Rolls Royce (Aerospace and Defense) 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 Rolls Royce (Aerospace and Defense) to do better resource allocation and build a defensible value and supply chain.

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What is a Valuable Resource for Rolls Royce (Aerospace and Defense)? Defining Valuable in VRIO

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

What are Rare Resources for Rolls Royce (Aerospace and Defense)? Defining Rare in VRIO

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

What is a Inimitable (Difficult to Immitate) Resource for Rolls Royce (Aerospace and Defense)? Defining Inimitable in VRIO

A valuable and rare resource can provide a competitive advantage to Rolls Royce (Aerospace and Defense) 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. Rolls Royce (Aerospace and Defense) 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 Rolls Royce (Aerospace and Defense)

What is a Organization for Rolls Royce (Aerospace and Defense)? Defining Organization in VRIO

Even if the Rolls Royce (Aerospace and Defense) 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 Rolls Royce (Aerospace and Defense) 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 Project Execution	Yes, especially in an industry where there are frequent cost overun	Yes, especially in the segment that Rolls Royce (Aerospace and Defense) operates in	No, none of the competitors so far has able to imitate this expertise	Yes, Rolls Royce (Aerospace and Defense) is successful at it	Providing Strong Competitive Advantage
Opportunities for Brand Extensions for Rolls Royce (Aerospace and Defense) 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 Rolls Royce (Aerospace and Defense)	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
Talent to Manage Regulatory and Legal Obligations	Yes	No	Can be imitated by competitors	Yes	Not critical factor
Track Record of Leadership Team at Rolls Royce (Aerospace and Defense)	Yes	Yes	Can't be imitated by competitors	Yes	Providing Strong Competitive Advantage
Marketing Expertise within Rolls Royce (Aerospace and Defense)	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 Rolls Royce (Aerospace and Defense) are often matched by competitors	Yes, Rolls Royce (Aerospace and Defense) is leveraging both its inhouse marketing department and external expertise	Temporary Competitive Advantage
Vision of the Leadership for Next Set of Challenges	Yes	No	Can't be imitated by competitors of Rolls Royce (Aerospace and Defense)	Not based on information provided in the case	Can Lead to Strong Competitive Advantage
Customer Community of Rolls Royce (Aerospace and Defense)	Yes, as customers are co-creating products	Yes, the Rolls Royce (Aerospace and Defense) has able to build a special relationship with its customers	It is very difficult for Rolls Royce (Aerospace and Defense) competitors to imitate the culture and community dedication	Going by the data, there is still a lot of upside in building on Rolls Royce (Aerospace and Defense) customers community ecosystem	Providing Strong Competitive Advantage
Distribution and Logistics Costs Competitiveness	Yes, as it helps Rolls Royce (Aerospace and Defense) in delivering lower costs	No	Can be imitated by competitors of Rolls Royce (Aerospace and Defense) but it is difficult	Yes	Medium to Long Term Competitive Advantage
Brand awareness of Rolls Royce (Aerospace and Defense) products and services	Yes, the brand awareness of Rolls Royce (Aerospace and Defense) products are high	Yes, Rolls Royce (Aerospace and Defense) has one of the leading brand in the industry	No	Rolls Royce (Aerospace and Defense) has utilized its leading brand position in various segments	Sustainable Competitive Advantage
Rolls Royce (Aerospace and Defense) 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 Rolls Royce (Aerospace and Defense)	Rolls Royce (Aerospace and Defense) is leveraging the customer loyalty to good effect	Provide Rolls Royce (Aerospace and Defense) medium term competitive advantage
Intellectual Property Rights, Copyrights, and Trademarks	Yes, they are extremely valuable for Rolls Royce (Aerospace and Defense) to thwart competition	Yes, IPR and other rights are rare and competition of Rolls Royce (Aerospace and Defense) 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
Supply Chain Network Flexibility of Rolls Royce (Aerospace and Defense)	Yes	Yes	Near competitors also have flexible supply chain and share some of the suppliers	Fully utilized by Rolls Royce (Aerospace and Defense) organizational structure and capabilities	Keeps the business running
Alignment of Activities with Rolls Royce (Aerospace and Defense) 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

Rolls Royce (Aerospace and Defense) SWOT Analysis, SWOT Matrix, Weighted SWOT Case Study Solution & Analysis

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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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