Air New Zealand Limited is a flag carrier airline of New Zealand. The company is based in Auckland. It operates the scheduled passenger flights of 32 international destinations and 20 domestic destination in 20 countries. The destinations are mainly around Pacific Rim. Air New Zealand is the member of Star Alliance since 1999 (Air New Zealand, 2020).
The VRIO model is an analytical tool used by the companies for categorizing the resources on the basis of whether, they are effective for the company for mitigating threats or availing the opportunities. This classification helps the companies in identifying the resources and capabilities which can achieve competitive advantages. There are four components of the analysis: Value, Rarity, Imitability, and Organization. Here is the detailed VRIO analysis of Air New Zealand.
Value
When the resources are valuable, it helps the company in achieving some benefits. Yet it alone can help the company with competitive parity. It is necessary for the company to identify the valuable resources so that it could exploit in best possible way to avail more opportunities. Air New Zealand is national flag carrier of New Zealand.
The company has achieved a tangible resource of being national carrier and its relationship with government. This bring the long-term competitive advantage to the company. Moreover, buildings and technology and other physical assets like airline equipment are also very valuable. Air New Zealand can use their equipment very well in the expansion strategy (Dw, 2020).
Rarity
The resources and capabilities which are uncommon and not easily available are rare. When the resources and capabilities are rare and valuable, company can achieve competitive advantage. But this will be for short term. Rivalry companies can identify it and will try to imitate it. Air New Zealand enjoys the perk of being a national carrier and good relationship with the government, as no other airline in New Zealand can have this.
The airline company can use this resource for avoiding all the threats it is facing. However, its technology and equipment are not rare. Other airline companies also have these which makes it less important for the company. As being associated with the country at national level, its brand identification is also rare which its competitors does not have (UK essay, 2018).
Imitability
When resources are difficult to imitate, it is beneficial for the company. The more expensive and difficult to imitate the resource will be, the more beneficial it will be for the company. Many companies protect their resources from copying down through patent, copyrights etc. Air New Zealand has built a strong image as a national flag carrier in the country which is rare and no other company in the same sector can achieve it.
Moreover, company hire highly skilled employees who are not difficult to imitate resource but costly. The relationship it maintained and build with its suppliers and customers are also difficult to imitate (UK essays, 2018).
Organization
It is necessary for the company to organize its resources for capturing the value, rarity, and difficult to imitate. If any company is successful in achieving all previous components along with this one, the company will be able to enjoy the competitive advantage for long run. Air New Zealand organized its business operations very well.
The company hired skillful employees and it is necessary for the company to motivate them well. The company also have organized working culture along with well explained hierarchy (DW, 2020).
Conclusion
Air New Zealand is a national flag carrier airline company of New Zealand. The company is exclusively enjoying the perks of being close to government and achieved competitive advantages for long term.
| V | R | I | O | ||
| Supply Chain | ✓ | ✓ | ✓ | Competitive Parity | |
| Bargaining power | ✓ | ✓ | ✓ | Competitive Parity | |
| Inventory management | ✓ | ✓ | ✓ | ✓ | Sustainable advantage |
| Brand Equity | ✓ | ✓ | ✓ | ✓ | Sustainable competitive advantage |
| Marketing | ✓ | ✓ | ✓ | ✓ | Sustainable advantage |
| Product quality | ✓ | ✓ | ✓ | ✓ | Sustainable advantage |
| Service range | ✓ | ✓ | Sustainable advantage | ||
| Talented HR | ✓ | ✓ | ✓ | Competitive parity |
References
- Air New Zealand, 2020. About us. [Online], Available at: https://www.airnewzealand.com/about-air-new-zealand, [Accessed on: 23rd March, 2020].
- Dw, N. 2020. Why Air NZ’s Marketing Strategy Soars Above Competitors!. [Online], Available at: https://www.impressive.com.au/marketing/why-air-nzs-marketing-strategy-soars-above-competitors/, [Accessed on: 23rd March, 2020].
- UK Essay, 2018. The Air New Zealand Business Essay. [Online], https://www.ukessays.com/essays/business/the-air-new-zealand-business-essay.php?vref=, [Accessed on: 23rd March, 2020].