United Rentals 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 United Rentals to do better resource allocation and build a defensible value and supply chain.

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What is a Valuable Resource for United Rentals? Defining Valuable in VRIO

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

What are Rare Resources for United Rentals? Defining Rare in VRIO

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

What is a Inimitable (Difficult to Immitate) Resource for United Rentals? Defining Inimitable in VRIO

A valuable and rare resource can provide a competitive advantage to United Rentals 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. United Rentals 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 United Rentals

What is a Organization for United Rentals? Defining Organization in VRIO

Even if the United Rentals 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 United Rentals 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
Supply Chain Network Flexibility of United Rentals	Yes	Yes	Near competitors also have flexible supply chain and share some of the suppliers	Fully utilized by United Rentals organizational structure and capabilities	Keeps the business running
Pricing Strategies of United Rentals	Yes, United Rentals has sound pricing strategies	No	Pricing strategies are regularly imitated in the industry	Yes, firm has a pricing analytics engine	It can only provide United Rentals with a Temporary Competitive Advantage
Product Portfolio and Synergy among Various Product Lines of United Rentals	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
Track Record of Leadership Team at United Rentals	Yes	Yes	Can't be imitated by competitors	Yes	Providing Strong Competitive Advantage
Opportunities in the Adjacent Industries that United Rentals 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
Talent to Manage Regulatory and Legal Obligations	Yes	No	Can be imitated by competitors	Yes	Not critical factor
Financial Resources of United Rentals	Yes	No	Financial instruments and market liquidity are available to all the nearest competitors	United Rentals has reasonably sound financial position	United Rentals has relatively sustainable Competitive Advantage
Marketing Expertise within United Rentals	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 United Rentals are often matched by competitors	Yes, United Rentals is leveraging both its inhouse marketing department and external expertise	Temporary Competitive Advantage
Access to Critical Raw Material for Successful Execution	Yes	Yes, as other competitors have to come to terms with United Rentals dominant market position	Can be imitated by competitors	Yes	Providing 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 United Rentals operates in	No, none of the competitors so far has able to imitate this expertise	Yes, United Rentals is successful at it	Providing Strong Competitive Advantage
Access to Cheap Capital for United Rentals	Yes, as a leading player in the industry and current macro economic conditions, United Rentals has access to cheap capital	No	Can be imitated by the competitors of United Rentals	Not been totally exploited	Not significant in creating competitive advantage
Brand Positioning of United Rentals 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
Customer Community of United Rentals	Yes, as customers are co-creating products	Yes, the United Rentals has able to build a special relationship with its customers	It is very difficult for United Rentals competitors to imitate the culture and community dedication	Going by the data, there is still a lot of upside in building on United Rentals customers community ecosystem	Providing Strong Competitive Advantage
Opportunities in the E-Commerce Space for United Rentals - using Present IT Capabilities	Yes, the e-commerce space is rapidly growing and United Rentals 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

United Rentals 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