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Progressive 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 Progressive to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for Progressive? Defining Valuable in VRIO
A resource or capability is considered valuable for Progressive , if it allows the
Progressive to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow Progressive to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for Progressive.
What are Rare Resources for Progressive? Defining Rare in VRIO
In an industry that Progressive operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. Progressive require rare resources to compete in the industry. If Progressive don’t have rare resources that are required to succeed in the industry then Progressive won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide Progressive competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for Progressive? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to Progressive 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. Progressive 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 Progressive
What is a Organization for Progressive? Defining Organization in VRIO
Even if the Progressive 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 Progressive 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 |
---|---|---|---|---|---|
Talent to Manage Regulatory and Legal Obligations | Yes | No | Can be imitated by competitors | Yes | Not critical factor |
Opportunities in the Adjacent Industries that Progressive 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 |
Brand Positioning of Progressive 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 |
Opportunities for Brand Extensions for Progressive 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 |
Pricing Strategies of Progressive | Yes, Progressive has sound pricing strategies | No | Pricing strategies are regularly imitated in the industry | Yes, firm has a pricing analytics engine | It can only provide Progressive with a Temporary Competitive Advantage |
Alignment of Activities with Progressive 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 Critical Raw Material for Successful Execution | Yes | Yes, as other competitors have to come to terms with Progressive dominant market position | Can be imitated by competitors | Yes | Providing Sustainable Competitive Advantage |
Supply Chain Network Flexibility of Progressive | Yes | Yes | Near competitors also have flexible supply chain and share some of the suppliers | Fully utilized by Progressive organizational structure and capabilities | Keeps the business running |
Access to Cheap Capital for Progressive | Yes, as a leading player in the industry and current macro economic conditions, Progressive has access to cheap capital | No | Can be imitated by the competitors of Progressive | Not been totally exploited | Not significant in creating competitive advantage |
Position among Retailers and Wholesalers – Progressive retail strategy | Yes, Progressive has strong relationship with retailers and wholesalers | Yes, Progressive has dedicated channel partners | Difficult to imitate though not impossible | Yes, over the years company has used it successfully | Sustainable Competitive Advantage |
Progressive 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 Progressive | Progressive is leveraging the customer loyalty to good effect | Provide Progressive medium term competitive advantage |
Distribution and Logistics Costs Competitiveness | Yes, as it helps Progressive in delivering lower costs | No | Can be imitated by competitors of Progressive but it is difficult | Yes | Medium to Long Term Competitive Advantage |
Brand awareness of Progressive products and services | Yes, the brand awareness of Progressive products are high | Yes, Progressive has one of the leading brand in the industry | No | Progressive has utilized its leading brand position in various segments | Sustainable Competitive Advantage |
Product Portfolio and Synergy among Various Product Lines of Progressive | Yes, it is valuable in the industry given the various segmentations & consumer preferences. | Most of the competitors are trying to enter the lucrative segments | Can be imitated by the competitors | The firm has used it to good effect, details can be found in case exhibit | Provide short term competitive advantage but requires constant innovation to sustain |
Progressive 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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