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Delta 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 Delta to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for Delta? Defining Valuable in VRIO
A resource or capability is considered valuable for Delta , if it allows the
Delta to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow Delta to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for Delta.
What are Rare Resources for Delta? Defining Rare in VRIO
In an industry that Delta operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. Delta require rare resources to compete in the industry. If Delta don’t have rare resources that are required to succeed in the industry then Delta won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide Delta competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for Delta? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to Delta 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. Delta 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 Delta
What is a Organization for Delta? Defining Organization in VRIO
Even if the Delta 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 Delta 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 |
---|---|---|---|---|---|
Access to Critical Raw Material for Successful Execution | Yes | Yes, as other competitors have to come to terms with Delta dominant market position | Can be imitated by competitors | Yes | Providing Sustainable Competitive Advantage |
Intellectual Property Rights, Copyrights, and Trademarks | Yes, they are extremely valuable for Delta to thwart competition | Yes, IPR and other rights are rare and competition of Delta 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 |
Marketing Expertise within Delta | 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 Delta are often matched by competitors | Yes, Delta is leveraging both its inhouse marketing department and external expertise | Temporary Competitive Advantage |
Vision of the Leadership for Next Set of Challenges | Yes | No | Can't be imitated by competitors of Delta | Not based on information provided in the case | Can Lead to Strong Competitive Advantage |
Talent to Manage Regulatory and Legal Obligations | Yes | No | Can be imitated by competitors | Yes | Not critical factor |
Ability to Attract Talent in Various Local & Global Markets | Yes, Delta 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 Delta | To a large extent yes | Providing Strong Competitive Advantage |
Brand Positioning of Delta 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 |
Customer Community of Delta | Yes, as customers are co-creating products | Yes, the Delta has able to build a special relationship with its customers | It is very difficult for Delta competitors to imitate the culture and community dedication | Going by the data, there is still a lot of upside in building on Delta customers community ecosystem | Providing Strong Competitive Advantage |
Delta 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 Delta | Delta is leveraging the customer loyalty to good effect | Provide Delta medium term competitive advantage |
Opportunities for Brand Extensions for Delta 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 |
Position among Retailers and Wholesalers – Delta retail strategy | Yes, Delta has strong relationship with retailers and wholesalers | Yes, Delta has dedicated channel partners | Difficult to imitate though not impossible | Yes, over the years company has used it successfully | Sustainable Competitive Advantage |
Brand awareness of Delta products and services | Yes, the brand awareness of Delta products are high | Yes, Delta has one of the leading brand in the industry | No | Delta has utilized its leading brand position in various segments | Sustainable Competitive Advantage |
Track Record of Leadership Team at Delta | Yes | Yes | Can't be imitated by competitors | Yes | Providing Strong Competitive Advantage |
Access to Cheap Capital for Delta | Yes, as a leading player in the industry and current macro economic conditions, Delta has access to cheap capital | No | Can be imitated by the competitors of Delta | Not been totally exploited | Not significant in creating competitive advantage |
Delta 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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