Armstrong World Industries 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 Armstrong World Industries to do better resource allocation and build a defensible value and supply chain.

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What is a Valuable Resource for Armstrong World Industries? Defining Valuable in VRIO

A resource or capability is considered valuable for Armstrong World Industries , if it allows the Armstrong World Industries to exploit opportunities or negate threats emerging out of both the micro business environment and the macro environment. If a resource does not allow Armstrong World Industries to minimize threats or exploit opportunities, than it doesn't contribute signficantly to building a sustainable competitive advantage for Armstrong World Industries.

What are Rare Resources for Armstrong World Industries? Defining Rare in VRIO

In an industry that Armstrong World Industries operates in, valuable resources are held by number of competitors. So valuable resources themselves don’t provide a sustainable competitive advantage. Armstrong World Industries require rare resources to compete in the industry. If Armstrong World Industries don’t have rare resources that are required to succeed in the industry then Armstrong World Industries won’t be able to compete successfully in the marketplace. Secondly holding rare resources can provide Armstrong World Industries competitive advantage against players that don’t have those rare resources. HBR Case Study Solution

What is a Inimitable (Difficult to Immitate) Resource for Armstrong World Industries? Defining Inimitable in VRIO

A valuable and rare resource can provide a competitive advantage to Armstrong World Industries 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. Armstrong World Industries 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 Armstrong World Industries

What is a Organization for Armstrong World Industries? Defining Organization in VRIO

Even if the Armstrong World Industries 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 Armstrong World Industries 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 Cheap Capital for Armstrong World Industries	Yes, as a leading player in the industry and current macro economic conditions, Armstrong World Industries has access to cheap capital	No	Can be imitated by the competitors of Armstrong World Industries	Not been totally exploited	Not significant in creating competitive advantage
Global and Local Presence of Armstrong World Industries	Yes, as it diversify the revenue streams and isolate company's balance sheet from economic cycles	Yes	Can be imitated by competitors of Armstrong World Industries but at a relatively high cost	Yes, it is one of the most diversified companies in its industry	Providing Strong Competitive Advantage
Brand awareness of Armstrong World Industries products and services	Yes, the brand awareness of Armstrong World Industries products are high	Yes, Armstrong World Industries has one of the leading brand in the industry	No	Armstrong World Industries has utilized its leading brand position in various segments	Sustainable Competitive Advantage
Successful Implementation of Digital Strategy at Armstrong World Industries	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
Opportunities in the Adjacent Industries that Armstrong World Industries 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
Financial Resources of Armstrong World Industries	Yes	No	Financial instruments and market liquidity are available to all the nearest competitors	Armstrong World Industries has reasonably sound financial position	Armstrong World Industries has relatively sustainable Competitive Advantage
Opportunities in the E-Commerce Space for Armstrong World Industries - using Present IT Capabilities	Yes, the e-commerce space is rapidly growing and Armstrong World Industries 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
Talent to Manage Regulatory and Legal Obligations	Yes	No	Can be imitated by competitors	Yes	Not critical factor
Position among Retailers and Wholesalers – Armstrong World Industries retail strategy	Yes, Armstrong World Industries has strong relationship with retailers and wholesalers	Yes, Armstrong World Industries has dedicated channel partners	Difficult to imitate though not impossible	Yes, over the years company has used it successfully	Sustainable Competitive Advantage
Armstrong World Industries 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 Armstrong World Industries	Armstrong World Industries is leveraging the customer loyalty to good effect	Provide Armstrong World Industries medium term competitive advantage
Customer Community of Armstrong World Industries	Yes, as customers are co-creating products	Yes, the Armstrong World Industries has able to build a special relationship with its customers	It is very difficult for Armstrong World Industries competitors to imitate the culture and community dedication	Going by the data, there is still a lot of upside in building on Armstrong World Industries customers community ecosystem	Providing Strong Competitive Advantage
Vision of the Leadership for Next Set of Challenges	Yes	No	Can't be imitated by competitors of Armstrong World Industries	Not based on information provided in the case	Can Lead to Strong Competitive Advantage
Track Record of Leadership Team at Armstrong World Industries	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 Armstrong World Industries operates in	No, none of the competitors so far has able to imitate this expertise	Yes, Armstrong World Industries is successful at it	Providing Strong Competitive Advantage

Armstrong World Industries SWOT Analysis, SWOT Matrix, Weighted SWOT Case Study Solution & Analysis

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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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