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

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What is a Valuable Resource for Gap? Defining Valuable in VRIO

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

What are Rare Resources for Gap? Defining Rare in VRIO

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

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

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

What is a Organization for Gap? Defining Organization in VRIO

Even if the Gap 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 Gap 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
Global and Local Presence of Gap	Yes, as it diversify the revenue streams and isolate company's balance sheet from economic cycles	Yes	Can be imitated by competitors of Gap but at a relatively high cost	Yes, it is one of the most diversified companies in its industry	Providing Strong Competitive Advantage
Supply Chain Network Flexibility of Gap	Yes	Yes	Near competitors also have flexible supply chain and share some of the suppliers	Fully utilized by Gap organizational structure and capabilities	Keeps the business running
Pricing Strategies of Gap	Yes, Gap has sound pricing strategies	No	Pricing strategies are regularly imitated in the industry	Yes, firm has a pricing analytics engine	It can only provide Gap with a Temporary Competitive Advantage
Marketing Expertise within Gap	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 Gap are often matched by competitors	Yes, Gap is leveraging both its inhouse marketing department and external expertise	Temporary Competitive Advantage
Successful Implementation of Digital Strategy at Gap	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
Vision of the Leadership for Next Set of Challenges	Yes	No	Can't be imitated by competitors of Gap	Not based on information provided in the case	Can Lead to Strong Competitive Advantage
Intellectual Property Rights, Copyrights, and Trademarks	Yes, they are extremely valuable for Gap to thwart competition	Yes, IPR and other rights are rare and competition of Gap 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
Brand awareness of Gap products and services	Yes, the brand awareness of Gap products are high	Yes, Gap has one of the leading brand in the industry	No	Gap has utilized its leading brand position in various segments	Sustainable Competitive Advantage
Track Record of Leadership Team at Gap	Yes	Yes	Can't be imitated by competitors	Yes	Providing Strong Competitive Advantage
Customer Community of Gap	Yes, as customers are co-creating products	Yes, the Gap has able to build a special relationship with its customers	It is very difficult for Gap competitors to imitate the culture and community dedication	Going by the data, there is still a lot of upside in building on Gap customers community ecosystem	Providing Strong Competitive Advantage
Track Record of Project Execution	Yes, especially in an industry where there are frequent cost overun	Yes, especially in the segment that Gap operates in	No, none of the competitors so far has able to imitate this expertise	Yes, Gap is successful at it	Providing Strong Competitive Advantage
Opportunities in the Adjacent Industries that Gap 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 Gap 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
Alignment of Activities with Gap 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

Gap 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