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AMC Networks 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 AMC Networks to do better resource allocation and build a defensible value and supply chain.
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What is a Valuable Resource for AMC Networks? Defining Valuable in VRIO
A resource or capability is considered valuable for AMC Networks , if it allows the
AMC Networks to exploit opportunities or negate threats
emerging out of both the micro business environment and the macro environment. If a resource does not allow AMC Networks to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for AMC Networks.
What are Rare Resources for AMC Networks? Defining Rare in VRIO
In an industry that AMC Networks operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. AMC Networks require rare resources to compete in the industry. If AMC Networks don’t have rare resources that are required to succeed in the industry then AMC Networks won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide AMC Networks competitive advantage against players that don’t have those rare resources. HBR Case Study Solution
What is a Inimitable (Difficult to Immitate) Resource for AMC Networks? Defining Inimitable in VRIO
A valuable and rare resource can provide a competitive advantage to AMC Networks 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. AMC Networks 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 AMC Networks
What is a Organization for AMC Networks? Defining Organization in VRIO
Even if the AMC Networks 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 AMC Networks 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 |
---|---|---|---|---|---|
Access to Critical Raw Material for Successful Execution | Yes | Yes, as other competitors have to come to terms with AMC Networks dominant market position | Can be imitated by competitors | Yes | Providing Sustainable Competitive Advantage |
Brand Positioning of AMC Networks 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 |
AMC Networks 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 AMC Networks | AMC Networks is leveraging the customer loyalty to good effect | Provide AMC Networks medium term competitive advantage |
Successful Implementation of Digital Strategy at AMC Networks | 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 |
Vision of the Leadership for Next Set of Challenges | Yes | No | Can't be imitated by competitors of AMC Networks | Not based on information provided in the case | Can Lead to Strong Competitive Advantage |
Access to Cheap Capital for AMC Networks | Yes, as a leading player in the industry and current macro economic conditions, AMC Networks has access to cheap capital | No | Can be imitated by the competitors of AMC Networks | Not been totally exploited | Not significant in creating competitive advantage |
Financial Resources of AMC Networks | Yes | No | Financial instruments and market liquidity are available to all the nearest competitors | AMC Networks has reasonably sound financial position | AMC Networks has relatively sustainable Competitive Advantage |
Talent to Manage Regulatory and Legal Obligations | Yes | No | Can be imitated by competitors | Yes | Not critical factor |
Sales Force and Channel Management of AMC Networks | Yes | No | Can be imitated by competitors | Still there is lot of potential to utilize the excellent sales force | Can provide AMC Networks sustainable competitive advantage. Potential is certainly there. |
Track Record of Leadership Team at AMC Networks | Yes | Yes | Can't be imitated by competitors | Yes | Providing Strong Competitive Advantage |
Brand awareness of AMC Networks products and services | Yes, the brand awareness of AMC Networks products are high | Yes, AMC Networks has one of the leading brand in the industry | No | AMC Networks has utilized its leading brand position in various segments | Sustainable Competitive Advantage |
Customer Community of AMC Networks | Yes, as customers are co-creating products | Yes, the AMC Networks has able to build a special relationship with its customers | It is very difficult for AMC Networks competitors to imitate the culture and community dedication | Going by the data, there is still a lot of upside in building on AMC Networks customers community ecosystem | Providing Strong Competitive Advantage |
Intellectual Property Rights, Copyrights, and Trademarks | Yes, they are extremely valuable for AMC Networks to thwart competition | Yes, IPR and other rights are rare and competition of AMC Networks 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 |
Pricing Strategies of AMC Networks | Yes, AMC Networks has sound pricing strategies | No | Pricing strategies are regularly imitated in the industry | Yes, firm has a pricing analytics engine | It can only provide AMC Networks with a Temporary Competitive Advantage |
AMC Networks 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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