Strategy LR VIRO Framework Assignment
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NETSCOUT provides application and network performance management to the enterprises’ community, telecommunication service providers and government agencies.The given literature review will discuss the current performance of NetScout and the external factors that can be impactful on the strategies of the business. The identification of external factors will be done using the Pestle analysing tool that helps an organisation to identify the external impactful factor for the operation of a business. To recognise the resources and capabilities of NetScout, the literature will use the VRIO framework that assists an organisation to determine its competitive potential. The final discussion will drawout and identify some strategies to maintain the sustainable growth of NetScout.
2. Impact of External Factors on NETSCOUT’s Current Strategy
NetScout is famous for multi-purposes like real-time visibility, troubleshooting and protection regardless of wherever the business application and technological infrastructure exist. As per the view of Iorga (N.D.), the company is headquartered in Westford, Massachusetts and founded by Anil K Singhal in the year 1984.Rothman(2020)stated, in 2020, the total revenue of NetScout was $831 million and the net income of the company was $33.29 million. The company helps various businesses to accelerate digital transformation and provides the required scope, scale and consistency to provide protection to the digital infrastructure.
Political influence leaves significant pressure on the long term. As per the statement of Mason (2007), it is considerably very crucial for the survival and profitability of an organisation. The political factors have become a sensitive issue for NetScout as the company operates in many countries. Due to its presence in different countries, political tensions are creating instability in the global political environment that is affecting the growth of telecommunication and application services and is limiting the available opportunities of Netscout.
Whittington et al., (2017) reviewed,macro environment directly influences the currency interest rate, exchange rate and economic growth of a country.Therefore, economic factors directly affect the performance of any organisation. On one hand, where a growing economy offers a wide range of opportunities, on the other hand, entering into a mature industry can become challenging for a business. The performance of NetScout is also influenced by the government expenditure on the infrastructure development of a country.Whittington et al., (2017) opined, a well-developed country can offer an ample amount of growth opportunities to the intelligence and defence industries.
The shared beliefs and attitudes of a community have a huge impact on making the purchasing decision.Mason (2007) noted, apart from this, gender diversity and different decision-making capability of men and women are directly associated with an organisational operation and performance. The culture of a society assists the NetScout business to understand the behaviour of consumers and help the marketer to design the marketing messages and successfully attract the consumers.
Technological advancement has created an ample number of opportunities for businesses. Putra (2019) stated, it has bought a revolution in the traditional way of businesses. Technological advancement analysis is very much crucial as the technology is moulding every minute and businesses need to cope up with it to sustain the progress. Hamel and Prahalad (1990) mentioned, Netscout always keep them on the updated technological advancements to maintain their competitive advantage and develop their product as per the technological impacts.
Legal frameworks help an organisation to protect the intellectual right of an organisation. Mason (2007) viewed, in the decision-making process, an industry should also include a clear understanding of situational awareness regarding the legal environment.Moreover, there are several factors that need to be evaluated by the NetScout before entering into a new market, such as, Employment law, copyright, patents law, data protection, health and safety law, discrimination law, anti-trust law etc.
As per the view of Cherunilam (2021), different countries have their own different environmental laws to protect the environment that can be impactful for a business in terms of profitability. In some of the countries, the state environmental law and the country environment laws and regulations are different. Such as, In the US, Florida and Texas have different environmental laws and have different liability clauses too. Before entering into a new market NetScout must carefully inspect the existing environmental legislation and standards. The company is strictly adhering to these environmental regulations andstandards implemented by the company to maintain and build loyalty among the consumers. Some crucial environmental factors are laws regarding environmental pollution regulation, waste management, climate change, and attitude towards the green and ecological product and recycling laws.
3. Evaluation of strategic resources and capabilities of NetScout
As per the view of Koutroumanis (2021), competency provides an organisation with the opportunity to enhance, grow and develop for further expansion. In the same way, competencies assist NetScout to exploit available opportunities and leverage the harmful threats caused by various internal and external factors. Such competencies of NetScoutinclude a handful of organisational strengths. Wernerfelt (1984) highlighted, firstly, NetScout always keeps its stakeholders informed regarding the company's activities and their regular engagement in social activities through websites, documents and annual reports. Besides, NetScout’s product has been considered unique and the brand image has been developed over a long period that has created a sense of trust among the consumers. A firm’s growth does not always mean that the company is providing value to its consumers. Rumelt (2012) opined, for creating value among the consumers, a firm should focus more on customer satisfaction, creating innovative product and demand satisfaction of the customers.The brand also enjoys high brand recognition due to its long-term brand investment.Furthermore, NetScout has a globally recognised distribution system and their highly innovative product offering has assisted the company to be more efficient.
As per the view of Barney (1991), rare competencies are unique in nature and help a firm to build a competitive advantage. There is a wide range of rare competencies in NetScout that helps them to strengthen their brand. The global presence of NetScout has helped to build a firm customer base around the world. The organisational culture has allowed the NetScout team to enhance creativity, innovation and teamwork which benefit the company to gain a competitive advantage. Ferreira and Fernandes (2017) noted, the risk assessment function of NetScout is strong and facilitates them to take guided and calculated risks for business growth. Along with all these attributes, high exposure to the global culture has created the adaptable nature of NetScout that has allowed the company to penetrate local regions and improved accessibility.
Barney (1991) stated,inimitable competency helpsan organisation to add value along with competitive advantage.It helps to sustain in the market for the long term and maintain its sustainability.NetScout offers its customers a range of high-quality products that lead the customer to purchase repeatedly from the organisation.The company operates in many countries and the products are easily accessible to consumers.According toPrahalad and Hamel (1990), the company uses marketing communication with the consumers very strategically.They involve their vision and culture in the marketing campaign that has induced higher consumption.Another inimitable resource of NetScout is competitive pricing. In addition,NetScout has reduced its operational cost by implementing technology and controlling the operational cost.
These non-substitutable resources are developed by the Netscout systems and the competitors are not allowed to use this.Wernerfelt (1984) mentioned,these resources allow the organisation to exploit opportunities and assist to use the resources properly in terms of business growth.The financial strength of NetScout has allowed the company to focus on innovation and new product development and launches. Barney and Hesterly, (2019) opined that technological implementation has allowed the company to maintain their efficiency in business processes and manage the global operation smoothly. Besides, the high production capacity of NetScout has facilitated the company to supply its product globally.
4. Growth of NetScout in Poland
As per the statement of Adhikari (2017), This European firm is a market leader in the worldwide aggressive earnings management sectors, achieving financial success through the operation of semi-autonomous business units in more than 50 logistical locations. Revenues have risen in recent years as a result of the company’s diversification of coverage and financial vehicles, new technological collaborations, and many regional acquisitions in Poland. As a result, the company’s revenues for the most completed fiscal year increased significantly.
According to the statement of Anderson (2007), in Poland, the network connection of this company has constantly grown its business with additional and advanced facilities. Like the other countries, the software monitoring solution from NETSCOUT provides real-time warnings and eliminates the guesswork in troubleshooting, correction, and quality improvement. A substantial IT operation keeps this worldwide firm up and running amid this corporate development and the company’s embrace of Information Technology and The Internet of Things (IoT) technologies. Many of the company’s IT centres in Poland have embraced NETSCOUT technologies as the barter system for Support Services throughout the years. In Poland, where phone companies are using similar technologies to analyse new 4G or LTE networks, NetScout predicts good development for its customer support product categories (Anderson, 2007). The local IT team employed NETSCOUT’s nGenius data flow switch (PFS) technology at critical distances to meet their local 10 Gig concept is introduced, and then used the PFS to collect and transmit information to ISNG equipment.
During Q4 and fiscal year-end, 2020 quarterly earnings call on May 7th, NETSCOUT expects to offer a business update. However, given the continuously changing COVID-19 scenario, it is impossible to predict the effect of the epidemic on financial performance with acceptable accuracy. As a result, the Company will hold off on issuing the fiscal year 2021 forecasts until a better understanding of the duration and scope of the COVID-19 epidemic in Poland and globally is available (Adhikari, 2017).
The overall discussion has evaluated critically the current scenario of NetScout technologies and the impact of external factors that are hugely significant in this current context as these issues will help NetScout to create better strategies for evaluating the business operation and gaining competitive advantage. The next section has discussed in detail the available resource and the capabilities of NetScout. The US-based company NetScout has been planning to extend their branch in Poland and in relation to that the last section has enlightened the advantages of extending NetScout branch in Poland and gave a glance of business strategies for the successful expansion with a competitive advantage in Poland.
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