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Welltower 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 Welltower to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for Welltower? Defining Valuable in VRIO
A resource or capability is considered valuable for Welltower , if it allows the
Welltower to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow Welltower to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for Welltower.
What are Rare Resources for Welltower? Defining Rare in VRIO
In an industry that Welltower operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. Welltower require rare resources to compete in the industry. If Welltower don’t have rare resources that are required to succeed in the industry then Welltower won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide Welltower competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for Welltower? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to Welltower 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. Welltower 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 Welltower
What is a Organization for Welltower? Defining Organization in VRIO
Even if the Welltower 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 Welltower 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 |
---|---|---|---|---|---|
Marketing Expertise within Welltower | 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 Welltower are often matched by competitors | Yes, Welltower is leveraging both its inhouse marketing department and external expertise | Temporary Competitive Advantage |
Access to Cheap Capital for Welltower | Yes, as a leading player in the industry and current macro economic conditions, Welltower has access to cheap capital | No | Can be imitated by the competitors of Welltower | Not been totally exploited | Not significant in creating competitive advantage |
Global and Local Presence of Welltower | Yes, as it diversify the revenue streams and isolate company's balance sheet from economic cycles | Yes | Can be imitated by competitors of Welltower but at a relatively high cost | Yes, it is one of the most diversified companies in its industry | Providing Strong Competitive Advantage |
Intellectual Property Rights, Copyrights, and Trademarks | Yes, they are extremely valuable for Welltower to thwart competition | Yes, IPR and other rights are rare and competition of Welltower 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 |
Pricing Strategies of Welltower | Yes, Welltower has sound pricing strategies | No | Pricing strategies are regularly imitated in the industry | Yes, firm has a pricing analytics engine | It can only provide Welltower with a Temporary Competitive Advantage |
Customer Community of Welltower | Yes, as customers are co-creating products | Yes, the Welltower has able to build a special relationship with its customers | It is very difficult for Welltower competitors to imitate the culture and community dedication | Going by the data, there is still a lot of upside in building on Welltower customers community ecosystem | Providing Strong Competitive Advantage |
Opportunities for Brand Extensions for Welltower 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 |
Position among Retailers and Wholesalers – Welltower retail strategy | Yes, Welltower has strong relationship with retailers and wholesalers | Yes, Welltower has dedicated channel partners | Difficult to imitate though not impossible | Yes, over the years company has used it successfully | Sustainable Competitive Advantage |
Sales Force and Channel Management of Welltower | Yes | No | Can be imitated by competitors | Still there is lot of potential to utilize the excellent sales force | Can provide Welltower sustainable competitive advantage. Potential is certainly there. |
Welltower 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 Welltower | Welltower is leveraging the customer loyalty to good effect | Provide Welltower medium term competitive advantage |
Alignment of Activities with Welltower 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, Welltower 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 Welltower | To a large extent yes | Providing Strong Competitive Advantage |
Opportunities in the Adjacent Industries that Welltower 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 |
Brand Positioning of Welltower 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 |
Welltower 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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