Asbury Automotive Group 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 Asbury Automotive Group to do better resource allocation and build a defensible value and supply chain.

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What is a Valuable Resource for Asbury Automotive Group? Defining Valuable in VRIO

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

What are Rare Resources for Asbury Automotive Group? Defining Rare in VRIO

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

What is a Inimitable (Difficult to Immitate) Resource for Asbury Automotive Group? Defining Inimitable in VRIO

A valuable and rare resource can provide a competitive advantage to Asbury Automotive Group 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. Asbury Automotive Group 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 Asbury Automotive Group

What is a Organization for Asbury Automotive Group? Defining Organization in VRIO

Even if the Asbury Automotive Group 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 Asbury Automotive Group 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
Opportunities in the E-Commerce Space for Asbury Automotive Group - using Present IT Capabilities	Yes, the e-commerce space is rapidly growing and Asbury Automotive Group 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
Talent to Manage Regulatory and Legal Obligations	Yes	No	Can be imitated by competitors	Yes	Not critical factor
Position among Retailers and Wholesalers – Asbury Automotive Group retail strategy	Yes, Asbury Automotive Group has strong relationship with retailers and wholesalers	Yes, Asbury Automotive Group 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 Asbury Automotive Group operates in	No, none of the competitors so far has able to imitate this expertise	Yes, Asbury Automotive Group is successful at it	Providing Strong Competitive Advantage
Successful Implementation of Digital Strategy at Asbury Automotive Group	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
Distribution and Logistics Costs Competitiveness	Yes, as it helps Asbury Automotive Group in delivering lower costs	No	Can be imitated by competitors of Asbury Automotive Group but it is difficult	Yes	Medium to Long Term Competitive Advantage
Access to Cheap Capital for Asbury Automotive Group	Yes, as a leading player in the industry and current macro economic conditions, Asbury Automotive Group has access to cheap capital	No	Can be imitated by the competitors of Asbury Automotive Group	Not been totally exploited	Not significant in creating competitive advantage
Customer Community of Asbury Automotive Group	Yes, as customers are co-creating products	Yes, the Asbury Automotive Group has able to build a special relationship with its customers	It is very difficult for Asbury Automotive Group competitors to imitate the culture and community dedication	Going by the data, there is still a lot of upside in building on Asbury Automotive Group customers community ecosystem	Providing Strong Competitive Advantage
Product Portfolio and Synergy among Various Product Lines of Asbury Automotive Group	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
Sales Force and Channel Management of Asbury Automotive Group	Yes	No	Can be imitated by competitors	Still there is lot of potential to utilize the excellent sales force	Can provide Asbury Automotive Group sustainable competitive advantage. Potential is certainly there.
Pricing Strategies of Asbury Automotive Group	Yes, Asbury Automotive Group has sound pricing strategies	No	Pricing strategies are regularly imitated in the industry	Yes, firm has a pricing analytics engine	It can only provide Asbury Automotive Group with a Temporary Competitive Advantage
Marketing Expertise within Asbury Automotive Group	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 Asbury Automotive Group are often matched by competitors	Yes, Asbury Automotive Group is leveraging both its inhouse marketing department and external expertise	Temporary Competitive Advantage
Asbury Automotive Group 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 Asbury Automotive Group	Asbury Automotive Group is leveraging the customer loyalty to good effect	Provide Asbury Automotive Group medium term competitive advantage
Opportunities in the Adjacent Industries that Asbury Automotive Group 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

Asbury Automotive Group SWOT Analysis, SWOT Matrix, Weighted SWOT Case Study Solution & Analysis

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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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