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PulteGroup 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 PulteGroup to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for PulteGroup? Defining Valuable in VRIO
A resource or capability is considered valuable for PulteGroup , if it allows the
PulteGroup to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow PulteGroup to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for PulteGroup.
What are Rare Resources for PulteGroup? Defining Rare in VRIO
In an industry that PulteGroup operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. PulteGroup require rare resources to compete in the industry. If PulteGroup don’t have rare resources that are required to succeed in the industry then PulteGroup won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide PulteGroup competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for PulteGroup? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to PulteGroup 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. PulteGroup 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 PulteGroup
What is a Organization for PulteGroup? Defining Organization in VRIO
Even if the PulteGroup 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 PulteGroup 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 Adjacent Industries that PulteGroup 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 |
Marketing Expertise within PulteGroup | 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 PulteGroup are often matched by competitors | Yes, PulteGroup is leveraging both its inhouse marketing department and external expertise | Temporary Competitive Advantage |
Opportunities for Brand Extensions for PulteGroup 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 |
Vision of the Leadership for Next Set of Challenges | Yes | No | Can't be imitated by competitors of PulteGroup | Not based on information provided in the case | Can Lead to Strong Competitive Advantage |
Distribution and Logistics Costs Competitiveness | Yes, as it helps PulteGroup in delivering lower costs | No | Can be imitated by competitors of PulteGroup but it is difficult | Yes | Medium to Long Term Competitive Advantage |
Access to Critical Raw Material for Successful Execution | Yes | Yes, as other competitors have to come to terms with PulteGroup dominant market position | Can be imitated by competitors | Yes | Providing Sustainable Competitive Advantage |
Position among Retailers and Wholesalers – PulteGroup retail strategy | Yes, PulteGroup has strong relationship with retailers and wholesalers | Yes, PulteGroup has dedicated channel partners | Difficult to imitate though not impossible | Yes, over the years company has used it successfully | Sustainable Competitive Advantage |
Access to Cheap Capital for PulteGroup | Yes, as a leading player in the industry and current macro economic conditions, PulteGroup has access to cheap capital | No | Can be imitated by the competitors of PulteGroup | Not been totally exploited | Not significant in creating competitive advantage |
Brand Positioning of PulteGroup 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 |
Sales Force and Channel Management of PulteGroup | Yes | No | Can be imitated by competitors | Still there is lot of potential to utilize the excellent sales force | Can provide PulteGroup sustainable competitive advantage. Potential is certainly there. |
Track Record of Project Execution | Yes, especially in an industry where there are frequent cost overun | Yes, especially in the segment that PulteGroup operates in | No, none of the competitors so far has able to imitate this expertise | Yes, PulteGroup is successful at it | Providing Strong Competitive Advantage |
Customer Community of PulteGroup | Yes, as customers are co-creating products | Yes, the PulteGroup has able to build a special relationship with its customers | It is very difficult for PulteGroup competitors to imitate the culture and community dedication | Going by the data, there is still a lot of upside in building on PulteGroup customers community ecosystem | Providing Strong Competitive Advantage |
Supply Chain Network Flexibility of PulteGroup | Yes | Yes | Near competitors also have flexible supply chain and share some of the suppliers | Fully utilized by PulteGroup organizational structure and capabilities | Keeps the business running |
Product Portfolio and Synergy among Various Product Lines of PulteGroup | 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 |
PulteGroup 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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