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Fannie Mae 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 Fannie Mae to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for Fannie Mae? Defining Valuable in VRIO
A resource or capability is considered valuable for Fannie Mae , if it allows the
Fannie Mae to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow Fannie Mae to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for Fannie Mae.
What are Rare Resources for Fannie Mae? Defining Rare in VRIO
In an industry that Fannie Mae operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. Fannie Mae require rare resources to compete in the industry. If Fannie Mae don’t have rare resources that are required to succeed in the industry then Fannie Mae won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide Fannie Mae competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for Fannie Mae? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to Fannie Mae 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. Fannie Mae 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 Fannie Mae
What is a Organization for Fannie Mae? Defining Organization in VRIO
Even if the Fannie Mae 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 Fannie Mae 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 Leadership Team at Fannie Mae | Yes | Yes | Can't be imitated by competitors | Yes | Providing Strong Competitive Advantage |
Vision of the Leadership for Next Set of Challenges | Yes | No | Can't be imitated by competitors of Fannie Mae | Not based on information provided in the case | Can Lead to Strong Competitive Advantage |
Opportunities for Brand Extensions for Fannie Mae 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 |
Global and Local Presence of Fannie Mae | Yes, as it diversify the revenue streams and isolate company's balance sheet from economic cycles | Yes | Can be imitated by competitors of Fannie Mae but at a relatively high cost | Yes, it is one of the most diversified companies in its industry | Providing Strong Competitive Advantage |
Alignment of Activities with Fannie Mae 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 |
Successful Implementation of Digital Strategy at Fannie Mae | 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 |
Supply Chain Network Flexibility of Fannie Mae | Yes | Yes | Near competitors also have flexible supply chain and share some of the suppliers | Fully utilized by Fannie Mae organizational structure and capabilities | Keeps the business running |
Sales Force and Channel Management of Fannie Mae | Yes | No | Can be imitated by competitors | Still there is lot of potential to utilize the excellent sales force | Can provide Fannie Mae sustainable competitive advantage. Potential is certainly there. |
Ability to Attract Talent in Various Local & Global Markets | Yes, Fannie Mae 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 Fannie Mae | To a large extent yes | Providing Strong Competitive Advantage |
Pricing Strategies of Fannie Mae | Yes, Fannie Mae has sound pricing strategies | No | Pricing strategies are regularly imitated in the industry | Yes, firm has a pricing analytics engine | It can only provide Fannie Mae with a Temporary Competitive Advantage |
Position among Retailers and Wholesalers – Fannie Mae retail strategy | Yes, Fannie Mae has strong relationship with retailers and wholesalers | Yes, Fannie Mae has dedicated channel partners | Difficult to imitate though not impossible | Yes, over the years company has used it successfully | Sustainable Competitive Advantage |
Opportunities in the E-Commerce Space for Fannie Mae - using Present IT Capabilities | Yes, the e-commerce space is rapidly growing and Fannie Mae 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 |
Talent to Manage Regulatory and Legal Obligations | Yes | No | Can be imitated by competitors | Yes | Not critical factor |
Product Portfolio and Synergy among Various Product Lines of Fannie Mae | 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 |
Fannie Mae 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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