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

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What is a Valuable Resource for Yum Brands? Defining Valuable in VRIO

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

What are Rare Resources for Yum Brands? Defining Rare in VRIO

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

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

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

What is a Organization for Yum Brands? Defining Organization in VRIO

Even if the Yum Brands 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 Yum Brands 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 Yum Brands	Yes, as it diversify the revenue streams and isolate company's balance sheet from economic cycles	Yes	Can be imitated by competitors of Yum Brands but at a relatively high cost	Yes, it is one of the most diversified companies in its industry	Providing Strong Competitive Advantage
Sales Force and Channel Management of Yum Brands	Yes	No	Can be imitated by competitors	Still there is lot of potential to utilize the excellent sales force	Can provide Yum Brands sustainable competitive advantage. Potential is certainly there.
Opportunities in the Adjacent Industries that Yum Brands 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
Alignment of Activities with Yum Brands 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
Access to Critical Raw Material for Successful Execution	Yes	Yes, as other competitors have to come to terms with Yum Brands dominant market position	Can be imitated by competitors	Yes	Providing Sustainable Competitive Advantage
Pricing Strategies of Yum Brands	Yes, Yum Brands has sound pricing strategies	No	Pricing strategies are regularly imitated in the industry	Yes, firm has a pricing analytics engine	It can only provide Yum Brands with a Temporary Competitive Advantage
Brand awareness of Yum Brands products and services	Yes, the brand awareness of Yum Brands products are high	Yes, Yum Brands has one of the leading brand in the industry	No	Yum Brands has utilized its leading brand position in various segments	Sustainable Competitive Advantage
Ability to Attract Talent in Various Local & Global Markets	Yes, Yum Brands 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 Yum Brands	To a large extent yes	Providing Strong Competitive Advantage
Track Record of Leadership Team at Yum Brands	Yes	Yes	Can't be imitated by competitors	Yes	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 Yum Brands operates in	No, none of the competitors so far has able to imitate this expertise	Yes, Yum Brands is successful at it	Providing Strong Competitive Advantage
Yum Brands 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 Yum Brands	Yum Brands is leveraging the customer loyalty to good effect	Provide Yum Brands medium term competitive advantage
Intellectual Property Rights, Copyrights, and Trademarks	Yes, they are extremely valuable for Yum Brands to thwart competition	Yes, IPR and other rights are rare and competition of Yum Brands 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 – Yum Brands retail strategy	Yes, Yum Brands has strong relationship with retailers and wholesalers	Yes, Yum Brands has dedicated channel partners	Difficult to imitate though not impossible	Yes, over the years company has used it successfully	Sustainable Competitive Advantage
Successful Implementation of Digital Strategy at Yum Brands	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

Yum Brands 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