Hertz Global Holdings 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 Hertz Global Holdings to do better resource allocation and build a defensible value and supply chain.

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What is a Valuable Resource for Hertz Global Holdings? Defining Valuable in VRIO

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

What are Rare Resources for Hertz Global Holdings? Defining Rare in VRIO

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

What is a Inimitable (Difficult to Immitate) Resource for Hertz Global Holdings? Defining Inimitable in VRIO

A valuable and rare resource can provide a competitive advantage to Hertz Global Holdings 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. Hertz Global Holdings 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 Hertz Global Holdings

What is a Organization for Hertz Global Holdings? Defining Organization in VRIO

Even if the Hertz Global Holdings 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 Hertz Global Holdings 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
Distribution and Logistics Costs Competitiveness	Yes, as it helps Hertz Global Holdings in delivering lower costs	No	Can be imitated by competitors of Hertz Global Holdings but it is difficult	Yes	Medium to Long Term Competitive Advantage
Track Record of Leadership Team at Hertz Global Holdings	Yes	Yes	Can't be imitated by competitors	Yes	Providing Strong Competitive Advantage
Customer Community of Hertz Global Holdings	Yes, as customers are co-creating products	Yes, the Hertz Global Holdings has able to build a special relationship with its customers	It is very difficult for Hertz Global Holdings competitors to imitate the culture and community dedication	Going by the data, there is still a lot of upside in building on Hertz Global Holdings 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 Hertz Global Holdings operates in	No, none of the competitors so far has able to imitate this expertise	Yes, Hertz Global Holdings is successful at it	Providing Strong Competitive Advantage
Financial Resources of Hertz Global Holdings	Yes	No	Financial instruments and market liquidity are available to all the nearest competitors	Hertz Global Holdings has reasonably sound financial position	Hertz Global Holdings has relatively sustainable Competitive Advantage
Opportunities for Brand Extensions for Hertz Global Holdings 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
Intellectual Property Rights, Copyrights, and Trademarks	Yes, they are extremely valuable for Hertz Global Holdings to thwart competition	Yes, IPR and other rights are rare and competition of Hertz Global Holdings 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
Hertz Global Holdings 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 Hertz Global Holdings	Hertz Global Holdings is leveraging the customer loyalty to good effect	Provide Hertz Global Holdings medium term competitive advantage
Ability to Attract Talent in Various Local & Global Markets	Yes, Hertz Global Holdings 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 Hertz Global Holdings	To a large extent yes	Providing Strong Competitive Advantage
Pricing Strategies of Hertz Global Holdings	Yes, Hertz Global Holdings has sound pricing strategies	No	Pricing strategies are regularly imitated in the industry	Yes, firm has a pricing analytics engine	It can only provide Hertz Global Holdings with a Temporary Competitive Advantage
Successful Implementation of Digital Strategy at Hertz Global Holdings	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
Talent to Manage Regulatory and Legal Obligations	Yes	No	Can be imitated by competitors	Yes	Not critical factor
Brand awareness of Hertz Global Holdings products and services	Yes, the brand awareness of Hertz Global Holdings products are high	Yes, Hertz Global Holdings has one of the leading brand in the industry	No	Hertz Global Holdings has utilized its leading brand position in various segments	Sustainable Competitive Advantage
Access to Critical Raw Material for Successful Execution	Yes	Yes, as other competitors have to come to terms with Hertz Global Holdings dominant market position	Can be imitated by competitors	Yes	Providing Sustainable Competitive Advantage

Hertz Global Holdings 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