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Hartford Financial Services Group 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 Hartford Financial Services Group to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for Hartford Financial Services Group? Defining Valuable in VRIO
A resource or capability is considered valuable for Hartford Financial Services Group , if it allows the
Hartford Financial Services Group to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow Hartford Financial Services Group to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for Hartford Financial Services Group.
What are Rare Resources for Hartford Financial Services Group? Defining Rare in VRIO
In an industry that Hartford Financial Services Group operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. Hartford Financial Services Group require rare resources to compete in the industry. If Hartford Financial Services Group don’t have rare resources that are required to succeed in the industry then Hartford Financial Services Group won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide Hartford Financial Services Group competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for Hartford Financial Services Group? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to Hartford Financial Services Group 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. Hartford Financial Services Group 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 Hartford Financial Services Group
What is a Organization for Hartford Financial Services Group? Defining Organization in VRIO
Even if the Hartford Financial Services Group 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 Hartford Financial Services Group 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 |
---|---|---|---|---|---|
Hartford Financial Services Group 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 Hartford Financial Services Group | Hartford Financial Services Group is leveraging the customer loyalty to good effect | Provide Hartford Financial Services Group medium term competitive advantage |
Financial Resources of Hartford Financial Services Group | Yes | No | Financial instruments and market liquidity are available to all the nearest competitors | Hartford Financial Services Group has reasonably sound financial position | Hartford Financial Services Group has relatively sustainable Competitive Advantage |
Vision of the Leadership for Next Set of Challenges | Yes | No | Can't be imitated by competitors of Hartford Financial Services Group | Not based on information provided in the case | Can Lead to Strong 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 Hartford Financial Services Group | Yes, as it diversify the revenue streams and isolate company's balance sheet from economic cycles | Yes | Can be imitated by competitors of Hartford Financial Services Group but at a relatively high cost | Yes, it is one of the most diversified companies in its industry | Providing Strong Competitive Advantage |
Pricing Strategies of Hartford Financial Services Group | Yes, Hartford Financial Services Group has sound pricing strategies | No | Pricing strategies are regularly imitated in the industry | Yes, firm has a pricing analytics engine | It can only provide Hartford Financial Services Group with a Temporary Competitive Advantage |
Customer Community of Hartford Financial Services Group | Yes, as customers are co-creating products | Yes, the Hartford Financial Services Group has able to build a special relationship with its customers | It is very difficult for Hartford Financial Services Group competitors to imitate the culture and community dedication | Going by the data, there is still a lot of upside in building on Hartford Financial Services Group customers community ecosystem | Providing Strong Competitive Advantage |
Position among Retailers and Wholesalers – Hartford Financial Services Group retail strategy | Yes, Hartford Financial Services Group has strong relationship with retailers and wholesalers | Yes, Hartford Financial Services Group has dedicated channel partners | Difficult to imitate though not impossible | Yes, over the years company has used it successfully | Sustainable Competitive Advantage |
Brand Positioning of Hartford Financial Services Group 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 |
Ability to Attract Talent in Various Local & Global Markets | Yes, Hartford Financial Services Group 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 Hartford Financial Services Group | To a large extent yes | Providing Strong Competitive Advantage |
Access to Critical Raw Material for Successful Execution | Yes | Yes, as other competitors have to come to terms with Hartford Financial Services Group dominant market position | Can be imitated by competitors | Yes | Providing Sustainable Competitive Advantage |
Track Record of Project Execution | Yes, especially in an industry where there are frequent cost overun | Yes, especially in the segment that Hartford Financial Services Group operates in | No, none of the competitors so far has able to imitate this expertise | Yes, Hartford Financial Services Group is successful at it | Providing Strong Competitive Advantage |
Track Record of Leadership Team at Hartford Financial Services Group | Yes | Yes | Can't be imitated by competitors | Yes | Providing Strong Competitive Advantage |
Sales Force and Channel Management of Hartford Financial Services Group | Yes | No | Can be imitated by competitors | Still there is lot of potential to utilize the excellent sales force | Can provide Hartford Financial Services Group sustainable competitive advantage. Potential is certainly there. |
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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