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Activision Blizzard 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 Activision Blizzard to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for Activision Blizzard? Defining Valuable in VRIO
A resource or capability is considered valuable for Activision Blizzard , if it allows the
Activision Blizzard to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow Activision Blizzard to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for Activision Blizzard.
What are Rare Resources for Activision Blizzard? Defining Rare in VRIO
In an industry that Activision Blizzard operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. Activision Blizzard require rare resources to compete in the industry. If Activision Blizzard don’t have rare resources that are required to succeed in the industry then Activision Blizzard won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide Activision Blizzard competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for Activision Blizzard? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to Activision Blizzard 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. Activision Blizzard 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 Activision Blizzard
What is a Organization for Activision Blizzard? Defining Organization in VRIO
Even if the Activision Blizzard 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 Activision Blizzard 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 |
---|---|---|---|---|---|
Alignment of Activities with Activision Blizzard 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 |
Ability to Attract Talent in Various Local & Global Markets | Yes, Activision Blizzard 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 Activision Blizzard | To a large extent yes | Providing Strong Competitive Advantage |
Access to Critical Raw Material for Successful Execution | Yes | Yes, as other competitors have to come to terms with Activision Blizzard dominant market position | Can be imitated by competitors | Yes | Providing Sustainable Competitive Advantage |
Customer Community of Activision Blizzard | Yes, as customers are co-creating products | Yes, the Activision Blizzard has able to build a special relationship with its customers | It is very difficult for Activision Blizzard competitors to imitate the culture and community dedication | Going by the data, there is still a lot of upside in building on Activision Blizzard customers community ecosystem | Providing Strong Competitive Advantage |
Activision Blizzard 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 Activision Blizzard | Activision Blizzard is leveraging the customer loyalty to good effect | Provide Activision Blizzard medium term competitive advantage |
Successful Implementation of Digital Strategy at Activision Blizzard | 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 |
Access to Cheap Capital for Activision Blizzard | Yes, as a leading player in the industry and current macro economic conditions, Activision Blizzard has access to cheap capital | No | Can be imitated by the competitors of Activision Blizzard | Not been totally exploited | Not significant in creating competitive advantage |
Track Record of Leadership Team at Activision Blizzard | Yes | Yes | Can't be imitated by competitors | Yes | Providing Strong Competitive Advantage |
Position among Retailers and Wholesalers – Activision Blizzard retail strategy | Yes, Activision Blizzard has strong relationship with retailers and wholesalers | Yes, Activision Blizzard has dedicated channel partners | Difficult to imitate though not impossible | Yes, over the years company has used it successfully | Sustainable Competitive Advantage |
Intellectual Property Rights, Copyrights, and Trademarks | Yes, they are extremely valuable for Activision Blizzard to thwart competition | Yes, IPR and other rights are rare and competition of Activision Blizzard 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 |
Talent to Manage Regulatory and Legal Obligations | Yes | No | Can be imitated by competitors | Yes | Not critical factor |
Supply Chain Network Flexibility of Activision Blizzard | Yes | Yes | Near competitors also have flexible supply chain and share some of the suppliers | Fully utilized by Activision Blizzard organizational structure and capabilities | Keeps the business running |
Brand Positioning of Activision Blizzard 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 |
Financial Resources of Activision Blizzard | Yes | No | Financial instruments and market liquidity are available to all the nearest competitors | Activision Blizzard has reasonably sound financial position | Activision Blizzard has relatively sustainable Competitive Advantage |
Activision Blizzard 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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