LPL Financial Holdings 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 LPL Financial Holdings to do better resource allocation and build a defensible value and supply chain.

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What is a Valuable Resource for LPL Financial Holdings? Defining Valuable in VRIO

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

What are Rare Resources for LPL Financial Holdings? Defining Rare in VRIO

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

What is a Inimitable (Difficult to Immitate) Resource for LPL Financial Holdings? Defining Inimitable in VRIO

A valuable and rare resource can provide a competitive advantage to LPL Financial Holdings 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. LPL Financial Holdings 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 LPL Financial Holdings

What is a Organization for LPL Financial Holdings? Defining Organization in VRIO

Even if the LPL Financial Holdings 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 LPL Financial Holdings 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 LPL Financial Holdings 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
Access to Cheap Capital for LPL Financial Holdings	Yes, as a leading player in the industry and current macro economic conditions, LPL Financial Holdings has access to cheap capital	No	Can be imitated by the competitors of LPL Financial Holdings	Not been totally exploited	Not significant in creating competitive advantage
Global and Local Presence of LPL Financial Holdings	Yes, as it diversify the revenue streams and isolate company's balance sheet from economic cycles	Yes	Can be imitated by competitors of LPL Financial Holdings but at a relatively high cost	Yes, it is one of the most diversified companies in its industry	Providing Strong Competitive Advantage
Access to Critical Raw Material for Successful Execution	Yes	Yes, as other competitors have to come to terms with LPL Financial Holdings dominant market position	Can be imitated by competitors	Yes	Providing Sustainable Competitive Advantage
Marketing Expertise within LPL Financial Holdings	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 LPL Financial Holdings are often matched by competitors	Yes, LPL Financial Holdings is leveraging both its inhouse marketing department and external expertise	Temporary Competitive Advantage
Customer Community of LPL Financial Holdings	Yes, as customers are co-creating products	Yes, the LPL Financial Holdings has able to build a special relationship with its customers	It is very difficult for LPL Financial Holdings competitors to imitate the culture and community dedication	Going by the data, there is still a lot of upside in building on LPL Financial Holdings customers community ecosystem	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 LPL Financial Holdings operates in	No, none of the competitors so far has able to imitate this expertise	Yes, LPL Financial Holdings is successful at it	Providing Strong Competitive Advantage
Financial Resources of LPL Financial Holdings	Yes	No	Financial instruments and market liquidity are available to all the nearest competitors	LPL Financial Holdings has reasonably sound financial position	LPL Financial Holdings has relatively sustainable Competitive Advantage
Ability to Attract Talent in Various Local & Global Markets	Yes, LPL Financial Holdings 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 LPL Financial Holdings	To a large extent yes	Providing Strong Competitive Advantage
Opportunities for Brand Extensions for LPL Financial Holdings 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
Brand Positioning of LPL Financial Holdings 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 LPL Financial Holdings	Yes	No	Can be imitated by competitors	Still there is lot of potential to utilize the excellent sales force	Can provide LPL Financial Holdings sustainable competitive advantage. Potential is certainly there.
Distribution and Logistics Costs Competitiveness	Yes, as it helps LPL Financial Holdings in delivering lower costs	No	Can be imitated by competitors of LPL Financial Holdings but it is difficult	Yes	Medium to Long Term Competitive Advantage
Supply Chain Network Flexibility of LPL Financial Holdings	Yes	Yes	Near competitors also have flexible supply chain and share some of the suppliers	Fully utilized by LPL Financial Holdings organizational structure and capabilities	Keeps the business running

LPL Financial Holdings 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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