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Lexmark International 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 Lexmark International to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for Lexmark International? Defining Valuable in VRIO
A resource or capability is considered valuable for Lexmark International , if it allows the
Lexmark International to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow Lexmark International to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for Lexmark International.
What are Rare Resources for Lexmark International? Defining Rare in VRIO
In an industry that Lexmark International operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. Lexmark International require rare resources to compete in the industry. If Lexmark International don’t have rare resources that are required to succeed in the industry then Lexmark International won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide Lexmark International competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for Lexmark International? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to Lexmark International 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. Lexmark International 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 Lexmark International
What is a Organization for Lexmark International? Defining Organization in VRIO
Even if the Lexmark International 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 Lexmark International 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 |
---|---|---|---|---|---|
Pricing Strategies of Lexmark International | Yes, Lexmark International has sound pricing strategies | No | Pricing strategies are regularly imitated in the industry | Yes, firm has a pricing analytics engine | It can only provide Lexmark International with a Temporary Competitive Advantage |
Intellectual Property Rights, Copyrights, and Trademarks | Yes, they are extremely valuable for Lexmark International to thwart competition | Yes, IPR and other rights are rare and competition of Lexmark International 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 |
Marketing Expertise within Lexmark International | 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 Lexmark International are often matched by competitors | Yes, Lexmark International is leveraging both its inhouse marketing department and external expertise | Temporary Competitive Advantage |
Opportunities in the E-Commerce Space for Lexmark International - using Present IT Capabilities | Yes, the e-commerce space is rapidly growing and Lexmark International 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 |
Distribution and Logistics Costs Competitiveness | Yes, as it helps Lexmark International in delivering lower costs | No | Can be imitated by competitors of Lexmark International but it is difficult | Yes | Medium to Long Term Competitive Advantage |
Customer Community of Lexmark International | Yes, as customers are co-creating products | Yes, the Lexmark International has able to build a special relationship with its customers | It is very difficult for Lexmark International competitors to imitate the culture and community dedication | Going by the data, there is still a lot of upside in building on Lexmark International 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 Lexmark International operates in | No, none of the competitors so far has able to imitate this expertise | Yes, Lexmark International is successful at it | Providing Strong Competitive Advantage |
Supply Chain Network Flexibility of Lexmark International | Yes | Yes | Near competitors also have flexible supply chain and share some of the suppliers | Fully utilized by Lexmark International organizational structure and capabilities | Keeps the business running |
Access to Critical Raw Material for Successful Execution | Yes | Yes, as other competitors have to come to terms with Lexmark International dominant market position | Can be imitated by competitors | Yes | Providing Sustainable Competitive Advantage |
Vision of the Leadership for Next Set of Challenges | Yes | No | Can't be imitated by competitors of Lexmark International | Not based on information provided in the case | Can Lead to Strong Competitive Advantage |
Global and Local Presence of Lexmark International | Yes, as it diversify the revenue streams and isolate company's balance sheet from economic cycles | Yes | Can be imitated by competitors of Lexmark International but at a relatively high cost | Yes, it is one of the most diversified companies in its industry | Providing Strong Competitive Advantage |
Track Record of Leadership Team at Lexmark International | Yes | Yes | Can't be imitated by competitors | Yes | Providing Strong Competitive Advantage |
Opportunities in the Adjacent Industries that Lexmark International 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 |
Ability to Attract Talent in Various Local & Global Markets | Yes, Lexmark International 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 Lexmark International | To a large extent yes | Providing Strong Competitive Advantage |
Lexmark International 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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