VRIO Analysis of Air France-KLM-Alitalia-Etihad Of Growth in Alliances B

The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B is exposed to, as well as has ownership of different resources. The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B uses these resources for meeting its goals, as well as for developing and expanding different growth opportunities. The VRIO analysis is used by the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B for assessing and evaluating these resources to help leadership and management to identify different strengths and weaknesses, and work towards using the same to enhance the business standing and proposition (Knott, 2015).

VRIO importance

More importantly, the VRIO analysis is used by the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B to evaluate and identify the different competitive advantages that different resources can offer. In doing so, the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B is able to identify resources that offer a long-term sustainable competitive advantage, and work towards building the same for increased opportunities (Chatzoglou, Chatzoudes, Sarigiannidis, & Theriou, 2018). Air France-KLM-Alitalia-Etihad Of Growth in Alliances B VRIO analysis is a strategic tool that allows the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B to identify resources that offer a temporary competitive advantage – allowing the company to strategize tactics to then turn these into factors of long-term competitiveness.

The VRIO analysis largely assesses resources as being Valuable, rare, inimitable, and organized.

Valuable

Resources are valuable if they allow the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B to enhance its efficiency and effectiveness through facilitating strategy implementation and realization. Moreover, resources are also valuable if they allow the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B to successfully manage the threats it is exposed to, and capitalize on different opportunities through helping build internal strengths, and manage weaknesses appropriately (Lasserre, 2017). Some examples of valuable resources for Air France-KLM-Alitalia-Etihad Of Growth in Alliances B include the following:

Strong global presence

The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B has a presence across various international locations and countries. The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B has expanded its manufacturing operations across different countries in Asia and Europe. The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B uses these manufacturing sites as central supply locations and hubs for different regions as well (Abratt & Bendixen, 2018).

Branch network

The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B has a strong branch and store network across different regions in various international locations – including the UK, USA, China, and Australia, and across Europe. The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B has developed its store network in locations that offer the company high visibility, and promise a high customer footfall (Baines, Fill, & Rosengren, 2017).

Supply chain management

Owing to the global presence, and international operations, the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B also has an internally managed supply chain network. The supply chain network ensures consistently high quality, and timely manufacture and delivery of the products offered by the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B to retailers, distributors, as well as end consumers (Chernev, 2018).

Risk management

The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B has developed an internal means and system for identifying, managing, and mitigating environmental risks and threats. These risks include fluctuation in prices of raw materials, as well as political instability in regions where it operates. The internal risk management system for Air France-KLM-Alitalia-Etihad Of Growth in Alliances B comprises of continuous observation of the environment, and development of proactive strategies, as well as training of its personnel for responding to the same (Deepak & Jeyakumar, 2019).

Technological advancement

The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B makes use of technological advancement for achieving economies of scale. The presence across various global locations has allowed the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B to develop a seamless technological infrastructure for knowledge sharing. Air France-KLM-Alitalia-Etihad Of Growth in Alliances B is also able to implement processes of improvement internally (Iacobucci, 2021).

Use of AI

The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B also makes use of AI for improving internal efficiencies and processes as well as for improving the consumer experience. The use of AI internally has allowed the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B to reduce the error rates, and improve logistic management, for example.

User experience

The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B focuses on enhancing the user experience for maintaining loyalty. The use of AI especially has allowed the company to improve the user experience through providing 24/7 customer support, as well as developing relevant purchase prompts for consumers based on their browsing histories (Sahaf, 2019).

Customer service

The customer service offered by Air France-KLM-Alitalia-Etihad Of Growth in Alliances B is an important and valuable resource that helps the company differentiate its offerings from that of the competition. The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B offers 24/7 online support to consumers, and has a team of trained personnel for providing customer services on physical locations (Gillespie & Swan, 2021).

Research and development

The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B makes a substantial investment in research and development. The research and development allows the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B to stay updated with the market and consumer trends – thereby allowing the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B to tailor its offerings and marketing efforts accordingly. The research and development also allows the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B to improve its production processes, and improve efficiency levels continuously (Grewal & Levy, 2021).

Product offering

The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B focuses on maintaining consistent quality for its product offerings. Moreover, the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B also ensures that the product offerings meet the consumer needs and demands. For this purpose, it engages in the localization of its product offerings across different regions and locations (Abratt & Bendixen, 2018).

Financial resources

The financial resources and capability at the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B allows minimum dependence on debt. The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B has a higher dependence on equity for expansion and development purposes. This ensures lower vulnerability of the company, and gives the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B increased freedom and independence for pursuing business objectives and goals (Groucutt & Hopkins, 2015).

Marketing activities

The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B engages in marketing activities for appealing to its target audience across different countries and regions. The marketing communication is tailored to take into account different cultural considerations across these locations and regions. Moreover, the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B ensures to appeal to the functional as well as emotional fronts of the consumers - using insights from its research and development activities (Kotler & Keller, 2021).

Rare

Rare resources for the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B are those which are not easily and readily available for the competing players. These resources are rare for the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B because of the firm’s unique position and access to the resources – which is otherwise difficult and challenging to acquire. This makes rare resources cost-intensive for other organizations (Phillips & Moutinho, 2018).

Manufacturing and distribution licenses

Air France-KLM-Alitalia-Etihad Of Growth in Alliances B has gained special licensing permissions for manufacturing and distribution in various regions ad countries – some of which are more remote and stringent towards international firms. The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B has been able to do so based on its strong team of lawyers and policy interpreters, as well as because of the goodwill it has developed over the years (Kotler & Keller, 2021).

Access to raw materials

Air France-KLM-Alitalia-Etihad Of Growth in Alliances B has access to different raw materials that support its quality maintenance of product offerings. The access to raw materials for the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B is largely based on the company’s unique position and its investments in research and development. Both of these have allowed the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B to substantially develop its capabilities (Buchanan & Huczynski, 2019).

Equipment

The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B has access to world-class equipment. This equipment and technology is not readily and easily available to its competing players. The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B has access to this equipment for increasing efficiency, and improving economies of scale based on its vast operations, and partnerships with various regional governments (McShane & Glinow, 2017).

Intellectual property

The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B has multiple policies regarding intellectual property, and thoroughly implements policies and regulations regarding the same internally. In addition, the company also follows external regulations for intellectual property protection. This allows the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B to sustain its creativity and successfully continue to experiment with new product ideas (Chernev, 2018).

Patents

The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B has different patents registered under its name. This is done by the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B to safeguard its innovative capacities, and maintain regulated intellectual property rights. This helps the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B stay ahead of the competition, and secure new technology and ideas to maintain the first mover, and unique competitive advantage over other players (Wunder, 2019).

Sustainable manufacturing

Based on its unique environment for development and innovation, as well as because of its engagement with advanced technology and equipment, the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B has developed processes for successful sustainable manufacturing. This resource allows the company to appeal to green consumers, and at the same time, maintain higher internal efficiencies and profitability (Tonelli & Cristoni, 2018).

Eco-packaging

The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B is also successfully engaging with, and producing eco-based packaging. This resource is important for the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B, and allows it to improve its processes as well as brand perception. Competing players do not have access to the needed intellectual property, ideas, or machines to successfully, and efficiently apply this to their internal business processes and offerings (Tonelli & Cristoni, 2018).

Inimitable

Inimitable resources for the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B are those which are hard and costly to copy and imitate by other players, and competitive rivals in the industry. Inimitable resources offer a long-term competitive advantage to Air France-KLM-Alitalia-Etihad Of Growth in Alliances B. Air France-KLM-Alitalia-Etihad Of Growth in Alliances B has different resources that are hard to imitate, or are perfectly inimitable largely because of factors of historical context; and unique historical conditions; causal ambiguity, and/or social complexity (Stead & Stead, 2014).

For Air France-KLM-Alitalia-Etihad Of Growth in Alliances B, a number of resources are inimitable because of their uniqueness to the company itself. These include:

Organizational culture

The organizational culture is unique to the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B – developed through the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B’s core values and beliefs, as well as its structure and managing style. The culture of the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B leads to improved employee performance, and facilitates organizational success (Abbas, 2017).

HRM policies and activities

The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B has also built a strong HRM department internally which supports the business, and its strategies. This support is extended through various HRM functions such as hiring, and training activities and opportunities. These activities are aligned with the business goals and strategic direction for ensuring high organizational performance, and the right talent match for the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B (Mariappanadar, 2019).

Compensation Framework

The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B also has a unique compensation system to support internal activities and functions. The compensation system is rooted in employee motivation and needs. The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B invests in understanding the needs of the employees, and then designs rewards accordingly- linking them with the job responsibilities and tasks (Mariappanadar, 2019; DuBrin, 2013).

Brand equity

The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B has developed strong brand equity over time. The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B has successfully, and continually delivered on its brand promise by providing high quality offerings. This has allowed the buildup of consumer trust as well as positive brand perception leading to higher brand equity for Air France-KLM-Alitalia-Etihad Of Growth in Alliances B (Kotler & Keller, 2021).

Brand loyalty

The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B has a high brand loyalty. Based on its offerings, quick customer service, and after-sales service, the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B has developed a high brand loyalty amongst customers. These customers conduct repeat purchases of the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B’s offerings and products because of higher satisfaction levels (Baines, Fill, & Rosengren, 2017).

Brand awareness

The marketing activities of the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B are carefully tailored and targeted, and based on the emotional appeal that the company provides in its offerings to the customers. This in turn leads to a positive buzz. The viral buzz, as well as positive marketing efforts, have led to high brand awareness for the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B amongst not only its own target customers, but also amongst secondary groups (Sahaf, 2019).

Goodwill

Air France-KLM-Alitalia-Etihad Of Growth in Alliances B has continually delivered on its promise, and has thus developed a positive brand perception. As a result of this, the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B has built positive goodwill over the years. This goodwill allows the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B to confidently launch new products in the market that consumers readily accept and consume (Grewal & Levy, 2021).

Innovation

The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B continually engages in innovation and creativity as well. The company has a team for business development that engages in the process of new product design and development. The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B also invests in the creative development of its employees for facilitating and encouraging new idea generation, and emphasizes on employee empowerment for the same purpose (McShane & Glinow, 2017).

Organizational leadership

The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B has a supportive leadership. The leadership style at Air France-KLM-Alitalia-Etihad Of Growth in Alliances B is participative which encourages discussion, and creates trust and a positive work environment. In addition, the leadership at Air France-KLM-Alitalia-Etihad Of Growth in Alliances B is transparent and accessible, and works closely to improve and build the organizational culture through promoting core beliefs and values (Schein, 2010).

Employee commitment

The employees at the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B display high levels of job satisfaction. This is because the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B continually engages the employees with challenging tasks, trainings for personal and professional development, as well as motivational work responsibilities and teamwork. This results in increased levels of job satisfaction amongst employees of Air France-KLM-Alitalia-Etihad Of Growth in Alliances B, leading in turn to high levels of employee commitment (Mariappanadar, 2019).

Branding activities

The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B invests in branding activities for building its brand as well as a positive consumer perception. These branding activities for the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B involve not only the marketing communications, but also the development of a suitable marketing mix for the company. The branding activities help the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B increase brand awareness, as well as increase its reach and penetration amongst the target audience (Iacobucci, 2021).

Organized

The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B is able to capitalize on different opportunities based on the various resources available to it through being organized. This factor of the strategic framework evaluates and assesses how organized and structured the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B is. The factor also reviews how the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B is able to benefit from the various resources that are available to it towards building sustainable competitive advantage (Chatzoglou, Chatzoudes, Sarigiannidis, & Theriou, 2018; Stead & Stead, 2014). This part of the strategic framework for the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B allows it to identify and examine different resources it has closely to be able to optimally benefit from them.

Physical infrastructure

One of the best ways through which the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B is able to capitalize on the various internal and external opportunities is through the development of its physical infrastructure. The infrastructure of the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B allows it to develop economies of scale as well as enhance its various manufacturing and operational processes (Buchanan & Huczynski, 2019).

Technological infrastructure

The technological infrastructure of the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B allows it to benefit from the latest technological trends such as the inclusion of artificial intelligence and automation in its operational processes and schedules. The technological infrastructure has facilitated the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B to improve its production and efficiency rates as well as reduce its errors. The technological infrastructure also led the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B to benefit from potential advancements such as social media marketing and e-commerce (DuBrin, 2013).

Network support

The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B is able to further benefit from consuming of various resources available through the presence of a strong internal network. This network includes not only the physical and technological infrastructure but also the organizational network and alignment of operations locally and globally. This coordination and network allows the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B to realize its strategic goals (Phillips & Moutinho, 2018).

Training and development

As the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B is exposed to new resources and builds on old resources, it is important to update the skills of the employees. The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B continually invests in the training and development of its labor force. This ensures that the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B stays ahead of the competition.

The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B maintains frequent internal training and development opportunities to help the growth of employees and improve their performance (Mariappanadar, 2019; Stead & Stead, 2014).

International Exposure

The growth and expansion of the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B and its business along international fronts have given it considerable exposure to understand different cultural requirements and operational details. This exposure is important for the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B to allocate resources accordingly towards different regions and production sites; and manage them in the most efficient and effective manner possible (Kotler & Keller, 2021).

International learning

The international exposure that the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B also enables increased sharing of knowledge across borders. This knowledge sharing and knowledge development allows continuous learning internally for the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B. This learning then helps the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B to work towards to the development of strategic structures within the organization as well as design more sophisticated management styles and tools to improve the management of resources (Daneshmandnia, 2019).

Organizational hierarchy

Optimization of the resources available to the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B is because the organization has a flatter hierarchy which leads to easier access to the leadership and quicker decision-making processes. This enables higher employee empowerment and participation as well as leads to increased organizational commitment and responsibility (Deepak & Jeyakumar, 2019).

Supportive leadership

The leadership of the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B is largely supportive and ensures the development of the management team and the employees. The support of the leadership within the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B allows space for quicker decisions as well as makes room for capitalizing on the opportunities and mitigating risks accordingly. This in turn allows for improved Resource management and optimization (Schein, 2010).

Effective change management processes

The Air France-KLM-Alitalia-Etihad Of Growth in Alliances B engages all employees in the change management process and ensures that there is transparent communication regarding the need as well as the implementation of the same. This allows the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B to manage resources more effectively as well as build on other resources to help the company achieve its strategic and business objectives and goals (Pollack & Pollack, 2015).

Conclusion

The VRIO assessment is an important strategic tool that allows the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B to identify various resources which can lead to different forms of competitive advantages. The VRIO assessment and model allows the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B to identify resources that can be used for developing sustainable competitive advantage over the long term as well as allows the Air France-KLM-Alitalia-Etihad Of Growth in Alliances B to invest in, and build other resources for the same purpose.

In addition, the strategic tool allows managers of the company to identify resources which can lead to competitive disadvantage. As such the VRIO assessment is an important source of resource evaluation as well as identification of the same.

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