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Autoliv 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 Autoliv to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for Autoliv? Defining Valuable in VRIO
A resource or capability is considered valuable for Autoliv , if it allows the
Autoliv to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow Autoliv to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for Autoliv.
What are Rare Resources for Autoliv? Defining Rare in VRIO
In an industry that Autoliv operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. Autoliv require rare resources to compete in the industry. If Autoliv don’t have rare resources that are required to succeed in the industry then Autoliv won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide Autoliv competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for Autoliv? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to Autoliv 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. Autoliv 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 Autoliv
What is a Organization for Autoliv? Defining Organization in VRIO
Even if the Autoliv 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 Autoliv 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 |
---|---|---|---|---|---|
Financial Resources of Autoliv | Yes | No | Financial instruments and market liquidity are available to all the nearest competitors | Autoliv has reasonably sound financial position | Autoliv has relatively sustainable Competitive Advantage |
Customer Community of Autoliv | Yes, as customers are co-creating products | Yes, the Autoliv has able to build a special relationship with its customers | It is very difficult for Autoliv competitors to imitate the culture and community dedication | Going by the data, there is still a lot of upside in building on Autoliv customers community ecosystem | Providing Strong Competitive Advantage |
Marketing Expertise within Autoliv | 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 Autoliv are often matched by competitors | Yes, Autoliv is leveraging both its inhouse marketing department and external expertise | Temporary Competitive Advantage |
Intellectual Property Rights, Copyrights, and Trademarks | Yes, they are extremely valuable for Autoliv to thwart competition | Yes, IPR and other rights are rare and competition of Autoliv 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 |
Brand Positioning of Autoliv 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 |
Position among Retailers and Wholesalers – Autoliv retail strategy | Yes, Autoliv has strong relationship with retailers and wholesalers | Yes, Autoliv has dedicated channel partners | Difficult to imitate though not impossible | Yes, over the years company has used it successfully | 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 Autoliv operates in | No, none of the competitors so far has able to imitate this expertise | Yes, Autoliv is successful at it | Providing Strong Competitive Advantage |
Track Record of Leadership Team at Autoliv | Yes | Yes | Can't be imitated by competitors | Yes | Providing Strong Competitive Advantage |
Successful Implementation of Digital Strategy at Autoliv | 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 awareness of Autoliv products and services | Yes, the brand awareness of Autoliv products are high | Yes, Autoliv has one of the leading brand in the industry | No | Autoliv has utilized its leading brand position in various segments | Sustainable Competitive Advantage |
Access to Cheap Capital for Autoliv | Yes, as a leading player in the industry and current macro economic conditions, Autoliv has access to cheap capital | No | Can be imitated by the competitors of Autoliv | Not been totally exploited | Not significant in creating competitive advantage |
Opportunities for Brand Extensions for Autoliv 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 Autoliv dominant market position | Can be imitated by competitors | Yes | Providing Sustainable Competitive Advantage |
Pricing Strategies of Autoliv | Yes, Autoliv has sound pricing strategies | No | Pricing strategies are regularly imitated in the industry | Yes, firm has a pricing analytics engine | It can only provide Autoliv with a Temporary Competitive Advantage |
Autoliv 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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