Vodafone Environment Analysis
1. Tangible Resources - Strong
(a) Financial Resources - Strong
Vodafone had been operating on a net profit year to year of several hundreds of millions of pounds, allowing for plenty of acquisitions and money to be spent on research anddevelopment. Vodafone had the expertise to reorganize these assets to earn above average returns. Each year, investors were willing to lend more credit or equity. By 2000, Vodafone was the largest telecom in Europe, twice the size of its nearest competitor, Deutsche Telekom. Activity ratios indicate that Vodafone is more efficient than its competition at collecting on its receivables and making its inventory work, adjusted for economies of …show more content…
Vodafone's management has the ability to acquire and merge with other companies while maintaining an effective, low cost, organizational structure. Through their research and development, Vodafone is able to maintain technological leadership in mobile telephony systems.
5. Core Competencies
Vodafone's capabilities in management and research and development should also be considered their core competencies because these abilities give them a source of competitive advantage over its rivals. Acquiring and merging with companies has allowed Vodafone togrow their customer base internationally. By investing in research and development, next generation platforms for mobile telephony for both voice and data allow Vodafone tomaintain a competitive advantage.
Does Vodafone have a sustainable competitive advantage?
Only using valuable, rare, costly-to-imitate, and non-substitutable capabilities create sustainable competitive advantage. Vodafone had valuable, rare, costly to imitate capabilities, but these capabilities were substitutable, thus, they had a temporary competitive