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ServiceMaster Global Holdings 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 ServiceMaster Global Holdings to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for ServiceMaster Global Holdings? Defining Valuable in VRIO
A resource or capability is considered valuable for ServiceMaster Global Holdings , if it allows the
ServiceMaster Global Holdings to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow ServiceMaster Global Holdings to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for ServiceMaster Global Holdings.
What are Rare Resources for ServiceMaster Global Holdings? Defining Rare in VRIO
In an industry that ServiceMaster Global Holdings operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. ServiceMaster Global Holdings require rare resources to compete in the industry. If ServiceMaster Global Holdings don’t have rare resources that are required to succeed in the industry then ServiceMaster Global Holdings won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide ServiceMaster Global Holdings competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for ServiceMaster Global Holdings? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to ServiceMaster Global Holdings 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. ServiceMaster Global Holdings 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 ServiceMaster Global Holdings
What is a Organization for ServiceMaster Global Holdings? Defining Organization in VRIO
Even if the ServiceMaster Global Holdings 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 ServiceMaster Global Holdings 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 |
---|---|---|---|---|---|
Brand awareness of ServiceMaster Global Holdings products and services | Yes, the brand awareness of ServiceMaster Global Holdings products are high | Yes, ServiceMaster Global Holdings has one of the leading brand in the industry | No | ServiceMaster Global Holdings has utilized its leading brand position in various segments | Sustainable Competitive Advantage |
Sales Force and Channel Management of ServiceMaster Global Holdings | Yes | No | Can be imitated by competitors | Still there is lot of potential to utilize the excellent sales force | Can provide ServiceMaster Global Holdings sustainable competitive advantage. Potential is certainly there. |
Opportunities in the Adjacent Industries that ServiceMaster Global Holdings 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 |
Successful Implementation of Digital Strategy at ServiceMaster Global Holdings | 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 |
Ability to Attract Talent in Various Local & Global Markets | Yes, ServiceMaster Global Holdings 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 ServiceMaster Global Holdings | To a large extent yes | Providing Strong Competitive Advantage |
Marketing Expertise within ServiceMaster Global Holdings | 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 ServiceMaster Global Holdings are often matched by competitors | Yes, ServiceMaster Global Holdings is leveraging both its inhouse marketing department and external expertise | Temporary Competitive Advantage |
Track Record of Leadership Team at ServiceMaster Global Holdings | Yes | Yes | Can't be imitated by competitors | Yes | Providing Strong Competitive Advantage |
Opportunities in the E-Commerce Space for ServiceMaster Global Holdings - using Present IT Capabilities | Yes, the e-commerce space is rapidly growing and ServiceMaster Global Holdings 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 |
Vision of the Leadership for Next Set of Challenges | Yes | No | Can't be imitated by competitors of ServiceMaster Global Holdings | Not based on information provided in the case | Can Lead to Strong Competitive Advantage |
Product Portfolio and Synergy among Various Product Lines of ServiceMaster Global Holdings | 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 |
Brand Positioning of ServiceMaster Global Holdings 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 |
Financial Resources of ServiceMaster Global Holdings | Yes | No | Financial instruments and market liquidity are available to all the nearest competitors | ServiceMaster Global Holdings has reasonably sound financial position | ServiceMaster Global Holdings has relatively sustainable Competitive Advantage |
Pricing Strategies of ServiceMaster Global Holdings | Yes, ServiceMaster Global Holdings has sound pricing strategies | No | Pricing strategies are regularly imitated in the industry | Yes, firm has a pricing analytics engine | It can only provide ServiceMaster Global Holdings with a Temporary Competitive Advantage |
Opportunities for Brand Extensions for ServiceMaster Global Holdings 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 |
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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