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Westinghouse Air Brake Technologies 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 Westinghouse Air Brake Technologies to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for Westinghouse Air Brake Technologies? Defining Valuable in VRIO
A resource or capability is considered valuable for Westinghouse Air Brake Technologies , if it allows the
Westinghouse Air Brake Technologies to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow Westinghouse Air Brake Technologies to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for Westinghouse Air Brake Technologies.
What are Rare Resources for Westinghouse Air Brake Technologies? Defining Rare in VRIO
In an industry that Westinghouse Air Brake Technologies operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. Westinghouse Air Brake Technologies require rare resources to compete in the industry. If Westinghouse Air Brake Technologies don’t have rare resources that are required to succeed in the industry then Westinghouse Air Brake Technologies won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide Westinghouse Air Brake Technologies competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for Westinghouse Air Brake Technologies? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to Westinghouse Air Brake Technologies 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. Westinghouse Air Brake Technologies 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 Westinghouse Air Brake Technologies
What is a Organization for Westinghouse Air Brake Technologies? Defining Organization in VRIO
Even if the Westinghouse Air Brake Technologies 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 Westinghouse Air Brake Technologies 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 |
---|---|---|---|---|---|
Customer Community of Westinghouse Air Brake Technologies | Yes, as customers are co-creating products | Yes, the Westinghouse Air Brake Technologies has able to build a special relationship with its customers | It is very difficult for Westinghouse Air Brake Technologies competitors to imitate the culture and community dedication | Going by the data, there is still a lot of upside in building on Westinghouse Air Brake Technologies customers community ecosystem | Providing Strong Competitive Advantage |
Ability to Attract Talent in Various Local & Global Markets | Yes, Westinghouse Air Brake Technologies 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 Westinghouse Air Brake Technologies | To a large extent yes | Providing Strong Competitive Advantage |
Vision of the Leadership for Next Set of Challenges | Yes | No | Can't be imitated by competitors of Westinghouse Air Brake Technologies | Not based on information provided in the case | Can Lead to 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 Westinghouse Air Brake Technologies operates in | No, none of the competitors so far has able to imitate this expertise | Yes, Westinghouse Air Brake Technologies is successful at it | 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 Westinghouse Air Brake Technologies | Yes | Yes | Near competitors also have flexible supply chain and share some of the suppliers | Fully utilized by Westinghouse Air Brake Technologies 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 Westinghouse Air Brake Technologies dominant market position | Can be imitated by competitors | Yes | Providing Sustainable Competitive Advantage |
Alignment of Activities with Westinghouse Air Brake Technologies 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 |
Product Portfolio and Synergy among Various Product Lines of Westinghouse Air Brake Technologies | Yes, it is valuable in the industry given the various segmentations & consumer preferences. | Most of the competitors are trying to enter the lucrative segments | Can be imitated by the competitors | The firm has used it to good effect, details can be found in case exhibit | Provide short term competitive advantage but requires constant innovation to sustain |
Access to Cheap Capital for Westinghouse Air Brake Technologies | Yes, as a leading player in the industry and current macro economic conditions, Westinghouse Air Brake Technologies has access to cheap capital | No | Can be imitated by the competitors of Westinghouse Air Brake Technologies | Not been totally exploited | Not significant in creating competitive advantage |
Global and Local Presence of Westinghouse Air Brake Technologies | Yes, as it diversify the revenue streams and isolate company's balance sheet from economic cycles | Yes | Can be imitated by competitors of Westinghouse Air Brake Technologies 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 Westinghouse Air Brake Technologies to thwart competition | Yes, IPR and other rights are rare and competition of Westinghouse Air Brake Technologies 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 |
Track Record of Leadership Team at Westinghouse Air Brake Technologies | Yes | Yes | Can't be imitated by competitors | Yes | Providing Strong Competitive Advantage |
Position among Retailers and Wholesalers – Westinghouse Air Brake Technologies retail strategy | Yes, Westinghouse Air Brake Technologies has strong relationship with retailers and wholesalers | Yes, Westinghouse Air Brake Technologies has dedicated channel partners | Difficult to imitate though not impossible | Yes, over the years company has used it successfully | Sustainable Competitive Advantage |
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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