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STC 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 STC to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for STC? Defining Valuable in VRIO
A resource or capability is considered valuable for STC , if it allows the
STC to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow STC to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for STC.
What are Rare Resources for STC? Defining Rare in VRIO
In an industry that STC operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. STC require rare resources to compete in the industry. If STC don’t have rare resources that are required to succeed in the industry then STC won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide STC competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for STC? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to STC 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. STC 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 STC
What is a Organization for STC? Defining Organization in VRIO
Even if the STC 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 STC 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 |
---|---|---|---|---|---|
Track Record of Leadership Team at STC | Yes | Yes | Can't be imitated by competitors | Yes | Providing Strong Competitive Advantage |
Opportunities for Brand Extensions for STC 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 |
Successful Implementation of Digital Strategy at STC | 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 |
Access to Critical Raw Material for Successful Execution | Yes | Yes, as other competitors have to come to terms with STC dominant market position | Can be imitated by competitors | Yes | Providing Sustainable Competitive Advantage |
Brand awareness of STC products and services | Yes, the brand awareness of STC products are high | Yes, STC has one of the leading brand in the industry | No | STC has utilized its leading brand position in various segments | Sustainable Competitive Advantage |
Sales Force and Channel Management of STC | Yes | No | Can be imitated by competitors | Still there is lot of potential to utilize the excellent sales force | Can provide STC sustainable competitive advantage. Potential is certainly there. |
Distribution and Logistics Costs Competitiveness | Yes, as it helps STC in delivering lower costs | No | Can be imitated by competitors of STC but it is difficult | Yes | Medium to Long Term Competitive Advantage |
Track Record of Project Execution | Yes, especially in an industry where there are frequent cost overun | Yes, especially in the segment that STC operates in | No, none of the competitors so far has able to imitate this expertise | Yes, STC is successful at it | Providing Strong Competitive Advantage |
Marketing Expertise within STC | 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 STC are often matched by competitors | Yes, STC is leveraging both its inhouse marketing department and external expertise | Temporary Competitive Advantage |
Alignment of Activities with STC 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 |
Ability to Attract Talent in Various Local & Global Markets | Yes, STC 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 STC | To a large extent yes | Providing Strong Competitive Advantage |
Position among Retailers and Wholesalers – STC retail strategy | Yes, STC has strong relationship with retailers and wholesalers | Yes, STC has dedicated channel partners | Difficult to imitate though not impossible | Yes, over the years company has used it successfully | Sustainable Competitive Advantage |
Talent to Manage Regulatory and Legal Obligations | Yes | No | Can be imitated by competitors | Yes | Not critical factor |
Global and Local Presence of STC | Yes, as it diversify the revenue streams and isolate company's balance sheet from economic cycles | Yes | Can be imitated by competitors of STC but at a relatively high cost | Yes, it is one of the most diversified companies in its industry | Providing Strong Competitive Advantage |
STC 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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