (Jenkins, R. 1999). In the context of nickel mining, XRF operates on the 25 same fundamental principles as general XRF analysis. When the nickel ore is irradiated with high-energy X-rays, atoms within the ore are excited, causing the ejection of inner-shell electrons. This process creates vacancies that are filled by electrons from higher energy levels, resulting in the emission of secondary X-rays. These emitted X-rays have energies characteristic of the specific elements present in the ore, including nickel. (Jenkins, R. 1999). With XRF instruments, mining companies could determine how many percent are nickel content presented in their nickel ore. This is very important, determining how many percent nickel content means determines how much the price is their nickel ore, therefore XRF is a vital instrument, each mining company needs this instrument minimum 1 unit. II.1.2 VRIO Analysis The VRIO framework is a strategic analysis tool used to evaluate the resources and capabilities of an organization to understand its competitive advantage. VRIO stands for Value, Rarity, Imitability, and Organization. This framework helps in determining whether a resource or capability can be a source of sustained competitive advantage (Barney, J. B. 1991). This framework is a crucial tool to assess the potential of the company’s resources and capabilities in creating and sustaining competitive advantages. VRIO stands for Value, Rarity, Imitability and Organization, within this framework we could assess the company’s value, such as technological expertise and customer relationships, the rarity of the product, the imitability of the product and the most important thing is to assess the organization itself, whether if PT Rindu Makmur has effective supply chain, skilled workforce, infrastructure. After 26 determining the resource, The author will use VRIO framework by (Grant R, 2014) which will give a code “Y” if the resource is categorized as Yes and “N” if the resource is categorized opposite. If the resource has 4 “Y” then the resource is categorized as Sustainable Competitive Advantage (SCA). If the resource has 2-3 “Y” then the resource categorized as Temporary Competitive Advantage (TCA). If the resource only has 1 “Y” the rest is “N” then the resource categorized as Competitive Parity (CP). The author will test the assumptions underlying these criteria and validate my findings through empirical evidence, such as surveys and interviews with current and potential customers. II.1.3 STP Analysis Kottler (2016) stated that Segmenting, Targeting, and Positioning (STP) is a fundamental marketing framework that helps businesses identify and target specific segments of the market to position their products or services effectively. The STP model is instrumental in developing marketing strategies that cater to the needs and preferences of distinct customer groups, thereby enhancing market competitiveness and achieving business goals. The author used this theory for internal analysis, to analyse what is PT Rindu Makmur’s segment, the target and product position. (Kottler, 2016) By applying the STP framework, an XRF distributor can effectively identify distinct customer groups, tailor marketing efforts to meet the specific needs of these groups and position their offerings to achieve competitive advantage. Segmentation involves dividing a broad market into smaller, distinct groups of customers who have similar needs, preferences, or characteristics. For an XRF sole agent 27 distributor, market segmentation could be based on geographic, company size and number of samples. To strengthen the theoretical grounding of my thesis project, I will clearly define the segmentation criteria for XRF user especially on nickel mining companies. These criteria such as by region, size of the company, and the ownership. Additionally, I will test the assumptions underlying these criteria and validate my findings through empirical evidence, such as surveys and interviews with current and potential customers. This approach will enhance the credibility and practical relevance of my research, ensuring that the developed value proposition is based on a solid theoretical foundation and a deep understanding of customer needs. II.1.4 Stakeholder Analysis The concept of stakeholder analysis is introduced as a key component in understanding the strategic environment of a business. The traditional view of business strategy, which primarily focused on profit maximization and shareholder value, by emphasizing the importance of considering a broader network of stakeholders who can impact or be impacted by a firm’s operations. Stakeholders are any individuals or groups who can affect, or are affected by, the achievement of an organization’s objectives. The types of stakeholders divided into two main groups: Primary Stakeholders: Those who have a direct impact on the organization and without whose continued participation the firm cannot survive (e.g., employees, customers, suppliers). Secondary Stakeholders: Those who influence or are influenced by the 28 organization but are not directly involved in its core operations (e.g., media, NGOs, trade associations). Stakeholder mapping is a process used to identify and prioritize stakeholders based on their power, interest, and influence on the organization’s strategic outcomes. Freeman suggests using tools like the power-interest matrix to classify stakeholders into four quadrants: • High Power/High Interest: Key players to be managed closely. • High Power/Low Interest: Keep satisfied. • Low Power/High Interest: Keep informed. • Low Power/Low Interest: Minimal effort required.