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Sanderson Farms 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 Sanderson Farms to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for Sanderson Farms? Defining Valuable in VRIO
A resource or capability is considered valuable for Sanderson Farms , if it allows the
Sanderson Farms to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow Sanderson Farms to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for Sanderson Farms.
What are Rare Resources for Sanderson Farms? Defining Rare in VRIO
In an industry that Sanderson Farms operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. Sanderson Farms require rare resources to compete in the industry. If Sanderson Farms don’t have rare resources that are required to succeed in the industry then Sanderson Farms won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide Sanderson Farms competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for Sanderson Farms? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to Sanderson Farms 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. Sanderson Farms 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 Sanderson Farms
What is a Organization for Sanderson Farms? Defining Organization in VRIO
Even if the Sanderson Farms 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 Sanderson Farms 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 Sanderson Farms | 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 Sanderson Farms are often matched by competitors | Yes, Sanderson Farms is leveraging both its inhouse marketing department and external expertise | Temporary Competitive Advantage |
Brand Positioning of Sanderson Farms 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 |
Track Record of Project Execution | Yes, especially in an industry where there are frequent cost overun | Yes, especially in the segment that Sanderson Farms operates in | No, none of the competitors so far has able to imitate this expertise | Yes, Sanderson Farms is successful at it | Providing Strong Competitive Advantage |
Intellectual Property Rights, Copyrights, and Trademarks | Yes, they are extremely valuable for Sanderson Farms to thwart competition | Yes, IPR and other rights are rare and competition of Sanderson Farms 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 |
Vision of the Leadership for Next Set of Challenges | Yes | No | Can't be imitated by competitors of Sanderson Farms | Not based on information provided in the case | Can Lead to Strong Competitive Advantage |
Alignment of Activities with Sanderson Farms 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 Sanderson Farms | 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 |
Distribution and Logistics Costs Competitiveness | Yes, as it helps Sanderson Farms in delivering lower costs | No | Can be imitated by competitors of Sanderson Farms but it is difficult | Yes | Medium to Long Term Competitive Advantage |
Ability to Attract Talent in Various Local & Global Markets | Yes, Sanderson Farms 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 Sanderson Farms | To a large extent yes | Providing Strong Competitive Advantage |
Brand awareness of Sanderson Farms products and services | Yes, the brand awareness of Sanderson Farms products are high | Yes, Sanderson Farms has one of the leading brand in the industry | No | Sanderson Farms has utilized its leading brand position in various segments | Sustainable Competitive Advantage |
Access to Critical Raw Material for Successful Execution | Yes | Yes, as other competitors have to come to terms with Sanderson Farms dominant market position | Can be imitated by competitors | Yes | Providing Sustainable Competitive Advantage |
Talent to Manage Regulatory and Legal Obligations | Yes | No | Can be imitated by competitors | Yes | Not critical factor |
Opportunities for Brand Extensions for Sanderson Farms 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 |
Supply Chain Network Flexibility of Sanderson Farms | Yes | Yes | Near competitors also have flexible supply chain and share some of the suppliers | Fully utilized by Sanderson Farms organizational structure and capabilities | Keeps the business running |
Sanderson Farms 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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