Introduction
In "Inside Dyson: a distinctive company?" , Shepherd et al. (2011) detail the secret of Dyson's success, the company specializing in innovative, design-heavy vacuum cleaners and other household appliances. The successes and failures of Dyson's design efforts (from their successful vacuums to the 3 in 1 vacuums that did not test well with customers) are detailed, as well as their unique perspective on business, which puts quality and innovation over all else.
1 Using frameworks from the chapter, analyse the strategic capabilities of Dyson.
The strategic capabilities of Dyson revolve primarily around the a resource-based view of strategy, with a heavy focus on engineering design; they spend a tremendous amount of time developing and engineering prototypes for household products that provide some new trick or twist to the typical device (e.g. vacuum cleaners that provide smooth turning around corners, oscillating fans that "multiply" air). This creates a niche in what can be an overly-saturated market; providing a unique spin on a product can offer tremendous advantages. Combine this with state-of-the-art, sleek design elements and bright, colorful exteriors, and Dyson creates a number of high-end, well-sought after appliances. Dyson invests heavily in Chinese and Asian manufacturing in order to make their products more cheaply, so they can maintain profit margins. This emphasis on design in their organizational planning means not as many products go out, but what they do sell they can sell to a specialized market for higher prices.
Given the innovation that is present in Dyson's business strategy, it is quite clear that their strategic capability is high, though their risks can be high as well, due to the experimental and 'out there' nature of their products, which may be too daunting for normal consumers.
2 To what extent do you think any of the capabilities can be imitated by competitors?
The primary niche that Dyson follows is superior design; as a result, it can be quite difficult to replicate those specific strategic capabilities. Their focus on innovation revolves around them being the only ones around to actually try to change the way the vacuum or other appliance is designed in a fundamental way; that level of specialization is what attracts customers to them. In order to provide legitimate competition for Dyson, superior engineering designers would have to be hired, and a much greater focus on innovation would have to be attempted. Otherwise, Dyson's dominance of the high-end, experimental housewares market remains unchecked by competitors. Competitors are already trying to imitate these products, with the USA Wind Tunnel vacuums and Mjele swivel-head vacuums; however, the patents Dyson has placed on their product prevents other companies from outright stealing their ideas.
3 Which of Dyson's distinctive capabilities may, over time, become threshold capabilities?
The existence of high value specialties will likely become a threshold capability more and more as time goes on for Dyson. Threshold capabilities are what is required to remain in the market as it exists; currently, what is allowing Dyson to maintain its high prices is the high quality of the design and engineering present in their products. Compared to other consumer-level appliances of their kind, Dyson stands out as a product and from a marketing standpoint. Emphasizing the new and innovative allows the consumer to feel as though they are receiving a brand new, insightful product, leagues ahead of the competition. For Dyson to change its business model in any way towards increasing volumes of standard products would be to tarnish its image, nearly irreparably. What is maintaining Dyson's primary conceit is the innovation of design, which is a clear threshold capability.
4 Bearing in mind your answers to questions 1 and 2, how crucial is Sir James Dyson to the future of the company? What might be the effect of his completely leaving or selling the company?
Given the unique branding importance of James Dyson, it would certainly be a blow if he were to leave or sell the company. James Dyson is placed prominently as a public figure and a spokesperson on their commercials. For many consumers, there is a certain security in seeing the actual representative or president of the company speak to them directly and explain the features of the Dyson vacuum; if that were to be come, it is possible that consumer trust would be somewhat compromised. Though he is no longer the CEO, Dyson continues to be featured in their advertisements; many see him as the face behind the typ e of design innovation that Dyson is famous for. If he were to leave, it is possible that the company would survive, but it would experience a dramatic decrease in sales, and would require an equally innovative marketing campaign to fill the void left by Dyson - a campaign that would require the same level of experimentation and change that is representative of the company (Howells, p. 118).
Conclusion
In conclusion, the Dyson company's primary business strategy is to provide tremendously innovative and sleekly designed high-end products to the housewares market, all of which have fundamental improvements or changes in the way they are designed as compared to normal appliances. Much of their strategic capabilities lie in the ability of the engineers at Dyson to continue to develop new products ahead of their time, as well as the charismatic presence of James Dyson as a spokesperson for their marketing campaign. Dyson's modus operandi is to make better vacuums, charge people more for them, and not manufacture as many as their competitors. This increases demand and interest, while also allowing for acceptable higher prices on their products.
References
Capasso A, Dagnino GB, Lanza A, 2005, Strategic capabilities and knowledge transfer within and between organizations: new perspectives from acquired networks, learning and evolution. Edward Elgar Publishing.
Haberberg A, Rieple A, 2008, Strategic management: theory and application, Oxford University
Press, p. 309.
Howells J, 2005, The management of innovation and technology: the shaping of technology and institutions of the market economy. SAGE, p. 118.
Shepherd J, 2011, 'Inside Dyson': a distinctive company?, in Exploring Strategy, ed. Johnson G, Whittington R, Scholes K, Pearson Education, p. 5-7.
