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Raytheon 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 Raytheon to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for Raytheon? Defining Valuable in VRIO
A resource or capability is considered valuable for Raytheon , if it allows the
Raytheon to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow Raytheon to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for Raytheon.
What are Rare Resources for Raytheon? Defining Rare in VRIO
In an industry that Raytheon operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. Raytheon require rare resources to compete in the industry. If Raytheon don’t have rare resources that are required to succeed in the industry then Raytheon won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide Raytheon competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for Raytheon? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to Raytheon 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. Raytheon 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 Raytheon
What is a Organization for Raytheon? Defining Organization in VRIO
Even if the Raytheon 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 Raytheon 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 |
---|---|---|---|---|---|
Position among Retailers and Wholesalers – Raytheon retail strategy | Yes, Raytheon has strong relationship with retailers and wholesalers | Yes, Raytheon has dedicated channel partners | Difficult to imitate though not impossible | Yes, over the years company has used it successfully | Sustainable Competitive Advantage |
Track Record of Project Execution | Yes, especially in an industry where there are frequent cost overun | Yes, especially in the segment that Raytheon operates in | No, none of the competitors so far has able to imitate this expertise | Yes, Raytheon is successful at it | Providing Strong Competitive Advantage |
Brand awareness of Raytheon products and services | Yes, the brand awareness of Raytheon products are high | Yes, Raytheon has one of the leading brand in the industry | No | Raytheon has utilized its leading brand position in various segments | Sustainable Competitive Advantage |
Supply Chain Network Flexibility of Raytheon | Yes | Yes | Near competitors also have flexible supply chain and share some of the suppliers | Fully utilized by Raytheon organizational structure and capabilities | Keeps the business running |
Global and Local Presence of Raytheon | Yes, as it diversify the revenue streams and isolate company's balance sheet from economic cycles | Yes | Can be imitated by competitors of Raytheon but at a relatively high cost | Yes, it is one of the most diversified companies in its industry | Providing Strong Competitive Advantage |
Access to Critical Raw Material for Successful Execution | Yes | Yes, as other competitors have to come to terms with Raytheon dominant market position | Can be imitated by competitors | Yes | Providing Sustainable Competitive Advantage |
Opportunities for Brand Extensions for Raytheon 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 |
Brand Positioning of Raytheon 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 |
Vision of the Leadership for Next Set of Challenges | Yes | No | Can't be imitated by competitors of Raytheon | Not based on information provided in the case | Can Lead to Strong Competitive Advantage |
Alignment of Activities with Raytheon 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 |
Access to Cheap Capital for Raytheon | Yes, as a leading player in the industry and current macro economic conditions, Raytheon has access to cheap capital | No | Can be imitated by the competitors of Raytheon | Not been totally exploited | Not significant in creating competitive advantage |
Marketing Expertise within Raytheon | 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 Raytheon are often matched by competitors | Yes, Raytheon is leveraging both its inhouse marketing department and external expertise | Temporary Competitive Advantage |
Financial Resources of Raytheon | Yes | No | Financial instruments and market liquidity are available to all the nearest competitors | Raytheon has reasonably sound financial position | Raytheon has relatively sustainable Competitive Advantage |
Track Record of Leadership Team at Raytheon | Yes | Yes | Can't be imitated by competitors | Yes | Providing Strong Competitive Advantage |
Raytheon 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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