Strategic Management: Atlassian Case Study Analysis Report

This report provides a comprehensive strategic analysis of Atlassian Corporation Ltd. The analysis begins with an executive summary and introduction, outlining the report's purpose, importance, and analytical approach. The report delves into the macro environment using the PESTEL model, assessing political, environmental, social, technological, economic, and legal factors impacting Atlassian and the IT services industry. An industry analysis employing Porter's Five Forces evaluates the industry's life cycle stage and attractiveness. The company analysis utilizes the VRIO framework to identify Atlassian's core competencies, resources, and capabilities. Furthermore, the report includes a competitor analysis, examining resource similarity and market commonality. Finally, the report analyzes Atlassian's business-level strategies, identifying opportunities for strategic adjustments. The report concludes with a summary of findings and a reference list.

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Strategic management- Atlassian case study
Name of the Student:
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Executive summary:
In the current paper, extensive research has been conducted for evaluating the overall
performance and determining the core competencies, resource and capabilities of Atlassian
Corporation Ltd. The report prepared has been divided into five sections which demonstrates the
macro analysis, micro analysis, company analysis, competitor’s analysis, strategy analysis. The
overall analysis has made use of several frameworks for analysing the overall industry and
changes in trend impacting the organization.

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Table of Contents
Introduction:....................................................................................................................................2
Discussion:.......................................................................................................................................2
Macro environmental analysis:........................................................................................................2
Industry analysis of Atlassian..........................................................................................................2
Company analysis of Atlassian........................................................................................................2
Competitor analysis of Atlassian:....................................................................................................2
Strategy analysis of Atlassian:.........................................................................................................2
Conclusion:......................................................................................................................................2

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Introduction:
The report is prepared to demonstrate the environmental analysis of Atlassian
organization using different framework such as PESTEL and VRIO. Industry analysis has been
done for identifying the life cycle stage of the industry in which the company is operating using
Porters five forces. In addition to this, the core competencies of the organization are identified by
determining the capabilities and resources. Analysis of the competitors of Atlassian has been
done by conducting the resource similarity analysis and market commonality. In the part of the
strategy analysis, all the strategies at the business level has been identified for seeking any
changes in the current strategies adopted by the organization.
Discussion:
Macro environmental analysis:
This section of the report evaluate the factors creating impact on the company and the
industry as a whole using PESTEL model which is a strategic tool is used for analyzing the
macro environment in which the company is operating. The Atlassian Corporation limited along
with other companies operating in the information technology services can be directly impacted
by the change in the macro environmental factors.
Political factors- The political factors that has affected the performance of Atlassian
includes the changes such as election of president of United States and Brexit. It is so because
the US dollar have strengthened while weakening the foreign currencies due to these two
political events. It is considered optimistic for Atlassian as the various costs is incurred in foreign
currencies where the company carry out its operation and solely accept payment in US dollar.

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Hence, changes in the political scenario in the recent years tends to positively influence the
organization.
Environmental factors- Change in the climatic condition is one of the environmental
trend that affects the performance of company and the company using their corporate social
responsibility initiatives does the environmental management. As a rule, software companies are
green and have two inputs that is electricity and human (Hitt et al. 2015).
Social factors- Some of the ongoing social events include the acceptance of all people
and trend of inclusion. Atlassian considered themselves a proponent of inclusion for all and they
are being vocal about it. This is positive for Atlassian, as they would become attractive to all the
customers supporting these values.
Technological factors- The performance of Atlassian is impacted by change in the
segment of technology such as X-as-a-service business models and cloud computing. In light of
these trends, companies are required to develop digital products in order to stay relevant.
Atlassian can increase its total number of potential customers is targeting the software
development teams for its product (Atlassian 2019).
Economic factors- The growth trajectory of the company is impacted by the change in
the economic factors of the country such as inflation, growth and consumer spending.
Legal factors-The performance of Atlassian can be negatively impacted by the potential
trend in the legal segment and the laws of cyber security can be one of the possibilities. With
maturity, the higher security standards could influence the delivery and product development of
Atlassian. In addition to this, expenses for the organization could also shoot up because of

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proposed increased import tariff by the US government as the products of Atlassian are subjected
to such laws.
Industry analysis of Atlassian
The life cycle stage of the industry in which the company is operating and its
attractiveness is evaluated by using the Porters five forces.
Supplier’s power- Suppliers bargaining power enjoyed by the technological companies
such as Atlassian is high and employees are the main input of the Software Company and
competition for skilled workers are extremely competitive and thereby suppliers can negotiate in
terms of the salary, price and benefits package. A careful balance has been strike between
adapting to the changes and the strategy development (Crick and Chew 2017).
Buyer’s power- Buyer enjoy medium bargaining power and because of higher switching
cost, they traditionally have low power due to the schedule, cost and vast scope of
implementation of enterprise software. The power of buyer has been inversely raised due to
deployment of new model of monthly subscription of cloud software that causes lower cost of
switching (Meyer 2017).
New entrants’ threat- The threat of new entrants for Atlassian is medium because
creating the product is that would gain attraction is somewhat difficult and entrance in the
industry is easy as there is low initial cost of investment. Moreover, for the long-term survival in
the tech industry, the only viable option is the widening stream of revenue. For the survival, it is
required by the companies to outpace their competitors in evolving high growth areas such as
data analytics, cyber security and cloud computing (Hanson et al. 2016). There would be

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continuous fall in the barriers to entry and there would be rapidly rise in the privately funded
companies.
Competition within the industry- Atlassian Corporation operates in an industry, which
is a very competitive technology services and the long-term profitability of the company is
impacted by this intense competition. The leaders in the technological industry are the companies
with the highest growth potential and in the platform of so-called Xaas sector, which includes
application, platforms, delivery and infrastructure (Underwood 2017). The software industry
faces high competition because of the saturation of the market resulting from the maturity of the
industry.
Threats of substitutes- The software industry faces medium threat from the substitute
products as the industry is reaching its stage of maturity and for any imaginable price range,
industry and task, there are availability of several enterprise software solutions. The substitute
for small and medium enterprise business also acts as a substitute because of their ability to
create homegrown solution using the tools such as Microsoft excel and word (Ethiraj et al.
2016).
Company analysis of Atlassian:
The sustained competitive advantage of Atlassian can be assessed by employing the
VRIO framework that would analyze its internal resources and capabilities to determine its
competencies.
Valuable- The unique culture of company is the most crucial internal strength along with
the expansive efforts of knowledge management. Atlassian is changing the thought of

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distribution and promotion as greater percentage of revenue are spent on building of greater
products and marketing. The strategy of word of mouth marketing adopted by the organization
has helped in building a substantial base of customers and community of users for advocating
their own solutions and brand. This has caused to build the brand with relatively low marketing
cost and sales. The overall enduring value of capabilities sand resources for Atlassian is
relatively low along with the low durability of their resources. The current rate of obsolescence
for web-enabled technology is estimated to be of mere twelve months as mentioned in the article
of Forbes. Values are also captured from the products due to the integration and gaining the
customers through the relationship. One of the enduring value areas when the capabilities and
resources can be ranked higher is competitive superiority (Costa 2018). Manufacturing of the
software by Atlassian is its core competency.
Rare- Atlassian has employed a no sales force model and tow of the most important part
of the success of the organization is the promotion strategies and distribution model. They have
made the most of the two of the components of marketing ix that is promotion and distribution.
Connected model is another example of scare capabilities of organization and breaking down of
staff barriers using technology. Platform of collaboration for employees is served by confluence
and internal communication channel. Employee’s value are reinforced and creating time for
people to step outside their everyday mindset is done by the quarterly innovation event known as
ShipIt. In addition to this, the consumer style approach to sales of Atlassian implies that there is
online availability of the product, which is free to trial. They deeply understand what it requires
to be a sales organization that are driven by customers and their experience is flawless is every
stage of their purchasing decision.

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Inimitable- A firm can achieve sustainable competitive advantage if it has rare and
valuable resources that is costly to imitate. It can be seen that the capabilities of Atlassian is
based on the interpersonal relationship and its culture as the company differs from other
companies as it is driven by an inspiring set of values. The collaboration platform of the
organization is served by confluence and internal communication channel. However, a major
challenge faced by the Atlassian while it continues to grow is the innovation at scale and it
requires continuing to innovate to sustain in the competitive industry (Zhao et al. 2017).
Organized- If the organization is not able to capture the value from them, then they are
not able to confer any advantage. There is regular changes in the value of resources, which
should be reviewed constantly. The potential of the valuable area of the business can be realized
with the help of organized system of management, process, culture and structures. Atlassian
financial resources are well organized for capturing the valuable resources and are strategically
invested in the right places and thereby combatting threats and making use of opportunities.
Therefore, resources are the source of the sustained competitive advantage for the organization.
Moreover, the distribution network of the organization is organized in a manner that ensures the
availability of the products by reaching out to the customers (Underwood 2017).
Competitor analysis of Atlassian:
The key success factors in the software industry are flexibility, product capabilities, ease
of use, and total cost of ownership, customer satisfaction, global reach and scalability
integration. The competitors of Atlassian is broken down into three groups comprising of
technical and software teams, IT and service teams and business teams. Some of the competitors
within these groups include IBM, Microsoft, Google, Hewlett Packard Enterprise, Dendesk and

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Salesforce.com. Larger companies are looking for new business models so that they become
more responsive and flexible to the changes and the market (Dennehy and Conboy 2017).
Majority of the enterprise are actively engaged in creating one-stop shop software solutions by
actively engaging in the solutions. Moreover, a change in the competitive dynamic of the
software industry can be brought by the niche companies that is acquired by any of the tech
giants for creating competitive offering. Big technological giants are splitting into nimble
structures so that they are able to compete with the aggressive new players and startups.
Separation by way of distinct strategies, innovation and targeted investment would be able to
provide better growth in revenue (Aguinis et al. 2017). It is critical to find new streams of
revenue and improved margins for gaining success in the competitive environment.
Strategy analysis of Atlassian:
Atlassian is able to achieve competitive advantage by creating unique value for the
customers based on the culture and the distribution model of product strategy. The product
strategy of the organization is based on different elements such as easy to adopt, built for team,
adaptable and versatile with the strategy focusing on the satisfaction of customers. In addition to
this, the generic strategy of distribution is supported through distribution model, product strategy
and company culture. In order to gain increasing foothold in the market, it is required by
Atlassian to expand its development of market in emerging markets of tech startups and
knowledge workers. The way operations are carried out by Atlassian can be comprehensively
changed and the realignment of changes in the environment (Bergh et al. 2016). Furthermore,
organization can also opt for diversification of the product, which requires extensive research
and development.

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Conclusion:
The complete picture of the organization has been evaluated using different strategic
tools such as PESTEL, Porters Five forces and VRIO analysis of framework that has assisted in
identifying the game changing trend. It was identified from the VRIO analysis that the sustained
competitive advantage to Atlassian is provided by the distribution network and the financial
resources. The best platform for the organization to support their sales model, achieve mission
and sustain their rate of growth is to create expansion for the knowledge workers and market
development.

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References list:
Aguinis, H., Edwards, J.R. and Bradley, K.J., 2017. Improving our understanding of moderation
and mediation in strategic management research. Organizational Research Methods, 20(4),
pp.665-685.
Atlassian., 2019. Atlassian | Software Development and Collaboration Tools. [online] Available
at: https://www.atlassian.com/ [Accessed 14 Aug. 2019].
Bergh, D.D., Aguinis, H., Heavey, C., Ketchen, D.J., Boyd, B.K., Su, P., Lau, C.L. and Joo, H.,
2016. Using meta‐analytic structural equation modeling to advance strategic management
research: Guidelines and an empirical illustration via the strategic leadership‐performance
relationship. Strategic Management Journal, 37(3), pp.477-497.
Costa, M.C.D.C., Lemos, G.S. and Beck, F., 2018, May. Software engineering tools environment
for outsourcing teams collaboration. In 2018 IEEE/ACM 13th International Conference on
Global Software Engineering (ICGSE) (pp. 35-38). IEEE.
Crick, C. and Chew, E.K., 2017. Business processes in the agile organisation: a socio-technical
perspective. Software & Systems Modeling, 16(3), pp.631-648.
Dennehy, D. and Conboy, K., 2017. Going with the flow: An activity theory analysis of flow
techniques in software development. Journal of Systems and Software, 133, pp.160-173.
Ethiraj, S.K., Gambardella, A. and Helfat, C.E., 2016. Replication in strategic
management. Strategic Management Journal, 37(11), pp.2191-2192.