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Buckeye Partners 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 Buckeye Partners to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for Buckeye Partners? Defining Valuable in VRIO
A resource or capability is considered valuable for Buckeye Partners , if it allows the
Buckeye Partners to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow Buckeye Partners to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for Buckeye Partners.
What are Rare Resources for Buckeye Partners? Defining Rare in VRIO
In an industry that Buckeye Partners operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. Buckeye Partners require rare resources to compete in the industry. If Buckeye Partners don’t have rare resources that are required to succeed in the industry then Buckeye Partners won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide Buckeye Partners competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for Buckeye Partners? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to Buckeye Partners 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. Buckeye Partners 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 Buckeye Partners
What is a Organization for Buckeye Partners? Defining Organization in VRIO
Even if the Buckeye Partners 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 Buckeye Partners 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 |
---|---|---|---|---|---|
Distribution and Logistics Costs Competitiveness | Yes, as it helps Buckeye Partners in delivering lower costs | No | Can be imitated by competitors of Buckeye Partners but it is difficult | Yes | Medium to Long Term Competitive Advantage |
Global and Local Presence of Buckeye Partners | Yes, as it diversify the revenue streams and isolate company's balance sheet from economic cycles | Yes | Can be imitated by competitors of Buckeye Partners but at a relatively high cost | Yes, it is one of the most diversified companies in its industry | Providing Strong Competitive Advantage |
Brand awareness of Buckeye Partners products and services | Yes, the brand awareness of Buckeye Partners products are high | Yes, Buckeye Partners has one of the leading brand in the industry | No | Buckeye Partners has utilized its leading brand position in various segments | Sustainable Competitive Advantage |
Marketing Expertise within Buckeye Partners | 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 Buckeye Partners are often matched by competitors | Yes, Buckeye Partners is leveraging both its inhouse marketing department and external expertise | Temporary Competitive Advantage |
Alignment of Activities with Buckeye Partners 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 |
Buckeye Partners 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 Buckeye Partners | Buckeye Partners is leveraging the customer loyalty to good effect | Provide Buckeye Partners medium term 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 Buckeye Partners | Yes | Yes | Near competitors also have flexible supply chain and share some of the suppliers | Fully utilized by Buckeye Partners organizational structure and capabilities | Keeps the business running |
Financial Resources of Buckeye Partners | Yes | No | Financial instruments and market liquidity are available to all the nearest competitors | Buckeye Partners has reasonably sound financial position | Buckeye Partners has relatively sustainable Competitive Advantage |
Pricing Strategies of Buckeye Partners | Yes, Buckeye Partners has sound pricing strategies | No | Pricing strategies are regularly imitated in the industry | Yes, firm has a pricing analytics engine | It can only provide Buckeye Partners with a Temporary Competitive Advantage |
Successful Implementation of Digital Strategy at Buckeye Partners | 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 |
Track Record of Leadership Team at Buckeye Partners | Yes | Yes | Can't be imitated by competitors | Yes | Providing Strong Competitive Advantage |
Vision of the Leadership for Next Set of Challenges | Yes | No | Can't be imitated by competitors of Buckeye Partners | Not based on information provided in the case | Can Lead to Strong Competitive Advantage |
Opportunities in the Adjacent Industries that Buckeye Partners 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 |
Buckeye Partners 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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