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PPL 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 PPL to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for PPL? Defining Valuable in VRIO
A resource or capability is considered valuable for PPL , if it allows the
PPL to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow PPL to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for PPL.
What are Rare Resources for PPL? Defining Rare in VRIO
In an industry that PPL operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. PPL require rare resources to compete in the industry. If PPL don’t have rare resources that are required to succeed in the industry then PPL won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide PPL competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for PPL? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to PPL 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. PPL 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 PPL
What is a Organization for PPL? Defining Organization in VRIO
Even if the PPL 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 PPL 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 |
---|---|---|---|---|---|
Access to Critical Raw Material for Successful Execution | Yes | Yes, as other competitors have to come to terms with PPL dominant market position | Can be imitated by competitors | Yes | Providing Sustainable Competitive Advantage |
Opportunities for Brand Extensions for PPL 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 |
Successful Implementation of Digital Strategy at PPL | 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 |
Opportunities in the E-Commerce Space for PPL - using Present IT Capabilities | Yes, the e-commerce space is rapidly growing and PPL 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 |
Distribution and Logistics Costs Competitiveness | Yes, as it helps PPL in delivering lower costs | No | Can be imitated by competitors of PPL but it is difficult | Yes | Medium to Long Term Competitive Advantage |
Access to Cheap Capital for PPL | Yes, as a leading player in the industry and current macro economic conditions, PPL has access to cheap capital | No | Can be imitated by the competitors of PPL | Not been totally exploited | Not significant in creating competitive advantage |
Alignment of Activities with PPL 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 PPL | Yes, as it diversify the revenue streams and isolate company's balance sheet from economic cycles | Yes | Can be imitated by competitors of PPL but at a relatively high cost | Yes, it is one of the most diversified companies in its industry | Providing Strong Competitive Advantage |
PPL 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 PPL | PPL is leveraging the customer loyalty to good effect | Provide PPL medium term competitive advantage |
Opportunities in the Adjacent Industries that PPL 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 |
Brand awareness of PPL products and services | Yes, the brand awareness of PPL products are high | Yes, PPL has one of the leading brand in the industry | No | PPL has utilized its leading brand position in various segments | Sustainable Competitive Advantage |
Intellectual Property Rights, Copyrights, and Trademarks | Yes, they are extremely valuable for PPL to thwart competition | Yes, IPR and other rights are rare and competition of PPL 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 |
Ability to Attract Talent in Various Local & Global Markets | Yes, PPL 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 PPL | To a large extent yes | Providing Strong Competitive Advantage |
PPL 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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