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Cognizant Technology Solutions 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 Cognizant Technology Solutions to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for Cognizant Technology Solutions? Defining Valuable in VRIO
A resource or capability is considered valuable for Cognizant Technology Solutions , if it allows the
Cognizant Technology Solutions to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow Cognizant Technology Solutions to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for Cognizant Technology Solutions.
What are Rare Resources for Cognizant Technology Solutions? Defining Rare in VRIO
In an industry that Cognizant Technology Solutions operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. Cognizant Technology Solutions require rare resources to compete in the industry. If Cognizant Technology Solutions don’t have rare resources that are required to succeed in the industry then Cognizant Technology Solutions won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide Cognizant Technology Solutions competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for Cognizant Technology Solutions? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to Cognizant Technology Solutions 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. Cognizant Technology Solutions 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 Cognizant Technology Solutions
What is a Organization for Cognizant Technology Solutions? Defining Organization in VRIO
Even if the Cognizant Technology Solutions 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 Cognizant Technology Solutions 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 |
---|---|---|---|---|---|
Alignment of Activities with Cognizant Technology Solutions 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 Cognizant Technology Solutions dominant market position | Can be imitated by competitors | Yes | Providing Sustainable Competitive Advantage |
Supply Chain Network Flexibility of Cognizant Technology Solutions | Yes | Yes | Near competitors also have flexible supply chain and share some of the suppliers | Fully utilized by Cognizant Technology Solutions organizational structure and capabilities | Keeps the business running |
Track Record of Leadership Team at Cognizant Technology Solutions | Yes | Yes | Can't be imitated by competitors | Yes | Providing Strong Competitive Advantage |
Pricing Strategies of Cognizant Technology Solutions | Yes, Cognizant Technology Solutions has sound pricing strategies | No | Pricing strategies are regularly imitated in the industry | Yes, firm has a pricing analytics engine | It can only provide Cognizant Technology Solutions with a Temporary Competitive Advantage |
Financial Resources of Cognizant Technology Solutions | Yes | No | Financial instruments and market liquidity are available to all the nearest competitors | Cognizant Technology Solutions has reasonably sound financial position | Cognizant Technology Solutions has relatively sustainable Competitive Advantage |
Opportunities in the Adjacent Industries that Cognizant Technology Solutions 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 |
Global and Local Presence of Cognizant Technology Solutions | Yes, as it diversify the revenue streams and isolate company's balance sheet from economic cycles | Yes | Can be imitated by competitors of Cognizant Technology Solutions but at a relatively high cost | Yes, it is one of the most diversified companies in its industry | Providing Strong Competitive Advantage |
Opportunities in the E-Commerce Space for Cognizant Technology Solutions - using Present IT Capabilities | Yes, the e-commerce space is rapidly growing and Cognizant Technology Solutions 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 |
Access to Cheap Capital for Cognizant Technology Solutions | Yes, as a leading player in the industry and current macro economic conditions, Cognizant Technology Solutions has access to cheap capital | No | Can be imitated by the competitors of Cognizant Technology Solutions | Not been totally exploited | Not significant in creating competitive advantage |
Marketing Expertise within Cognizant Technology Solutions | 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 Cognizant Technology Solutions are often matched by competitors | Yes, Cognizant Technology Solutions is leveraging both its inhouse marketing department and external expertise | Temporary Competitive Advantage |
Brand awareness of Cognizant Technology Solutions products and services | Yes, the brand awareness of Cognizant Technology Solutions products are high | Yes, Cognizant Technology Solutions has one of the leading brand in the industry | No | Cognizant Technology Solutions has utilized its leading brand position in various segments | Sustainable Competitive Advantage |
Sales Force and Channel Management of Cognizant Technology Solutions | Yes | No | Can be imitated by competitors | Still there is lot of potential to utilize the excellent sales force | Can provide Cognizant Technology Solutions sustainable competitive advantage. Potential is certainly there. |
Vision of the Leadership for Next Set of Challenges | Yes | No | Can't be imitated by competitors of Cognizant Technology Solutions | Not based on information provided in the case | Can Lead to Strong Competitive Advantage |
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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