Case Study Solution of Uber: An Empire in the Making? For example, Cokes brand name is valuable but most of Cokes competitors (Pepsi, 7Up, RC) also have widely recognized brand names, making it not that rare. Another extension of VRIO analysis is VRIN where N stands non substitutable. According to the VRIO Analysis of Uber . Barney, J. These are also possessed by very few firms in the industry. To build a sustainable competitive advantage the resources that -casename needs to be valuable, rare, and difficult to imitate. We make the greatest data maps. Key partners Who are Uber's key partners? on WhatsApp for any queries. For industry specific report please feel free to email us or buy a custom report on - "How VRIO is Reshaping Business Strategies", M. E. Porter, Competitive Strategy(New York: Free Press, 1980) The Uber VRIO Analysis shows that the financial resources of Uber are highly valuable as these help in investing into external opportunities that arise. Competitors would have to invest a significant amount if they are to imitate a similar distribution system. The Federal Communications Commission in April 2019 announced its third and largest auction for fifth generation networks that promise a major speed increase for downloading data over cellular networks. A valuable and rare resource or capability will grant a competitive advantage as long as other firms do not gain subsequent possession of the resource or a close substitute. 9) VRIO stands for - Value of the resource, Rareness of the resource, Imitation Risk, and Organizational Competence. (1991). B. It is said that the competitive advantage of a company rests on the heterogeneity of its resources, which should differentiate a company. Rareness: Uber's huge financial ability is rare since only few companies can have high market capitalization. The patents are a source of unused competitive advantage. VRIO analysis can help organizations such as Uber to do better resource allocation and build a defensible value and supply chain. Why dont competitors have similar people? Can provide Uber sustainable competitive advantage. (1984). 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 four components of VRIO used in Uber vs. Didi: The Race for China's Ride-hailing Market analysis are -. The financial resources of Uber are costly to imitate as identified by the Uber VRIO Analysis. Most of the competitors are trying to enter the lucrative segments, 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, Yes, as it diversify the revenue streams and isolate company's balance sheet from economic cycles, Can be imitated by competitors of Uber but at a relatively high cost, Yes, it is one of the most diversified companies in its industry, Sales Force and Channel Management of Uber, Still there is lot of potential to utilize the excellent sales force. If you have BIG dreams to score BIG, think out Tangible resources of Uber Disruptive include - physical entities, such as land, buildings, plant, equipment, inventory, and money. VRIO framework is the tool used to analyze firm's internal resources and capabilities to find out if they can be a source of sustained competitive advantage. Check out the SWOT analysis of Uber. Porter Value Chain Analysis and Solution of Uber: An Empire in the Making? Thank you for your email subscription. HBR Case Study Solution, A valuable and rare resource can provide a competitive advantage to Uber for certain period of time as all the competitors are going to try to imitate or replicate that resource. This is because other firms can also train their employees to improve their skills. Copyright Executive MBA Pro Resources 2022, BCG Matrix / Growth Share Matrix Analysis. How rare do the resources need to be for a firm to have a competitive advantage? To conduct a resource-based analysis of a business, Barney (1991) proposes a structured approach based on analysing whether a resource is valuable, rare and imitable and whether the organisation is taking advantage of the resource. The local food products are not that costly to imitate as identified by the VRIO Analysis of Uber. VRIO analysis of Uber Ride is a resource oriented analysis using the details provided in the Uber: Managing a Ride in China case study. These are also valued more than the competition by customers due to the differentiation in these products. The financial resources of Uber are found to be rare according to the VRIO Analysis of Uber. For instance, Toyota and Honda both have the capabilities to build cars of high quality at relatively low cost. According to the data provided in Uber: An Empire in the Making? Log in Join. VRIO /VRIN Analysis & Solution of Uber: An Empire in the Making? Figure 1 VRIO Analysis. If Uber is not organized based on its strengths then it wont able to exploit all the resources that it possesses. Study Resources. to get Coupon Code. The trained. Accordingly, we never encourage or endorse its direct Balanced Scorecard Solution of Uber: An Empire in the Making? The case goes on to review more recent growth, outlining some of the PR issues the company has faced with respect to aggressive business practices and questions around its data privacy policies. The Fasten Challenging Uber and Lyft with a New Business Model also makes use of the VRIN/VRIO analysis frequently for developing competitive strategies that are based on the company's core strengths and resources to help it gain a competitive advantage over other players in the market. capitalization. 9, Issue 4, pp. 9, Issue 4, pp. it seems that the core differentiation of the Uber Uber's is difficult to imitate. Personal communication by Saylor.org with former executives. The company now known as RTW Retailwinds has began implementing celebrity brands, including Kate Hudson, which is now part of their core competency as they continue to expand. Assignment 4 - TOWS Analysis - complete.docx.pdf. They may be able to exploit opportunities or negate threats in ways that those lacking the resource will not be able to do. Nitro Pro 9 (9. endobj case study is a Harvard Business School (HBR) case study written by Salvatore Cantale, Sarah Hutton. . Barney, J. It also ensures that promotion activities translate into sales as the products are easily available. Personal communication by Saylor.org with Margaret Haddox. All of this translates into greater value for the end consumers of Uber's products. Organizational Competence to exploit the maximum out of those resources. Capabilities tend to arise or expand over time as a firm takes actions that build on its strategic resources. According to data gathered by Forbes, Uber's growth rate in 2014 was of one city per day. The question of organization is broad and encompasses many facets of a firm but essentially means that the firm is able to capture any value that the resource or capability might generate. View Assignment - Uber VRIO.docx from BUSINESS MBAD 502 at Nairobi Aviation College, Nairobi Branch. Feel free to connect with us if you need business research. VRIO stands for Value of the resource, Rareness of the resource, Imitation Risk, and Organizational Competence. Kotler & Armstrong (2017) "Principles of Marketing Management Management", Published by Pearson Publications. VRIO / VRIN Analysis & Solution, Jean-Claude Biver: The Reemergence of the Swiss Watch Industry, Video Supplement VRIO / VRIN Analysis & Solution, Shang Xia: Selling High-Quality Goods "Proudly Made in China" VRIO / VRIN Analysis & Solution, Yes, new niches are emerging in the market, No, as most of the competitors are also targeting those niches, Brand extensions will require higher marketing budget, Yes, as it diversify the revenue streams and isolate company's balance sheet from economic cycles, Yes, it is one of the most diversified companies in its industry, Intellectual Property Rights, Copyrights, and Trademarks, Yes, they are extremely valuable especially to thwart competition, Yes, IPR and other rights are rare and competition can't 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, Successful Implementation of Digital Strategy, Yes, without a comprehensive digital strategy it is extremely difficult to compete, No, as most of the firms are investing into digitalizing operations, One of the leading player in the industry, Digital strategy has become critical in the industry but it can't provide sustainable competitive advantage, Alignment of Activities with Uber Disruptive Corporate Strategy. Academic writing has no room for errors and mistakes. SF Express: From Delivery to E-Commerce VRIO / VRIN Analysis & Solution, Agarwal Packers and Movers: Competing for "Moving" Experiences VRIO / VRIN Analysis & Solution, Mygola.com: Deciding Its Place in the Online Travel Market VRIO / VRIN Analysis & Solution, Seeking Balance between Social Purpose and Entrepreneurship: Homeland Development Initiative Foundation (HDIF) VRIO / VRIN Analysis & Solution, The Priceline Group: Booking a Place for the Future VRIO / VRIN Analysis & Solution, Detroit: On the Right Track? You can download Excel Template of VRIO / VRIN Analysis & Solution of Uber: Changing The Way The World Moves, Copyright Executive MBA Pro Resources 2022, BCG Matrix / Growth Share Matrix Analysis, 5C Marketing Analysis of Uber: Changing The Way The World Moves, 4P Marketing Analysis of Uber: Changing The Way The World Moves, Porter Five Forces Analysis and Solution of Uber: Changing The Way The World Moves, Porter Value Chain Analysis and Solution of Uber: Changing The Way The World Moves, Case Memo & Recommendation Memo of Uber: Changing The Way The World Moves, Blue Ocean Analysis and Solution of Uber: Changing The Way The World Moves, Marketing Strategy and Analysis Uber: Changing The Way The World Moves, VRIO /VRIN Analysis & Solution of Uber: Changing The Way The World Moves, PESTEL / STEP / PEST Analysis of Uber: Changing The Way The World Moves, Case Study Solution of Uber: Changing The Way The World Moves, SWOT Analysis and Solution of Uber: Changing The Way The World Moves, Balanced Scorecard Solution of Uber: Changing The Way The World Moves, Bridj and the Business of Urban Mobility (A): Introducing a New Model VRIO / VRIN Analysis & Solution, Deutsche Bahn AG: The heartless train conductor VRIO / VRIN Analysis & Solution, Note on the Canadian Transportation Industry VRIO / VRIN Analysis & Solution, The Indian Railways 'Cash Cow' - Profits or Safety? This sustainable competitive advantage can help Uber Disruptive to enjoy above average profits in the industry and thwart competitive pressures. 5. The patents of Uber Makes a Smart Bet with Uber Eats are a rare resource as identified by the Uber Makes a Smart Bet with Uber Eats VRIO Analysis. Value: Uber has a valuable financial resources that can be used in investment externally. View According to the data provided in Uber: Changing The Way The World Moves it seems that the core differentiation of the Uber Disruptive is difficult to imitate. It's often deemed cheaper than taxis and easier to schedule an appointment. (1995) "Looking Inside for Competitive Advantage". Dyer, J. H., & Hatch, N. (2004). Table 1: Uber's VRIO Analysis Resource Valuable V Brand Image Yes Customer Yes Service Supply. Do better resource allocation and build a defensible Value and supply chain 's products differentiation. 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