In this discussion forum we will look at how the VRIO framework and company diam
ID: 430659 • Letter: I
Question
In this discussion forum we will look at how the VRIO framework and company diamond can be used to assess corporate strategy. This same process can be used for your company analysis so keep good notes on what you did and where you were able to locate information. For the purposes of this forum we will all look at the same company: ESPN.
Instructions:
1. Identify the resources and capabilities of ESPN. Use your own knowledge and experience with ESPN along with the company website to complete the VRIO Framework. Post 3 different resources and/or capabilities that you see and indicate whether each has Value, Rarity, Inimitability and if it is Organized to exploit.
2. Next, use the company diamond to answer the following questions:
What are some of the things they do to compete (Activities)?
What are some of the assets they employ (Resources)?
What are some of the processes they use (Capabilities)?
What are some of the values that guide them (Priorities)?
Please list at least 2 items for each of the questions above.
Explanation / Answer
VRIO stands for Value, Rarity, Imitability and Organization
VRIO framework for ESPN
Value
ESPN is valued at $14.6 billion as of May 2018 as per Forbes. Its revenue stands at $11.4 billion. ESPN is a valuable company because it is a name synonymous with broadcasting of any sporting activity. They have a strong presence globally either directly or through other broadcasters in the form of revenue sharing models.
Rarity
ESPN till about the early 2000s had a high quotient in the parameter of Rarity. However with the shift from cable to digital, this advantage has been lost by ESPN. Entities like Barstool Sports and even Netflix is eating into shares of ESPN by simply delivering similar content, but in a more snazzier format.
Imitability
The concept of delivering content in a scale that ESPN operates in, cannot be easily imitated. However, to live in this illusion that they are invincible would be foolish. They will remain relevant only if they can successfully shift from cable mode to digital mode.
Organization
ESPN from its early days has now shifted to almost an opinion based sports channel. Jemele Hill was fired for calling President Trump a white supremacist. ESPN played out a very exhaustive broadcast at the time national anthem protests had started. So all of this points towards a shift from a hardcore sports channel to somewhat of an opinionated sports channel.
What are some of the things they do to compete (Activities)?
ESPN has begun to place a more young and diverse multimedia talent. Names such as Bomani Jones, Pablo Torre, and Mina Kimes have been put into larger, more forward-facing roles
ESPN has launched The Undefeated, an African-American-focused sports and culture website
What are some of the assets they employ (Resources)?
Disney, its parent company announced that it is planning to start 2 streaming services (with Netflix as its target competition). One of these will offer movies and the second one will offer ESPNs second tier sports.
ESPN is adapting SportsCenter for Snapchat
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