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Hindustan Unilever Limited VRIO VRIN Analysis Amp Solution MBA Resources

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Hindustan Unilever Limited VRIO / VRIN Analysis &

Solution/ MBA Resources


embapro.com/frontpage/vrioanalysis/11231-hul-s-resisting

Case Authors : Thomas J. DeLong, Mona Sinha

Topic : Organizational Development

Related Areas : Conflict, Human resource management, Leadership, Organizational culture

EMBA Pro VRIO / VRIN Analysis Approach to Hindustan Unilever


Limited Case Study

At EMBA PRO, we provide corporate level professional Marketing Mix and Marketing
Strategy solutions. Hindustan Unilever Limited case study is a Harvard Business School
(HBR) case study written by Thomas J. DeLong, Mona Sinha. The Hindustan Unilever
Limited (referred as “Hul's Resisting” from here on) case study provides evaluation &
decision scenario in field of Organizational Development. It also touches upon business
topics such as - Marketing Mix, Product, Price, Place, Promotion, 4P, Conflict, Human
resource management, Leadership, Organizational culture.

Our immersive learning methodology from – case study discussions to simulations tools
help MBA and EMBA professionals to - gain new insight, deepen their knowledge of the
Organizational Development field, VRIO Analysis, case solution, VRIN Solution, Resource
based Strategic Management- Value, Rare, Imitation Risk, Organization Competence, and
more.

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What is the VRIO framework / model? What are the components of
VRIO? Why is VRIO important?

VRIO Framework was first developed by Jay B Barney to evaluate the relative importance
of resources to the firm. VRIO stands for – Value of the resource, Rareness of the
resource, Imitation Risk, and Organizational Competence. VRIO is a resource
focused strategic analysis tool. Leaders at Hul's Resisting can use VRIO to build
sustainable competitive advantage by better understanding the role of resources in Hul's
Resisting’s overall business model.

VRIO Analysis of Hindustan Unilever Limited

Competitive
Resources Value Rare Imitation Organization Advantage

Pricing Yes No Pricing Yes, firm has Temporary


Strategies strategies a pricing Competitive
are analytics Advantage
regularly engine
imitated in
the industry

Ability to Yes, Hul's Yes, as Difficult to To a large Providing


Attract Talent Resisting talent is imitate extent yes Strong
in Various strategy is critical to Competitive
Local & built on firm's Advantage
Global successful growth
Markets innovation
and
localization
of products

Intellectual Yes, they Yes, IPR Risk of So far the Providing


Property are and other imitation is firm has not Strong
Rights, extremely rights are low but utilized the Competitive
Copyrights, valuable rare and given the full extent of Advantage
and especially competition margins in its IPR &
Trademarks to thwart can't copy the industry other
competition disruption properties
chances
are high

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Competitive
Resources Value Rare Imitation Organization Advantage

Opportunities Can be No Can be All the Has


in the valuable as imitated by capabilities of potential
Adjacent they will competitors the
Industries & create new organization
New revenue are not fully
Resources streams utilized yet
Required to
Enter those
Industries

Access to Yes Yes, as Can be Yes Providing


Critical Raw other imitated by Sustainable
Material for competitors competitors Competitive
Successful have to Advantage
Execution come to
terms with
firm's
dominant
market
position

Customer Yes, as Yes, the It is very Going by the Providing


Community customers firm has difficult to data, there is Strong
are co- able to imitate the still a lot of Competitive
creating build a culture and upside Advantage
products special community
relationship dedication
with its
customers

Global and Yes, as it Yes Can be Yes, it is one Providing


Local diversify imitated by of the most Strong
Presence the competitors diversified Competitive
revenue companies in Advantage
streams its industry
and isolate
company's
balance
sheet from
economic
cycles

Customer Yes, 23% Yes, firm Has been Company is Provide


Network and of the has tried by leveraging medium
Loyalty customers invested to competitors the customer term
contribute build a but none of loyalty to competitive
to more strong them are good effect advantage
than 84% customer as
of the sales loyalty successful
revenue

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Competitive
Resources Value Rare Imitation Organization Advantage

Sales Force Yes No Can be Still there is Can provide


and Channel imitated by lot of sustainable
Management competitors potential to competitive
utilize the advantage.
excellent Potential is
sales force certainly
there.

Brand Yes Yes, Hul's No Hul's Sustainable


awareness Resisting Resisting has Competitive
has one of utilized its Advantage
the leading leading brand
brand in position in
the industry various
segments

What is a Resource in VRIO? Classification of Resources for VRIO


Analysis.

Resources of an organization can be categorized into two categories - Tangible resources


and Intangible Resources. Tangible resources of Hul's Resisting include - physical
entities, such as land, buildings, plant, equipment, inventory, and money. Intangible
resources of Hul's Resisting are –skill and administrative level of managers, brand names
and goodwill of the company, intellectual property rights, copyrights, trademarks, and
special relationship with supply chain partners.

The four components of VRIO used in Hindustan Unilever Limited


analysis are –

Valuable – Is the resource valuable to Hul's Resisting. According to Thomas J. DeLong,


Mona Sinha of the case study following are the critical resources that are valuable to the
firm - financial resources, human resources, marketing expertise, and operations
management.

Rare – "Hul's Resisting" needs to ask is whether the resources that are valuable to the
Hul's Resisting are rare or costly to attain. If they are not rare than both present
competitors and new entrants will easily able to get access to them and enter the
competitive landscape.

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Costly to Imitate – At present most industries are facing increasing threats of disruption.
According to the data provided in Hindustan Unilever Limited – it seems that the core
differentiation of the Hul's Resisting is difficult to imitate. On a broader scale – imitation
of products of Hul's Resisting can happen in two ways – Duplication of the products of the
company, and competitors coming up with substitute products that disrupt the present
industry structure.

Organizational Competence & Capabilities to Make Most of the Resources – It measures


how much the company has able to harness the valuable, rare and difficult to imitate
resource in the market place. The exploitation level analysis for Hul's Resisting products
can be done from two perspectives. Is the firm able to fully exploit the potential of the
resource, or it still has lots of upside.
Often the exploitation level is highly dependent upon execution team and execution
strategy of the firm. So exploitation level is a good barometer to assess the quality of
human resources in the organization. Capabilities tend to arise or expand over time as a
firm takes actions that build on its strategic resources.

VRIO and VRIN of Hindustan Unilever Limited

Another extension of VRIO analysis is VRIN where “N” stands non substitutable. A
resource is non substitutable if the competitors can’t find alternative ways to gain the
advantages that a resource provides. In the VRIO analysis we can include the disruption
risk under imitation risk.

Define the four characteristics of resources that lead to sustained competitive advantage as articulated
by the resource-based theory of the firm.

The characteristics of resources that can lead to sustained competitive advantage as per
the resource based theory of the firm are –

Value of the Resources

Rareness of the Resources

Imitation and Substitution Risks associated with the resources.

Organizational Competence to exploit the maximum out of those resources.

How VRIO is Reshaping Business Strategies

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For industry specific report please feel free to email us or buy a custom report on - "How
VRIO is Reshaping Business Strategies"

5C Marketing Analysis of Hindustan Unilever Limited

4P Marketing Analysis of Hindustan Unilever Limited

Porter Five Forces Analysis and Solution of Hindustan Unilever Limited

Porter Value Chain Analysis and Solution of Hindustan Unilever Limited

Case Memo & Recommendation Memo of Hindustan Unilever Limited

Blue Ocean Analysis and Solution of Hindustan Unilever Limited

Marketing Strategy and Analysis Hindustan Unilever Limited

VRIO /VRIN Analysis & Solution of Hindustan Unilever Limited

PESTEL / STEP / PEST Analysis of Hindustan Unilever Limited

Case Study Solution of Hindustan Unilever Limited

SWOT Analysis and Solution of Hindustan Unilever Limited

Balanced Scorecard Solution of Hindustan Unilever Limited

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