Michael Kors 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 Michael Kors to do better resource allocation and build a defensible value and supply chain.

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What is a Valuable Resource for Michael Kors? Defining Valuable in VRIO

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

What are Rare Resources for Michael Kors? Defining Rare in VRIO

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

What is a Inimitable (Difficult to Immitate) Resource for Michael Kors? Defining Inimitable in VRIO

A valuable and rare resource can provide a competitive advantage to Michael Kors 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. Michael Kors 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 Michael Kors

What is a Organization for Michael Kors? Defining Organization in VRIO

Even if the Michael Kors 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 Michael Kors 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 Michael Kors	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
Ability to Attract Talent in Various Local & Global Markets	Yes, Michael Kors 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 Michael Kors	To a large extent yes	Providing Strong Competitive Advantage
Sales Force and Channel Management of Michael Kors	Yes	No	Can be imitated by competitors	Still there is lot of potential to utilize the excellent sales force	Can provide Michael Kors sustainable competitive advantage. Potential is certainly there.
Marketing Expertise within Michael Kors	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 Michael Kors are often matched by competitors	Yes, Michael Kors is leveraging both its inhouse marketing department and external expertise	Temporary Competitive Advantage
Brand Positioning of Michael Kors 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 Michael Kors dominant market position	Can be imitated by competitors	Yes	Providing Sustainable Competitive Advantage
Customer Community of Michael Kors	Yes, as customers are co-creating products	Yes, the Michael Kors has able to build a special relationship with its customers	It is very difficult for Michael Kors competitors to imitate the culture and community dedication	Going by the data, there is still a lot of upside in building on Michael Kors customers community ecosystem	Providing Strong Competitive Advantage
Financial Resources of Michael Kors	Yes	No	Financial instruments and market liquidity are available to all the nearest competitors	Michael Kors has reasonably sound financial position	Michael Kors has relatively sustainable Competitive Advantage
Pricing Strategies of Michael Kors	Yes, Michael Kors has sound pricing strategies	No	Pricing strategies are regularly imitated in the industry	Yes, firm has a pricing analytics engine	It can only provide Michael Kors with a Temporary Competitive Advantage
Opportunities for Brand Extensions for Michael Kors 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
Talent to Manage Regulatory and Legal Obligations	Yes	No	Can be imitated by competitors	Yes	Not critical factor
Michael Kors 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 Michael Kors	Michael Kors is leveraging the customer loyalty to good effect	Provide Michael Kors medium term competitive advantage
Opportunities in the E-Commerce Space for Michael Kors - using Present IT Capabilities	Yes, the e-commerce space is rapidly growing and Michael Kors 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
Distribution and Logistics Costs Competitiveness	Yes, as it helps Michael Kors in delivering lower costs	No	Can be imitated by competitors of Michael Kors but it is difficult	Yes	Medium to Long Term Competitive Advantage

Michael Kors 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