Dyson Case Study: Strategic Analysis and Recommendations

This case study analyzes Dyson's business strategies, competitive landscape, and internal capabilities. It examines the bargaining power of suppliers and buyers, threats of new entrants and substitutes, and industry rivalry using Porter's Five Forces. The analysis then applies the V.R.I.N framework to assess Dyson's strategic resources and competencies, followed by a SWOT analysis. The study evaluates the imitability of Dyson's capacities and the impact of James Dyson's role within the company. Finally, it provides recommendations, including going public and delegating R&D responsibilities to ensure continuity. The document highlights Dyson's strengths in innovation, patents, and engineering expertise, while also acknowledging weaknesses and potential threats, and suggests strategies for continued success in a competitive market.

DYSON CASE STUDY
Question One
Bargaining power of suppliers
The ability to have its own Research and Development team of engineers sets Dyson at an
advantage to have control over suppliers as they act as a leader setting pace for what they
need. The availability of 350 engineers and scientists in the R&D team means huge power.
The bargaining power of buyers
With so many options to choose from, the bargaining power of the buyers is high as there are
many different companies selling similar products. As such, Dyson has to make its products
tailored to suit the needs of its buyers, providing the best quality and at affordable prices.
Threats of new entrants into the market,
New entrants in the market is not a big threat to the company as the company is led by strong
Research and Development and thus for new entrants to be a threat they would have to have a
very strong Research and Development team. However, it is important for Dyson to have a
strategy for dealing with strong entrants.
Threat of substitutes
Substitutes exists in the market from different companies. As identified there are already five
competitors with the likes of Electrolux, Miele Hoover, and Excel Dryer. The main threat for
the company currently is Excel Dryer.
Industry rivalry
There already exists a competition rivalry in the industry with other giant companies
competing with Dyson and at similar scores. However, an increased use of technology and
R&D to come up with outstanding designs like already being implemented in the company
through unique design like bagless vacuum and bladeless fan.
Question Two
Using the Organization Resource Audit through the V.R.I.N framework; Dyson has strategic
capabilities as follows:

Value - Dyson’s aim is to improve the traditional products and solve issues of their
consumers through improvement of functionality and new design of the products and thus the
Dyson’s intensive R&D.
Rarity - The company has achieved the ability to provide the best product in the market
through their insistence on functions hence achieving value for their consumers through rare
products launched by the company ahead of competitors.
Inimitability- Dyson has ensured to have patent rights to protect their products at every stage
and though with so many competitors it is always possible to copy designs, the availability of
these rights by the company has seen it pay 5 million for patent infringement by Hoover.
Non-substitutability - Dyson big team of engineers and scientists work efficiently to ensure
they are the first in developing new products to avoid being substituted by other companies.
Further, the company has adopted a culture of secrecy to ensure that their next launch is
always a top secret.
Dyson’s SWOT:
Strengths
 A lot of patents under their name
 Strong team of engineers, scientist and R&D
 High influence in UK market with 1200 workforce
 Strong branding with local and global presence
 High profit margin with low investment in workforce through distributors and
network
Weaknesses
 High criticism for copying competitors
 Mark Dyson role is very important, and his departure could make the company in
challenge
Opportunities
 Launching new products and expand global market.
 Ecommerce presence would make more business
 Acquire small companies to increase market share overseas
Threats
 Cheaper products from competitor
 Economic fluctuation
 More competitors through online retailers

Organizational resources and competencies are available in terms of a team of 350 engineers
and scientists, product tests unit with 120 test benches, 1200 employees composed of both
qualified experts and young graduates.
Another capability Dyson have is outsourcing which it has adopted through taking its
production activities to Malaysia which has acted in their favour as their suppliers are
centralized in Asia and the cost of labour is lower hence leading to cost efficiency.
Question Three
Dyson’s capacities are imitable though only to a small extent. This is because the company
uses patented technology that makes it easy for the engineers to maneuver and improve the
products as they please and the ingredients for the success of the company is preserved
through top secrecy. The offices are safeguarded by biometric sensors and the company
discussions are protected through sound absorbers hence ensuring no information leak
outside. All these give strength to the opinion that imitability of Dyson capacities’ can only
happen at a very small extent.
Moreover, the high number of engineers and scientist working on the designs to ensure their
success would be the competitors would need an even higher number to imitate such
capacities. The testing benches of the products are also too many that it would discourage any
potential imitators. The company will also have its own students in Dyson Design
Engineering which will give high originality of design.
Question Four
James Dyson is a key public figure in the company acting as not only the chief innovator but
also the advertising brand. His presence in the company commands customers’ confidence
and trust. Appearing on most of the advertisements keep the sales growing, his departure
would thus mean a drop in sales. His presence also keeps the engineers at check knowing that
he is also an engineer and will take nothing but the best, his departure would therefore mean
the engineers would likely relax on their jobs.
Having built the company solely, means he’s the biggest shareholder, sale of the company
hence means getting his shares back and this would affect the financial position of the
company.
Recommendations
To ensure that the company continues in existence, it is recommended that the company goes
public to rid sole proprietorship by James Dyson. Research and development engineering
should also be delegated to another person while James Dyson observes from a distance so as