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CMS Energy 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 CMS Energy to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for CMS Energy? Defining Valuable in VRIO
A resource or capability is considered valuable for CMS Energy , if it allows the
CMS Energy to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow CMS Energy to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for CMS Energy.
What are Rare Resources for CMS Energy? Defining Rare in VRIO
In an industry that CMS Energy operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. CMS Energy require rare resources to compete in the industry. If CMS Energy don’t have rare resources that are required to succeed in the industry then CMS Energy won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide CMS Energy competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for CMS Energy? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to CMS Energy 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. CMS Energy 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 CMS Energy
What is a Organization for CMS Energy? Defining Organization in VRIO
Even if the CMS Energy 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 CMS Energy 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 |
---|---|---|---|---|---|
Successful Implementation of Digital Strategy at CMS Energy | 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 |
Supply Chain Network Flexibility of CMS Energy | Yes | Yes | Near competitors also have flexible supply chain and share some of the suppliers | Fully utilized by CMS Energy organizational structure and capabilities | Keeps the business running |
Distribution and Logistics Costs Competitiveness | Yes, as it helps CMS Energy in delivering lower costs | No | Can be imitated by competitors of CMS Energy but it is difficult | Yes | Medium to Long Term Competitive Advantage |
Track Record of Leadership Team at CMS Energy | Yes | Yes | Can't be imitated by competitors | Yes | Providing Strong Competitive Advantage |
Opportunities in the Adjacent Industries that CMS Energy 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 |
Position among Retailers and Wholesalers – CMS Energy retail strategy | Yes, CMS Energy has strong relationship with retailers and wholesalers | Yes, CMS Energy has dedicated channel partners | Difficult to imitate though not impossible | Yes, over the years company has used it successfully | Sustainable Competitive Advantage |
Ability to Attract Talent in Various Local & Global Markets | Yes, CMS Energy 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 CMS Energy | To a large extent yes | Providing Strong Competitive Advantage |
Brand awareness of CMS Energy products and services | Yes, the brand awareness of CMS Energy products are high | Yes, CMS Energy has one of the leading brand in the industry | No | CMS Energy has utilized its leading brand position in various segments | Sustainable Competitive Advantage |
Intellectual Property Rights, Copyrights, and Trademarks | Yes, they are extremely valuable for CMS Energy to thwart competition | Yes, IPR and other rights are rare and competition of CMS Energy 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 |
Track Record of Project Execution | Yes, especially in an industry where there are frequent cost overun | Yes, especially in the segment that CMS Energy operates in | No, none of the competitors so far has able to imitate this expertise | Yes, CMS Energy is successful at it | Providing Strong Competitive Advantage |
Vision of the Leadership for Next Set of Challenges | Yes | No | Can't be imitated by competitors of CMS Energy | Not based on information provided in the case | Can Lead to Strong Competitive Advantage |
Product Portfolio and Synergy among Various Product Lines of CMS Energy | 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 |
Brand Positioning of CMS Energy 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 |
Access to Cheap Capital for CMS Energy | Yes, as a leading player in the industry and current macro economic conditions, CMS Energy has access to cheap capital | No | Can be imitated by the competitors of CMS Energy | Not been totally exploited | Not significant in creating competitive advantage |
CMS Energy 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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