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Total System Services 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 Total System Services to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for Total System Services? Defining Valuable in VRIO
A resource or capability is considered valuable for Total System Services , if it allows the
Total System Services to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow Total System Services to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for Total System Services.
What are Rare Resources for Total System Services? Defining Rare in VRIO
In an industry that Total System Services operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. Total System Services require rare resources to compete in the industry. If Total System Services don’t have rare resources that are required to succeed in the industry then Total System Services won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide Total System Services competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for Total System Services? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to Total System Services 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. Total System Services 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 Total System Services
What is a Organization for Total System Services? Defining Organization in VRIO
Even if the Total System Services 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 Total System Services 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 |
---|---|---|---|---|---|
Talent to Manage Regulatory and Legal Obligations | Yes | No | Can be imitated by competitors | Yes | Not critical factor |
Customer Community of Total System Services | Yes, as customers are co-creating products | Yes, the Total System Services has able to build a special relationship with its customers | It is very difficult for Total System Services competitors to imitate the culture and community dedication | Going by the data, there is still a lot of upside in building on Total System Services customers community ecosystem | Providing Strong Competitive Advantage |
Pricing Strategies of Total System Services | Yes, Total System Services has sound pricing strategies | No | Pricing strategies are regularly imitated in the industry | Yes, firm has a pricing analytics engine | It can only provide Total System Services with a Temporary Competitive Advantage |
Product Portfolio and Synergy among Various Product Lines of Total System Services | 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 |
Opportunities in the Adjacent Industries that Total System Services 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 |
Vision of the Leadership for Next Set of Challenges | Yes | No | Can't be imitated by competitors of Total System Services | Not based on information provided in the case | Can Lead to Strong Competitive Advantage |
Supply Chain Network Flexibility of Total System Services | Yes | Yes | Near competitors also have flexible supply chain and share some of the suppliers | Fully utilized by Total System Services organizational structure and capabilities | Keeps the business running |
Brand Positioning of Total System Services 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 Leadership Team at Total System Services | Yes | Yes | Can't be imitated by competitors | Yes | 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 Total System Services operates in | No, none of the competitors so far has able to imitate this expertise | Yes, Total System Services is successful at it | Providing Strong Competitive Advantage |
Opportunities in the E-Commerce Space for Total System Services - using Present IT Capabilities | Yes, the e-commerce space is rapidly growing and Total System Services 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 Total System Services in delivering lower costs | No | Can be imitated by competitors of Total System Services but it is difficult | Yes | Medium to Long Term Competitive Advantage |
Global and Local Presence of Total System Services | Yes, as it diversify the revenue streams and isolate company's balance sheet from economic cycles | Yes | Can be imitated by competitors of Total System Services but at a relatively high cost | Yes, it is one of the most diversified companies in its industry | Providing Strong Competitive Advantage |
Opportunities for Brand Extensions for Total System Services 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 |
Total System Services 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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