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7-Eleven 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 7-Eleven to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for 7-Eleven? Defining Valuable in VRIO
A resource or capability is considered valuable for 7-Eleven , if it allows the
7-Eleven to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow 7-Eleven to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for 7-Eleven.
What are Rare Resources for 7-Eleven? Defining Rare in VRIO
In an industry that 7-Eleven operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. 7-Eleven require rare resources to compete in the industry. If 7-Eleven don’t have rare resources that are required to succeed in the industry then 7-Eleven won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide 7-Eleven competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for 7-Eleven? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to 7-Eleven 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. 7-Eleven 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 7-Eleven
What is a Organization for 7-Eleven? Defining Organization in VRIO
Even if the 7-Eleven 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 7-Eleven 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 awareness of 7-Eleven products and services | Yes, the brand awareness of 7-Eleven products are high | Yes, 7-Eleven has one of the leading brand in the industry | No | 7-Eleven has utilized its leading brand position in various segments | Sustainable Competitive Advantage |
Supply Chain Network Flexibility of 7-Eleven | Yes | Yes | Near competitors also have flexible supply chain and share some of the suppliers | Fully utilized by 7-Eleven organizational structure and capabilities | Keeps the business running |
7-Eleven 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 7-Eleven | 7-Eleven is leveraging the customer loyalty to good effect | Provide 7-Eleven medium term competitive advantage |
Marketing Expertise within 7-Eleven | 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 7-Eleven are often matched by competitors | Yes, 7-Eleven is leveraging both its inhouse marketing department and external expertise | Temporary Competitive Advantage |
Position among Retailers and Wholesalers – 7-Eleven retail strategy | Yes, 7-Eleven has strong relationship with retailers and wholesalers | Yes, 7-Eleven has dedicated channel partners | Difficult to imitate though not impossible | Yes, over the years company has used it successfully | Sustainable Competitive Advantage |
Customer Community of 7-Eleven | Yes, as customers are co-creating products | Yes, the 7-Eleven has able to build a special relationship with its customers | It is very difficult for 7-Eleven competitors to imitate the culture and community dedication | Going by the data, there is still a lot of upside in building on 7-Eleven customers community ecosystem | Providing Strong Competitive Advantage |
Brand Positioning of 7-Eleven 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 |
Access to Critical Raw Material for Successful Execution | Yes | Yes, as other competitors have to come to terms with 7-Eleven dominant market position | Can be imitated by competitors | Yes | Providing Sustainable Competitive Advantage |
Vision of the Leadership for Next Set of Challenges | Yes | No | Can't be imitated by competitors of 7-Eleven | Not based on information provided in the case | Can Lead to Strong Competitive Advantage |
Intellectual Property Rights, Copyrights, and Trademarks | Yes, they are extremely valuable for 7-Eleven to thwart competition | Yes, IPR and other rights are rare and competition of 7-Eleven 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 |
Successful Implementation of Digital Strategy at 7-Eleven | 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 |
Opportunities in the Adjacent Industries that 7-Eleven 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 |
Opportunities for Brand Extensions for 7-Eleven 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 |
Track Record of Leadership Team at 7-Eleven | Yes | Yes | Can't be imitated by competitors | Yes | Providing Strong Competitive Advantage |
7-Eleven 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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