Viacom Inc Harvard Case Solution & Analysis

Viacom Inc Case Study Help

VRIO Analysis

A company reinforced the core value of company including innovation, creativity, and advanced technology having the ability to deliver the sustainable competitive advantage to the firm. The strategic acquisition of MTV Network, Blockbuster and Paramount and an expansion into new markets provides sustainable global competitive advantage.Viacom developed the sustainable competitive edge in the highly competitive marketarena by offering the exclusive and quality content to its customers, incorporating the technology, & maintaining the operations of the business through integrated Organizational Support.Theexclusivity and diverse portfolio and the largest audience share makes Viacom to successfully maintain its competitiveedge in the market, hence leading to maintenance of the market share and sustained profits inlong run.

Value Chain

The business plan that would distinguishes Viacom from competitors is the strong brand image and unique value proposition which should be developed “the top of mind state” in the mind of consumers. Primarily, it is because of the continuous value addition and uniformity in the value chain and services that keeps the customer intact, involved and engaged with brand. As Viacom incorporated technology as it core fundamental, it keeps developing smart recommendation service that would keep the customer interacted and engaged with the brand as well as develops the loyalty loop that would ensure and guarantees the retention and sustainability of the customer base.

Corporate Strategy

Vertical or horizontal

A vertically integrated company – Viacom owns firms that tends to produce contents& other firms that distribution entertainment. For example; Paramount owns the MTV film that has been engaged in producing movies and owns TV channels that could air their films.

Viacom is also a horizontal integrated company because it owns hundreds of channels in TV industry through number of companies. Also, the company increases its profit returns through a series of the strategic acquisition and expansion in new markets.

Diversification

Viacom is less diversified organization than its competitors as the company does not own sizable movie business and broadcasting network that could compete with the likes of Fox, Warner and Disney (Forbes, 2016).

Business Strategy

Cost Leadership

The company has created the competitive advantage by keeping the cost low through boosting the output of movies at Paramount while keeping the budget under control and find ways to make low-budget successful movies. The company aims to build cash flows and increase revenues by reducing operating cost and leverage competencies and resources across divisions.

Differentiation

The growth strategy of company enable it to realize the full potential of its premier international portfolio of entertainment brands which provides competitive differentiation and increased adaptability of the business as a whole.

Cost Focus

Viacom attempts to develop the new potential sources of the revenues while keeping the cost low to expand the revenues. The competitive differentiation is maintained by company while keeping the cost low to gain better profits in the highly competitive market arena.

Differentiation Focus

Viacom consist not only of the branded products but differentiated ones as well. It is to say that uncontested market space is created by Viacom, make fierce and intense competition in the industry irrelevant, create and capture new markets, &aligned activities in pursuit of low cost, focusanddifferentiation.

Backward/Forward Integration

Throughout the early 1980s, the company has followed the strategy of aggressive forward vertical integration into acquiring several radio and TV stations, distributionand assembling the group of cable television system. The company intensified the pace of its vertical integration strategy as it announced the Paramount Pictures acquisition that is turn allowed the company to become one of the leading international provider of branded entertainment content.

Full Integration/ Taper Integration/ Quasi Integration

Dauman have successfully formed various strategic alliances with core consideration of increasing the value of asset of Viacom including several joint ventures with the Indian based and US based companies to expand the business operations and presence in the country as a part of its quasi integration strategy.

What do you think of their strategy?

The growth strategy of thecompany revolved around creating the new business model on the basis of the creative excellence and focus on the strategic moves, internet internal ventures and acquisitions and TV channel. The cable network of the company including Nickelodeon and MTV among other are of key significance and account for 90 percent of the value of company. Though the current strategy of the company is effective but with growing consumption of videos on handheld devices and digital media, the future strategy of Viacom should focus on digital content to drive future sales (Forbes, What Matters Most For Viacom?, 2015).

Recommendation of new strategy

On account of the faced paced and changing competitive media landscape, the company is recommended to own broadcasting network or the sizable movie business that would allow the company to compete with Disney, Fox and Warner. It is expected that the revenues of company would see continued pressure from the rapid growth of alternative video platform which in turn lead to lower penetration level for cable network of Viacom in near future. As maximum people would tend to embrace the streaming options, there would be the significant decline in pay-TV subscribers which would negatively impact the subscriber base of cable network. However, the company could offset that decline through pricing growth and continued subscription in international market. To grasp the maximum potential subscribers, the company should launch ad-free, ad-supported and premium version of the service. Additionally, the company should announce film production deal with Netflix or Hulu and take on multichannel strategy to serve the widest accessible market(Clifford, 2019).......................................

 

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