Strategic Management Report: Atlassian Corporation Analysis

This report provides a comprehensive strategic analysis of Atlassian Corporation plc, an Australian software company. It begins with an executive summary, followed by an introduction outlining the report's purpose, which is to assess the company's position, industry attractiveness, and provide recommendations for improvement and global expansion. The analysis includes a PESTEL analysis of the macro-environment, examining political, economic, social, technological, environmental, and legal factors affecting Atlassian. An industry analysis using Porter's five forces model evaluates the attractiveness of the software industry, followed by a company analysis focusing on resources, capabilities, core competencies, and competitive advantages, including a VRIO framework assessment. The report also includes a competitor analysis and discusses Atlassian's business-level strategies, such as cost leadership and differentiation, recommending new strategies for sales expansion. The report concludes with recommendations for future growth, including forecasting and product-market matrix strategies.

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Atlassian Corporation plc.

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Executive Summary
Atlassain is a software company of Australia, the purpose of the report is to know the condition
of the software industry. In this report the PESTEL analysis and porter’s forces analysis shows
that most of factors considered positively to the company like technological, economic, political
as well as the power of the buyer and suppliers is high. The analysis of the company is also done
and VRIO framework is created, further the analysis of the competitor show that there is high
competition in the industry. The business level strategy includes cost leadership and
Differentiation Company used is discussed and new is recommended to enlarge the sales. The
recommendations are also provided like, forecasting, product- market matrix to expand the
business.

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Table of Contents
Introduction......................................................................................................................................3
Analysis of Macro environment......................................................................................................3
PESTEL Analysis........................................................................................................................3
Political factor..........................................................................................................................3
Economic factor.......................................................................................................................3
Social factor..............................................................................................................................3
Technological factor.................................................................................................................4
Environmental factor................................................................................................................4
Legal factor...............................................................................................................................4
Industry analysis..............................................................................................................................4
Life cycle stage............................................................................................................................4
Porter’s five forces analysis.........................................................................................................4
Company analysis............................................................................................................................5
Resources and capabilities...........................................................................................................5
Core competencies.......................................................................................................................5
Competitive advantage.................................................................................................................5
VIRO framework......................................................................................................................5
Competitor Analysis........................................................................................................................6
Strategic Analysis............................................................................................................................6
Business level strategies...............................................................................................................6
Cost leadership strategy............................................................................................................6
Differentiation..........................................................................................................................6
New strategy................................................................................................................................6
Focused strategy of low cost....................................................................................................6
Focused on distinctive to niche market....................................................................................7
Recommendations............................................................................................................................7
Conclusion.......................................................................................................................................7
References........................................................................................................................................8
Appendix..........................................................................................................................................9

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Introduction
Atlassian Corporation plc is an Australian company that develops the products for the software
developers and the project managers and for the content management. The company is in the
software industry and provides services to more than 135,000 consumers. In the year 2018
revenue earned by the company is $874 .0 million as well as at present 3061 employees are
working in the company (Anon., 2018). The purpose of the report is to find out the factors
affecting the company, analysis of competition in the industry, core competencies of Atlassian as
well as to provide recommendations to the company. These aspects is discussed in the report
through PESTEL analysis, the analysis of industry is done through Porter’s five forces model,
further VRIO framework is also discussed in the report, to know the core competencies of the
company. The recommendations are provided through analyzing the threats of the competition.
In this report business level, strategy used by the company is also identified and suggestions are
provided to makes improvement in current strategy. The Key outcome of the report is to know
the company position, industry attractiveness to provide recommendations for further
improvement and expands globally.
Analysis of Macro environment
PESTEL Analysis
Political factor
In the year 2016, due to Brexit as well as the election held in the United States changes the
President of the country that is Donald Trump. These changes in the events of political
strengthen the dollar of U.S whereas weaken the currencies of the foreign. This contains the
positive alteration for Atlassian, because it only agrees to take payment through the dollar of
U.S., but incurred expenses in the country of Europe (Burdon & Dovey, 2015).
Economic factor
The increase in the interest rate to 6.35% in the year 2015, leads higher investments, which
influenced positively to the Atlassian Corporation Plc and raise the revenue up to $320 million
(Zaheer et al., 2018).A greater unemployment, which is 5% in the year 2018, decease the cost of
the company because person also works in the lower wages.
Social factor
The inequalities is rising in Australia , in the year 2016 the population of lower class is about
13.3%, influenced by Atlassian corporation Plc. to not promote a first-class manufactured goods
to the public. In 2018, the population of the country is 24,772,247 and the median age is 37.5,
which affects the Atlassian to develop the product and choose marketing strategies accordingly
(Beck et al., 2017).

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Technological factor
The alteration in the segment of the technology includes cloud computing and X-as-a-model of
Service business. To sustain in the competitive environment all the software companies adopt
this, this affects Atlassian is positively because the major targets for products is the development
of the software teams. This increases the Quarterly revenue of the company up to $243.8 million
in the year 2018 (Anza, 2019).
Environmental factor
The Environmental factor also affects the company, in Australia software industry has to run
their operations on 100% energy of renewable (Soane et al., 2016). The rule is also made for the
industry to make the environment “Green” by using two element of the company that is human
resource as well as the electricity.
Legal factor
The alteration in the segment of legal affects the Atlassian negatively due to the law of cyber
security this makes the company difficult in developing the product and transporting it due to the
higher standards of security. In the year 2018, no goods will be exempted from the tax in the
Australia. This increases the expenses of the company (George et al., 2019).
Industry analysis
Life cycle stage
The software industry, in the Australia is in the growth stage of the life cycle. In which the sales
is increasing at faster rate, but various challenges lie further due to increase in the competition
among the companies like Slack, Jive software. The revenue is increases by the software
industry, which is 11.8% in the year 2018; the industry spends 3.5% in the year 2018, in making
the products innovative, the industry growth increases up to 10.4% in the year 2019 (Fitzgerald
& Stol, 2015). The various trends followed by the industry, which includes cloud, Edge as well
as the 5G from the infrastructure of the modern economic, technologies of the Stackable and
model of distribution.
Porter’s five forces analysis
The Porter’s forces analysis shows that the software industry is somewhat attractive because the
new entry threats is medium as the company can come in the industry of software through
extremely lower investment which is initially made, but it is hard to make a product, which gain
success. The purchaser power is high; now due to the new form and model of monthly
subscription software of the cloud deployed has decreases the switching cost as well as
reciprocally increases the purchaser power (Gruning et al., 2019). The supplier power is also
high, it is due to that the major elements of the software industries is the supplier and the
personnel, so in the software industry competition to acquire extremely experienced employees
to high. Therefore, both have large power in negotiate the cost, compensation as well as for the
other benefits. The threats relating to the substitutes, is medium for the industry of software. The
software industry is in the growth stage, but estimation shows that it will be in the maturity sage

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due to numerous alternative ventures of software companies available in the industry like Xero,
Canva. The competition is higher in the industry of software because it is in the stage of growth
and due to various trends in the technology like cloud, Edge adopting the various companies like
Xero, OFX to make product innovative (Wang, 2019).
Company analysis
Resources and capabilities
The durable rate of the resources is medium or low of Atlassain. The core capabilities of
Atlassian are extremely inflexible to copy, which includes, that company target the requirements
of team members, who develop the software. The other capability is cloud deployment, the
distinctive features of the product are difficult to duplicate like software of Jira it has feature of
advanced safety and management, searching powerfulness, other is Confluence that distribute the
knowledge and information efficiently. The company also has efficient as well as competent
employees (Lee et al., 2016).
Core competencies
Atlassian’s core competency is developing the superior software. It lies in the capability to create
devices, which are adaptable, reasonable priced as well as easily adopted which is most effective
in achieving the objectives to make the innovative product. The product of the company is also
core competency of the company like JIRA software, service desk of JIRA, Confluence.
Competitive advantage
The distinctive value makes the Atlassain to take the competitive advantage. Some values of the
company are participating as a group; make the transformation, which, you seek out (MANOLE
& AVRAMESCU, 2017). The company use channel of low-friction, which is mouth publicity
for expanding the products, the training courses like project administration in Jira server, through
which make the employees efficient.
VIRO framework
Human resource
Valuable
The Human resource of Atlassian is extremely valuable because various training programs
provided by the company like individual training as well as team training courses like Jira
service essential, through which the skills of the employees increases and employees can be
work in all the areas due to the rotational structure.
Rare
The employees of the company are rare because different courses offered to the employees like
Jira service essential, project administration in Jira server according to the needs and
requirements of the employees, which results in developing the efficient product like distinctive
features of Jira software includes distribution of knowledge efficiently, powerfulness in
searching (BRAD et al., 2016).
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Imitable
The company can also take the competitive advantage, it is because of the training as well as
rotational structure; employees can works in all the areas and due to effective intellectual skills
of the employees.
Organization
The company organized the employees through the system of Enterprise resource planning,
which help Atlassain to collect and process the millions of employee’s record in particular
period.
Competitor Analysis
From the analysis of porters five force model, we find that the competition is high in the industry
of software. Atlassian splits the competitors into three divisions it is based on the receiver that is
teams of IT as well as service, teams of technical as well as software and further the team of
business. Due to this company, offer various products, and competition increases. The
enlargement in the competition is due to three divisions. The various competitors include
GitHub, and the various enterprises currently working in software industry. The main
competitors of the company CA technologies, Slack, Jive software, these companies considered
the main competitive threat for the Atlassain due to offering same software products with the
better quality. Slack is the tool of software, which offers features like IRC (internet relay Chat),
The Jive software is as similar as the product develop by Atlassian, which is Confluence, both
offers similar features like Integration of Email as well as integration of external (BAJIGHAR &
SHAHZAD, 2017).
Strategic Analysis
Business level strategies
Cost leadership strategy
It is considered the strategy in which firm keep the price of the product low or maintains the
normal price to take the competitive advantage. Atlassian while entering in the market of foreign
uses this strategy, to stay away from Competition, Company sells the products at lower prices
like for the Jira software, and the price will be $7 for the first hundred users monthly in the year
2019. The product of Atlassain is reasonable to even small organization. The company sells most
of the products at lower cost like in 2019 the price of confluence is $5 for the 11-100 users
monthly, it sell internationally and also encourage the consumers to purchase all the way through
the without charge trail (Hosmani et al., 2019).
Differentiation
The Companies, which use the strategy of differentiation succeed and gain the higher market
share by providing the unique and distinctive features of the product, according to customer’s
value. Atlassian adopt this strategy by providing various distinctive features in the products like
in software of Jira in the year 2019, the company offer features of reporting in advanced,
powerfulness in the filtering and searching, importing data easily (BAJIGHAR & SHAHZAD,
2017).

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The current strategy is working because in the year 2019, the quarterly revenue generated by the
company is $334.6, which is 36% higher from the year 2018. In 2019, Atlassian served over
1,50,000 customers and considered the company of cloud-first (Eckhardt et al., 2019).
New strategy
Focused strategy of low cost
Atlassian can adopt the business level strategy, which is focus strategy of low cost. The company
is providing the products at the lower cost, this strategy refers that the company should keep the
cost lower in comparable with the prices of the competitors but at the same time it should also
focus on the efforts of marketing to attract the target customers (Fleisher & Bensoussan, 2015).
However, the company is not so strong in the part of marketing (Hoogveld & Koster, 2016). This
strategy can help the company to increase the prices or keep the higher prices for some high
quality products and generate more profits because due to lower prices, company sales are
increasing. Through adopting this company can also be successful in higher prices.
Focused on distinctive to niche market
In this strategy, company adds the worth in the goods and after that target the market of Niche
(Chen et al., 2016). Atlassian can adopt this strategy, however the company adds new features in
various products but now company can target the niche market to take the competitive
advantage, due to high competition in the software industry.
Recommendations
The company can expand globally in the future, the company can make the efficient choice to
develop and make expansion throughout the development of the market, through approaching
into country with the forecasting, which contain rising market of the capable employees and need
startups of tech. This suggestion also achieves the goal of the company, which company stated
that company needs all the capable employees in all the groups, in the each corporation use the
product of Atlassian regularly. The company can also use the matrix of product-market
expansion, which help the company, to take the competitive advantage and expansion in the
market of new with the lower threat. Atlassian can also use the strategy of original and
innovative video of content, in this company can use the unique story to tell about the products,
because nowadays majority of the people, watch the video online instead of watching the
datasheet of the company products. It helps the company to reach many consumers and attract
them through informing about the unique features about the products.
Conclusion
From the above, it concludes that Atlassian is a software company, the majority of the macro
environment reacts positively to the company in making the efficient products through new
technology like cloud computing, increases the employees in the company. Through the analysis,
it found that the industry of software is in the growth stage due to enhancement in the revenue as
well as the competition is high in the industry, medium rate in the threats of new- entrance and
substitutes, high power of supplier and buyer. The analysis of the company that company has
valuable resource, offer unique products, rare availability of alternative, effective usage of
resources. The company is also in the threats of the competitors; main competitors are Slack,
Jive software, CA technologies. Further, the company is using the cost leadership and

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differentiation strategy to increase sales. The various arguments conclude from the analysis that
the efforts made by the company in marketing of the product is not very strong, for this company
can use the video content marketing strategy. Other argument can be high level of competition
for this company can use the strategy of Differentiation to the niche market to gain the
competitive advantage.
References
Anon., 2018. Atlassian Annula report. [Online] Available at:
https://s2.q4cdn.com/141359120/files/doc_financials/2018/TEAM-FY2018_Annual_Report.pdf
[Accessed 28 July 2019].
Anza, F.A., 2019. Key Factors in Implementing Knowledge Management System based on
Project Management. Jurnal Administrasi Bisnis Terapan, 1(2).
BAJIGHAR, M. & SHAHZAD, F., 2017. Autonomous Software Development: Sustain Market
Share in Constantly Changing Software Product Industries. In WMSCI 2017-21st World Multi-
Conference on Systemics, Cybernetics and Informatics, Proceedings, 1.
Beck, A. et al., 2017. A Multilevel Analysis of Individual, Health System, and Neighborhood
Factors Associated with Depression within a Large Metropolitan Area. Journal of Urban Health,
94(6).
BRAD, M.C., BIRLOI, F.C., BRATULESCU, A. & BLAGA, I.B., 2016. A Comparative Study
of Agile Project Management Software Tools. Economy Informatics, 16(1).
Burdon, S. & Dovey, K., 2015. Exploring the cultural basis of innovation. Journal of Innovation
Management JIM, 3(3).
Chen, K.-H., Wang, C.-H., Huang, S.-Z. & Shen, G.C., 2016. Service innovation and new
product performance: The influence of market-linking capabilities and market turbulence.
International Journal of Production Economics, 172.
Eckhardt, A., Endter, F., Giordano, A. & Somers, P., 2019. Three Stages to a Virtual Workforce.
MIS Quarterly Executive, 18(1).
Fitzgerald, B. & Stol, K.J., 2015. Continuous software engineering: A roadmap and agenda. The
Journal of Systems and Software .

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Fleisher, C.S. & Bensoussan, B.E., 2015. Business and Competitive Analysis: Effective
Application of New and Classic Methods. Upper Saddle River: FT Press.
George, B., Fritz, J., Schanz, D. & Sixt, M., 2019. Corporate income tax challenges arising from
digitalised business models. SSRN .
Gruning, B.A., Lampa, S., Vaudel, M. & Blankenberg, D., 2019. Software engineering for
scientific big data analysis. GigaScience, 8(5).
Hoogveld, M. & Koster, J., 2016. Measuring the agility of omnichannel operations: an agile
marketing maturity model. International Journal of Economics & Management Studies , 3(6).
Hosmani, P.S. et al., 2019. A quick guide for student-driven community genome annotation.
PLoS computational biology, 15(4).
Lee, J.J. et al., 2016. WIRELESS NETWORK CLOUD COMPUTING RESOURCE
MANAGEMENT. U.S. Patent 9,467,507.
MANOLE, M. & AVRAMESCU, M.Ș., 2017. A Comparative Analysis of Agile Project
Management Tools. Economy Informatics, 17(1).
Soane, E. et al., 2016. Confluence and Contours: Reflexive Management of Environmental Risk.
Risk Anlaysis, 36(6).
Wang, Q., 2019. How to apply AI technology in Project Management. PM World Journal, 8(3).
Zaheer, H., Breyer, Y., Dumay, J. & Enjeti, M., 2018. Straight from the horse's mouth: Founders'
perspectives on achieving ‘traction’ in digital start-ups. Computers in Human Behavior.

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Appendix
Porter’s five forces analysis of software industry
SOURCE: (Gruning et al., 2019)
Core values of Atlassian
SOURCE: (MANOLE & AVRAMESCU, 2017)
Atlassian business level strategies
SOURCE: (BAJIGHAR & SHAHZAD, 2017)