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

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What is a Valuable Resource for Western Refining? Defining Valuable in VRIO

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

What are Rare Resources for Western Refining? Defining Rare in VRIO

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

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

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

What is a Organization for Western Refining? Defining Organization in VRIO

Even if the Western Refining 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 Western Refining 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
Customer Community of Western Refining	Yes, as customers are co-creating products	Yes, the Western Refining has able to build a special relationship with its customers	It is very difficult for Western Refining competitors to imitate the culture and community dedication	Going by the data, there is still a lot of upside in building on Western Refining customers community ecosystem	Providing Strong Competitive Advantage
Marketing Expertise within Western Refining	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 Western Refining are often matched by competitors	Yes, Western Refining is leveraging both its inhouse marketing department and external expertise	Temporary Competitive Advantage
Access to Critical Raw Material for Successful Execution	Yes	Yes, as other competitors have to come to terms with Western Refining dominant market position	Can be imitated by competitors	Yes	Providing Sustainable Competitive Advantage
Track Record of Leadership Team at Western Refining	Yes	Yes	Can't be imitated by competitors	Yes	Providing Strong Competitive Advantage
Access to Cheap Capital for Western Refining	Yes, as a leading player in the industry and current macro economic conditions, Western Refining has access to cheap capital	No	Can be imitated by the competitors of Western Refining	Not been totally exploited	Not significant in creating competitive advantage
Talent to Manage Regulatory and Legal Obligations	Yes	No	Can be imitated by competitors	Yes	Not critical factor
Intellectual Property Rights, Copyrights, and Trademarks	Yes, they are extremely valuable for Western Refining to thwart competition	Yes, IPR and other rights are rare and competition of Western Refining 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
Western Refining 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 Western Refining	Western Refining is leveraging the customer loyalty to good effect	Provide Western Refining medium term competitive advantage
Financial Resources of Western Refining	Yes	No	Financial instruments and market liquidity are available to all the nearest competitors	Western Refining has reasonably sound financial position	Western Refining has relatively 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 Western Refining operates in	No, none of the competitors so far has able to imitate this expertise	Yes, Western Refining is successful at it	Providing Strong Competitive Advantage
Brand Positioning of Western Refining 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 Western Refining 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
Opportunities in the E-Commerce Space for Western Refining - using Present IT Capabilities	Yes, the e-commerce space is rapidly growing and Western Refining 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
Global and Local Presence of Western Refining	Yes, as it diversify the revenue streams and isolate company's balance sheet from economic cycles	Yes	Can be imitated by competitors of Western Refining but at a relatively high cost	Yes, it is one of the most diversified companies in its industry	Providing Strong Competitive Advantage

Western Refining 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