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Airbus 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 Airbus to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for Airbus? Defining Valuable in VRIO
A resource or capability is considered valuable for Airbus , if it allows the
Airbus to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow Airbus to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for Airbus.
What are Rare Resources for Airbus? Defining Rare in VRIO
In an industry that Airbus operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. Airbus require rare resources to compete in the industry. If Airbus don’t have rare resources that are required to succeed in the industry then Airbus won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide Airbus competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for Airbus? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to Airbus 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. Airbus 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 Airbus
What is a Organization for Airbus? Defining Organization in VRIO
Even if the Airbus 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 Airbus 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 |
---|---|---|---|---|---|
Brand Positioning of Airbus 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 |
Track Record of Project Execution | Yes, especially in an industry where there are frequent cost overun | Yes, especially in the segment that Airbus operates in | No, none of the competitors so far has able to imitate this expertise | Yes, Airbus is successful at it | Providing Strong Competitive Advantage |
Pricing Strategies of Airbus | Yes, Airbus has sound pricing strategies | No | Pricing strategies are regularly imitated in the industry | Yes, firm has a pricing analytics engine | It can only provide Airbus with a Temporary Competitive Advantage |
Distribution and Logistics Costs Competitiveness | Yes, as it helps Airbus in delivering lower costs | No | Can be imitated by competitors of Airbus but it is difficult | Yes | Medium to Long Term Competitive Advantage |
Alignment of Activities with Airbus 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 |
Sales Force and Channel Management of Airbus | Yes | No | Can be imitated by competitors | Still there is lot of potential to utilize the excellent sales force | Can provide Airbus sustainable competitive advantage. Potential is certainly there. |
Track Record of Leadership Team at Airbus | Yes | Yes | Can't be imitated by competitors | Yes | Providing Strong Competitive Advantage |
Global and Local Presence of Airbus | Yes, as it diversify the revenue streams and isolate company's balance sheet from economic cycles | Yes | Can be imitated by competitors of Airbus but at a relatively high cost | Yes, it is one of the most diversified companies in its industry | Providing Strong Competitive Advantage |
Successful Implementation of Digital Strategy at Airbus | Yes, without a comprehensive digital strategy it is extremely difficult to compete | No, as most of the firms are investing into digitalizing operations | Can be imitated by competitors | One of the leading player in the industry | Digital strategy has become critical in the industry but it can't provide sustainable competitive advantage to |
Supply Chain Network Flexibility of Airbus | Yes | Yes | Near competitors also have flexible supply chain and share some of the suppliers | Fully utilized by Airbus organizational structure and capabilities | Keeps the business running |
Ability to Attract Talent in Various Local & Global Markets | Yes, Airbus 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 Airbus | To a large extent yes | Providing Strong Competitive Advantage |
Opportunities in the E-Commerce Space for Airbus - using Present IT Capabilities | Yes, the e-commerce space is rapidly growing and Airbus 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 |
Position among Retailers and Wholesalers – Airbus retail strategy | Yes, Airbus has strong relationship with retailers and wholesalers | Yes, Airbus has dedicated channel partners | Difficult to imitate though not impossible | Yes, over the years company has used it successfully | Sustainable Competitive Advantage |
Marketing Expertise within Airbus | Yes, firms are competing based on differentiation in the industry | No, as most of the competitors also have good marketing departments and expertise | Pricing strategies of Airbus are often matched by competitors | Yes, Airbus is leveraging both its inhouse marketing department and external expertise | Temporary Competitive Advantage |
Airbus 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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