Electrolux 1 Case Study - Electrolux Dountan Coulibaly BUSN/313 November 20 th , 2016
Electrolux 2 Case Study - Electrolux As a company that was established in the year of 1919, Electrolux has experienced a significant and steady growth. Today, Electrolux retails products to more than 150 markets. Particularly, some of the products that are designed by Electrolux include electro domestics such as washing machines, dryers, dishwashers, vacuum cleaners, and several others. According to Electrolux, the company experienced a slight decline in profits, but was able to raise again as a competitive company (2013). It is highly important for a company such as Electrolux to remain competitive in this difficult market. Use Barney’s VRIO framework to analyze the competencies of Electrolux. Discuss whether AB Electrolux can compete with local Chinese consumer manufacturers. In 1999, Barney, J.B. developed a tool, namely VRIO framework, used to analyze and examine particular measurements that determine the competency of a particular firm and its capability to obtain a sustained competitive advantage (Jurevicius, 2013). There are many variables to consider when using this framework, such as the value of its resource, rarity, cost for other entities to step in, and lastly the organization of the company. Given that the four of these aspects are satisfied, VRIO framework considers the resource to be able to generate sustained competitive advantage for the firm. Using Barney’s VRIO framework, knowing that Electrolux has an ability to manage its employees effectively is both a source of differentiation and a cost advantage for the business.
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