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Laboratory Corp. of America 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 Laboratory Corp. of America to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for Laboratory Corp. of America? Defining Valuable in VRIO
A resource or capability is considered valuable for Laboratory Corp. of America , if it allows the
Laboratory Corp. of America to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow Laboratory Corp. of America to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for Laboratory Corp. of America.
What are Rare Resources for Laboratory Corp. of America? Defining Rare in VRIO
In an industry that Laboratory Corp. of America operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. Laboratory Corp. of America require rare resources to compete in the industry. If Laboratory Corp. of America don’t have rare resources that are required to succeed in the industry then Laboratory Corp. of America won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide Laboratory Corp. of America competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for Laboratory Corp. of America? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to Laboratory Corp. of America 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. Laboratory Corp. of America 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 Laboratory Corp. of America
What is a Organization for Laboratory Corp. of America? Defining Organization in VRIO
Even if the Laboratory Corp. of America 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 Laboratory Corp. of America 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 |
---|---|---|---|---|---|
Sales Force and Channel Management of Laboratory Corp. of America | Yes | No | Can be imitated by competitors | Still there is lot of potential to utilize the excellent sales force | Can provide Laboratory Corp. of America sustainable competitive advantage. Potential is certainly there. |
Financial Resources of Laboratory Corp. of America | Yes | No | Financial instruments and market liquidity are available to all the nearest competitors | Laboratory Corp. of America has reasonably sound financial position | Laboratory Corp. of America has relatively sustainable Competitive Advantage |
Distribution and Logistics Costs Competitiveness | Yes, as it helps Laboratory Corp. of America in delivering lower costs | No | Can be imitated by competitors of Laboratory Corp. of America but it is difficult | Yes | Medium to Long Term Competitive Advantage |
Pricing Strategies of Laboratory Corp. of America | Yes, Laboratory Corp. of America has sound pricing strategies | No | Pricing strategies are regularly imitated in the industry | Yes, firm has a pricing analytics engine | It can only provide Laboratory Corp. of America with a Temporary Competitive Advantage |
Intellectual Property Rights, Copyrights, and Trademarks | Yes, they are extremely valuable for Laboratory Corp. of America to thwart competition | Yes, IPR and other rights are rare and competition of Laboratory Corp. of America 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 |
Opportunities in the Adjacent Industries that Laboratory Corp. of America 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 |
Access to Cheap Capital for Laboratory Corp. of America | Yes, as a leading player in the industry and current macro economic conditions, Laboratory Corp. of America has access to cheap capital | No | Can be imitated by the competitors of Laboratory Corp. of America | Not been totally exploited | Not significant in creating competitive advantage |
Marketing Expertise within Laboratory Corp. of America | 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 Laboratory Corp. of America are often matched by competitors | Yes, Laboratory Corp. of America is leveraging both its inhouse marketing department and external expertise | Temporary Competitive Advantage |
Alignment of Activities with Laboratory Corp. of America 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 |
Talent to Manage Regulatory and Legal Obligations | Yes | No | Can be imitated by competitors | Yes | Not critical factor |
Global and Local Presence of Laboratory Corp. of America | Yes, as it diversify the revenue streams and isolate company's balance sheet from economic cycles | Yes | Can be imitated by competitors of Laboratory Corp. of America but at a relatively high cost | Yes, it is one of the most diversified companies in its industry | Providing Strong Competitive Advantage |
Product Portfolio and Synergy among Various Product Lines of Laboratory Corp. of America | Yes, it is valuable in the industry given the various segmentations & consumer preferences. | Most of the competitors are trying to enter the lucrative segments | Can be imitated by the competitors | The firm has used it to good effect, details can be found in case exhibit | Provide short term competitive advantage but requires constant innovation to sustain |
Laboratory Corp. of America 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 Laboratory Corp. of America | Laboratory Corp. of America is leveraging the customer loyalty to good effect | Provide Laboratory Corp. of America medium term competitive advantage |
Supply Chain Network Flexibility of Laboratory Corp. of America | Yes | Yes | Near competitors also have flexible supply chain and share some of the suppliers | Fully utilized by Laboratory Corp. of America organizational structure and capabilities | Keeps the business running |
Laboratory Corp. of America 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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