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Dyson case study - Value chain, Resource Mapping and VRIO.

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Introduction

To: Dyson Date: 25.11.11 From: Sharif 1) Dyson Limited is a domestic appliance manufacturing company headquartered in the UK. Their product range includes vacuum cleaners, washing machines and hand driers. The value chain describes the categories of activities within and around the organisation, which together create a product or service. Value chain divides the company's activities. Therefore, it is a chain of value adding activities, where value 'is measured by the amount that buyers are willing to pay for a product or service' (Porter and Millar, 1985). Dyson can cut down the cost dramatically by the effective management of information system. Information technology is a powerful and efficient tool to reduce the documenting cost and can help in easy accessibility of information in various sections of the organization. The following Diagram shows The Dyson's value chain. Diagram: Information resource effects on Dyson value chain (source: modified from Porter and Millar (1985) If we look at the case study of Dyson we could say that the value chain of the primary activities of Dyson is that it has got an outbound logistics as it distributes its products around 45 different countries which is concerned with the cyclone technology. ...read more.

Middle

This initial set of four attributes was improved and later presented by Barney in the "VRIO Framework", which includes, also as necessity to gain competitive advantage, the firm's organization in exploiting the competitive potential of its valuable, rare and imitable resources. VRIO Framework Analysis Value One of biggest resources is its brand name. Brand awareness is an asset that possesses intangible value to the firm. Dyson already had many experiences in designing, manufacturing, and selling distinctive vacuum cleaners. Dyson has used these experiences and skills to exploit opportunities for stepping into the vacuum industry. Rareness Dyson`s product design is deeply embedded in engineering and got the capabilities which can function in a radically different way, which makes their products rare compared to competitors. Their unique model, the hand blade hand dryer which can wipe out water in seconds using less energy rather than evaporating as in standard hand dryers. Their resources are rare as Dyson hold the Patents, preventing other companies from using such technologies. Imitability Dyson considers that the combination of design engineering and manufacturing is crucial in developing and the most inimitable competences that can be protected through patents. Dyson is already holding the patents and copyrights in their technologies and designs. ...read more.

Conclusion

4) If we look at the value chain of Dyson we could see that Sir James Dyson is very crucial to the future of the company, because he is the head of the organisation where he controls all the primary and the supportive activities like technology development, procurement, inbound and outbound logistics, and market research that are part of an organisation`s culture. After analysing the VRIO it also could be seen that Sir James Dyson is very crucial to the company. The analysis of Dyson`s internal capabilities suggest that he has got a brand value, his developed products are rare in the market, it is also costly for the competitors to imitate and organised to exploit opportunities. So, according to the result of assessment it can be said that he is very crucial to the future of the company. The effect of Dyson leaving or selling the company will have a negative impact on the company because the competitors are following the strategy of Dyson. If this continues then they may lose distinctive competences and they may lose the whole business, because he is the only founder and developer of innovative ideas and engineering model. So, overall it can conclude that leaving Dyson or selling the company may lead the company in an unstable position. ...read more.

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