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HollyFrontier 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 HollyFrontier to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for HollyFrontier? Defining Valuable in VRIO
A resource or capability is considered valuable for HollyFrontier , if it allows the
HollyFrontier to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow HollyFrontier to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for HollyFrontier.
What are Rare Resources for HollyFrontier? Defining Rare in VRIO
In an industry that HollyFrontier operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. HollyFrontier require rare resources to compete in the industry. If HollyFrontier don’t have rare resources that are required to succeed in the industry then HollyFrontier won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide HollyFrontier competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for HollyFrontier? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to HollyFrontier 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. HollyFrontier 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 HollyFrontier
What is a Organization for HollyFrontier? Defining Organization in VRIO
Even if the HollyFrontier 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 HollyFrontier 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 HollyFrontier | Yes, as it diversify the revenue streams and isolate company's balance sheet from economic cycles | Yes | Can be imitated by competitors of HollyFrontier but at a relatively high cost | Yes, it is one of the most diversified companies in its industry | Providing Strong Competitive Advantage |
Brand awareness of HollyFrontier products and services | Yes, the brand awareness of HollyFrontier products are high | Yes, HollyFrontier has one of the leading brand in the industry | No | HollyFrontier has utilized its leading brand position in various segments | Sustainable Competitive Advantage |
Successful Implementation of Digital Strategy at HollyFrontier | 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 |
Brand Positioning of HollyFrontier 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 |
Intellectual Property Rights, Copyrights, and Trademarks | Yes, they are extremely valuable for HollyFrontier to thwart competition | Yes, IPR and other rights are rare and competition of HollyFrontier 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 |
Position among Retailers and Wholesalers – HollyFrontier retail strategy | Yes, HollyFrontier has strong relationship with retailers and wholesalers | Yes, HollyFrontier has dedicated channel partners | Difficult to imitate though not impossible | Yes, over the years company has used it successfully | Sustainable Competitive Advantage |
Marketing Expertise within HollyFrontier | 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 HollyFrontier are often matched by competitors | Yes, HollyFrontier is leveraging both its inhouse marketing department and external expertise | Temporary Competitive Advantage |
Distribution and Logistics Costs Competitiveness | Yes, as it helps HollyFrontier in delivering lower costs | No | Can be imitated by competitors of HollyFrontier but it is difficult | Yes | Medium to Long Term Competitive Advantage |
Opportunities for Brand Extensions for HollyFrontier 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 |
Access to Critical Raw Material for Successful Execution | Yes | Yes, as other competitors have to come to terms with HollyFrontier 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 HollyFrontier operates in | No, none of the competitors so far has able to imitate this expertise | Yes, HollyFrontier is successful at it | Providing Strong Competitive Advantage |
Product Portfolio and Synergy among Various Product Lines of HollyFrontier | 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 |
Access to Cheap Capital for HollyFrontier | Yes, as a leading player in the industry and current macro economic conditions, HollyFrontier has access to cheap capital | No | Can be imitated by the competitors of HollyFrontier | Not been totally exploited | Not significant in creating competitive advantage |
Pricing Strategies of HollyFrontier | Yes, HollyFrontier has sound pricing strategies | No | Pricing strategies are regularly imitated in the industry | Yes, firm has a pricing analytics engine | It can only provide HollyFrontier with a Temporary Competitive Advantage |
HollyFrontier 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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