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Telstra VRIO / VRIN Analysis | Assignment Help
What is VRIO / VRIN Analysis ?
VRIO stands for – Value of the resource, Rareness of the resource, Imitation Risk, and Organizational Competence.
VRIO is a resource focused strategic analysis tool.
To build a sustainable competitive advantage the resources that –casename— needs to be valuable, rare, and difficult to imitate. Secondly the –casename— needs to possess capabilities, organizational structure, and culture to optimize the available resources usage. VRIO analysis can help organizations such as Telstra to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for Telstra? Defining Valuable in VRIO
A resource or capability is considered valuable for Telstra , if it allows the
Telstra to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow Telstra to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for Telstra.
What are Rare Resources for Telstra? Defining Rare in VRIO
In an industry that Telstra operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. Telstra require rare resources to compete in the industry. If Telstra don’t have rare resources that are required to succeed in the industry then Telstra won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide Telstra competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for Telstra? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to Telstra for certain period of time as all the competitors are going to try to imitate or replicate that resource. A sustained competitive advantage emerges, if the resource is difficult to imitate by the competitors. Telstra can create inmitability by innovating on the product side, reducing pain points on service delivery, and having an effective post sales servicing strategy.
Check out the SWOT analysis of Telstra
What is a Organization for Telstra? Defining Organization in VRIO
Even if the Telstra has all the valuable resources that are both rare and difficult to imitate, it won’t automatically result into a sustainable competitive advantage. The key to build the sustainable competitive advantage is to have organizational capabilities, expertise, and structure to exploit the resources. If Telstra is not organized based on its strengths then it won’t able to exploit all the resources that it possesses.
Resources | Value | Rare | Imitation | Organization | Competitive Advantage |
---|---|---|---|---|---|
Vision of the Leadership for Next Set of Challenges | Yes | No | Can't be imitated by competitors of Telstra | Not based on information provided in the case | Can Lead to Strong Competitive Advantage |
Access to Critical Raw Material for Successful Execution | Yes | Yes, as other competitors have to come to terms with Telstra dominant market position | Can be imitated by competitors | Yes | Providing Sustainable Competitive Advantage |
Alignment of Activities with Telstra Corporate Strategy | Yes | No | Each of the firm has its own strategy | Yes, company has organizational skills to extract the maximum out of it. | Still lots of potential to build on it |
Supply Chain Network Flexibility of Telstra | Yes | Yes | Near competitors also have flexible supply chain and share some of the suppliers | Fully utilized by Telstra organizational structure and capabilities | Keeps the business running |
Customer Community of Telstra | Yes, as customers are co-creating products | Yes, the Telstra has able to build a special relationship with its customers | It is very difficult for Telstra competitors to imitate the culture and community dedication | Going by the data, there is still a lot of upside in building on Telstra customers community ecosystem | Providing Strong Competitive Advantage |
Financial Resources of Telstra | Yes | No | Financial instruments and market liquidity are available to all the nearest competitors | Telstra has reasonably sound financial position | Telstra has relatively sustainable Competitive Advantage |
Ability to Attract Talent in Various Local & Global Markets | Yes, Telstra strategy is built on successful innovation and localization of products | Yes, as talent is critical to firm's growth | Difficult to imitate for the current competitors of Telstra | To a large extent yes | Providing Strong Competitive Advantage |
Opportunities for Brand Extensions for Telstra products | Yes, new niches are emerging in the market | No, as most of the competitors are also targeting those niches | Yes can be imitated by the competitors | Brand extensions will require higher marketing budget | Temporary Competitive Advantage |
Pricing Strategies of Telstra | Yes, Telstra has sound pricing strategies | No | Pricing strategies are regularly imitated in the industry | Yes, firm has a pricing analytics engine | It can only provide Telstra with a Temporary Competitive Advantage |
Brand Positioning of Telstra in Comparison to the Competitors | Yes | No | Can be imitated by competitors but it will require big marketing budget | Yes, the firm has positioned its brands based on consumer behavior | Temporary Competitive Advantage |
Opportunities in the E-Commerce Space for Telstra - using Present IT Capabilities | Yes, the e-commerce space is rapidly growing and Telstra can exploit the emerging opportunities | No, most of the competitors are investing in IT to enter the space | The AI and inhouse analytics can be difficult to imitate | It is just the start for the organization | In the long run it can provide sustainable competitive advantage |
Brand awareness of Telstra products and services | Yes, the brand awareness of Telstra products are high | Yes, Telstra has one of the leading brand in the industry | No | Telstra has utilized its leading brand position in various segments | Sustainable Competitive Advantage |
Global and Local Presence of Telstra | Yes, as it diversify the revenue streams and isolate company's balance sheet from economic cycles | Yes | Can be imitated by competitors of Telstra but at a relatively high cost | Yes, it is one of the most diversified companies in its industry | Providing Strong Competitive Advantage |
Distribution and Logistics Costs Competitiveness | Yes, as it helps Telstra in delivering lower costs | No | Can be imitated by competitors of Telstra but it is difficult | Yes | Medium to Long Term Competitive Advantage |
Telstra SWOT Analysis, SWOT Matrix, Weighted SWOT Case Study Solution & Analysis
Books and References
Ahir Gopaldas and Anton Siebert (2022 July August) "What You’re Getting Wrong About Customer Journeys",
Harvard Business Review , 92
Linda A. Hill, Emily Tedards, and Taran Swan (2021) "Drive Innovation with Better Decision-Making", Harvard Business Review 86
Dyer, J. H., & Hatch, N. (2004). Using Supplier Networks to Learn Faster. Sloan Management Review, 45(3), 57–63
Barney, J. B. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17, 99–120
Dyer, J. H., Kale, P., & Singh, H. (2004, July–August). When to ally and when to acquire. Harvard Business Review, 109–115
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