Visa’s Internal Environment: Assets, Capabilities and Advantages

Tangible Assets 

Visa Inc., a global electronic payments company, headquartered in California, facilitates individuals, banks, businesses, and governments’ use of digital payments. Visa is listed among the Fortune 500 companies, owing to its asset value of $60 billion and a recorded annual revenue of $19.34 billion in 2017 (Forbes, 2018). Applying a resource-based view of the firm to review their tangible assets which include the financial and physical assets, technology and organizational framework (Dess, McNamara, & Eisner, 2012), the contribution of these assets to the success of the company becomes apparent. Visa is headquartered in California but commands an enviable presence worldwide. Through their global partnerships, the company’s reports that over 2.5 billion Visa cards are in active use globally (Visa, 2018). Visa’s operations identify the potential of the digital currency industry with its exponential increase in users, therefore looks to provide services to fulfil customer needs that cannot be met by the traditional banking or money transfer systems. The organizational structure of the company allows it to run operations according to geographical settings hence their presence in Europe and all the other continents. The company also operates through subsidiaries such as Payspan and Cybersource hence giving them an edge over competitors. 

Intangible assets 

Visa’s major assets are their brand name and image which sets the company apart as a leader in fast electronic transactions. The brand name was built over the years since the company was founded in 1958 (Visa, 2018). The Visa logo is easily identifiable in the company’s cards thus enabling the enhancement of their physical presence. The firm's strong reputation also accounts for their intangible resources. Trust, confidence, and reliability are the most crucial aspects of Visa’s business operations. Visa has built a strong reputation as a reliable conduit enabling global payments to the extent that governments and business prefer their payment systems. Building such as reputation requires astute managerial skills and a competent workforce. Visa’s 15 million staff are assessed for their abilities and honesty before they are hired. Importantly, the company operates in a dynamic technological world hence innovation is a vital asset. For instance, their contactless swipe method was well-received and enabled them to stay a step ahead of competitors. 

Organizational Capabilities 

Organizational capabilities allow for the utilization of tangible and intangible resource to achieve the desired quality of service (Dess, McNamara, & Eisner, 2012). In Visa’s case, their main capability is the ability to identify customer needs and come up with innovative solutions to fulfil the requirements. Visa partners with customers such as governments and businesses to provide tailored solutions, unlike other avenues like online payment systems which do not offer customer-specific services. Additionally, the company’s vast experience with electronic payments systems and its unique characteristics enables them to adjust to change quickly. The company’s skilled staff are the primary developers of their innovative systems which allows them to utilize their financial capabilities to achieve success. 

Sustainable Competitive Advantage 

Visa Inc. draws its competitive advantage from its financial assets, human resources, global presence and the firm’s capabilities. The company’s $19.34 annual revenue together with a $60 billion asset value provides a strong borrowing capacity and an even more viable equity raising ability than most of its competitors. Thus, they can handle billions of transaction and also expand to new markets in developing countries. The company’s reputation also enables them to attract the best talent in the job market and enhance the innovative abilities and improve on the quality of services that they offer. Although the company faces stiff competition from firms such as MasterCard and PayPal, their global presence in over 200 companies guarantees a strong business position. 

References 

Dess, G. G., McNamara, G., & Eisner, A. B. (2012). The strategic management process. New York, NY: McGraw-Hill Education. 

Forbes. (2018). The world's largest companies . Forbes. Retrieved on 14 June 2018, from, https://www.forbes.com/companies/visa/ 

Visa. (2018). Visa . Visa.com. Retrieved on 14 June 2018 from, 

https://usa.visa.com/about-visa/our_business/global-presence.html