Humana Inc 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 Humana Inc to do better resource allocation and build a defensible value and supply chain.

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What is a Valuable Resource for Humana Inc? Defining Valuable in VRIO

A resource or capability is considered valuable for Humana Inc , if it allows the Humana Inc to exploit opportunities or negate threats emerging out of both the micro business environment and the macro environment. If a resource does not allow Humana Inc to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for Humana Inc.

What are Rare Resources for Humana Inc? Defining Rare in VRIO

In an industry that Humana Inc operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. Humana Inc require rare resources to compete in the industry. If Humana Inc don’t have rare resources that are required to succeed in the industry then Humana Inc won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide Humana Inc competitive advantage against players that don’t have those rare resources. HBR Case Study Solution

What is a Inimitable (Difficult to Immitate) Resource for Humana Inc? Defining Inimitable in VRIO

A valuable and rare resource can provide a competitive advantage to Humana Inc 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. Humana Inc 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 Humana Inc

What is a Organization for Humana Inc? Defining Organization in VRIO

Even if the Humana Inc 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 Humana Inc 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
Successful Implementation of Digital Strategy at Humana Inc	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
Marketing Expertise within Humana Inc	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 Humana Inc are often matched by competitors	Yes, Humana Inc is leveraging both its inhouse marketing department and external expertise	Temporary Competitive Advantage
Access to Critical Raw Material for Successful Execution	Yes	Yes, as other competitors have to come to terms with Humana Inc dominant market position	Can be imitated by competitors	Yes	Providing Sustainable Competitive Advantage
Opportunities for Brand Extensions for Humana Inc 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
Opportunities in the E-Commerce Space for Humana Inc - using Present IT Capabilities	Yes, the e-commerce space is rapidly growing and Humana Inc 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
Financial Resources of Humana Inc	Yes	No	Financial instruments and market liquidity are available to all the nearest competitors	Humana Inc has reasonably sound financial position	Humana Inc has relatively sustainable Competitive Advantage
Brand awareness of Humana Inc products and services	Yes, the brand awareness of Humana Inc products are high	Yes, Humana Inc has one of the leading brand in the industry	No	Humana Inc has utilized its leading brand position in various segments	Sustainable Competitive Advantage
Opportunities in the Adjacent Industries that Humana Inc can exploit & New Resources Required to Enter those Industries	Can be valuable as they will create new revenue streams	No	Can be imitated by competitors	All the capabilities of the organization are not fully utilized yet	Has potential
Intellectual Property Rights, Copyrights, and Trademarks	Yes, they are extremely valuable for Humana Inc to thwart competition	Yes, IPR and other rights are rare and competition of Humana Inc will find it extremely difficult to copy	Risk of imitation is low but given the margins in the industry disruption chances are high	So far the firm has not utilized the full extent of its IPR & other properties	Providing Strong Competitive Advantage
Alignment of Activities with Humana Inc 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
Talent to Manage Regulatory and Legal Obligations	Yes	No	Can be imitated by competitors	Yes	Not critical factor
Vision of the Leadership for Next Set of Challenges	Yes	No	Can't be imitated by competitors of Humana Inc	Not based on information provided in the case	Can Lead to Strong Competitive Advantage
Pricing Strategies of Humana Inc	Yes, Humana Inc has sound pricing strategies	No	Pricing strategies are regularly imitated in the industry	Yes, firm has a pricing analytics engine	It can only provide Humana Inc with a Temporary Competitive Advantage
Humana Inc Customer Network and Loyalty	Yes, 23% of the customers contribute to more than 84% of the sales revenue	Yes, firm has invested to build a strong customer loyalty	Has been tried by competitors but none of them are as successful as Humana Inc	Humana Inc is leveraging the customer loyalty to good effect	Provide Humana Inc medium term competitive advantage

Humana Inc 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