BUSI1633

Strategy for Managers

Week 5: Resources and Capabilities

VRIO Framework
What we will do today:
• Recap: VRIO
• Valuable
• Rare
• Imitability
• Organisation
• Consider Student Application of VRIO to TikTok
• Practice the Application of VRIO to Practice Case Study
Assessing Resources & Capabilities:
VRIO Framework
• A strategic analysis tool used to evaluate a company’s resources
and capabilities.
• Helps determine which resources provide a competitive
advantage — and whether that advantage can be sustained over
time.
• Encourages firms to look beyond external factors (like
competitors or markets) and assess their internal strengths.
VRIO: Valuable
Key question: Does the resource help the firm exploit
opportunities or neutralize threats?

• Adds value to products, services, or processes.

• Improves efficiency or effectiveness.
• Without value → the resource is a weakness, not a strength.

Example: A brand reputation that attracts loyal customers.

VRIO: Rare
Key question: Is the resource unique or possessed by few
competitors?

• Rare resources create temporary competitive advantage.

• Common or widely available resources only lead to parity.

Example: Exclusive technology, unique cultural heritage, or niche

expertise.
VRIO: Imitable
Key question: Is it difficult or costly for competitors to imitate?

• Can stem from unique history, complex culture, or tacit

knowledge.
• If easily copied, the advantage won’t last.

Example: Apple’s design culture or decades of brand storytelling.

VRIO: Organisation
Key question: Is the firm structured to capture value from the
resource?

• Requires proper systems, processes, and leadership.

• Even great resources fail without organization.

Example: A skilled workforce supported by strong management

and training systems.
 Did you try to apply a
VRIO Framework to the
brand:

What did you find?

Resources / Competitive
Value Rarity Imitability Organization
Capabilities Implication
Delivers highly
Hard to copy due ByteDance is
Recommendation personalized, Proprietary Sustained
to data advantage structured to exploit
Algorithm (For You addictive content that algorithm and data Competitive
and machine learning data and refine the
Page) drives engagement scale are rare Advantage
sophistication algorithm
and ad revenue
Supported
Global Creator Fuels continuous Distinctive social Community Sustained
through Creator
Community & Viral content generation culture and meme culture hard to Competitive
Fund, challenges,
Culture and trend creation ecosystem replicate authentically Advantage
and platform tools
Short-form Video Matches user Common format
Format & Creation preference for quick, (copied by Reels, Competitive Parity
Tools visual entertainment Shorts, etc.)
Monetization Common in
Generates Temporary
Systems (Ads, concept, but Moderate
diversified revenue Competitive
TikTok Shop, execution is imitation difficulty
streams Advantage
Creator Fund) advanced
Boosts
Localized Content Can be replicated Temporary
engagement and Somewhat rare at
Strategy (Global + but resource- Competitive
regulatory this scale
Regional Teams) intensive Advantage
compliance
Let’s Practice Together
• Apply VRIO to your practice
case study Air India
Express/Byton
• First, identify 4/5 resources for
the company
• Second, apply the VRIO
framework using the table on
the right to help you
• You may work in groups, and
we will discuss together
afterwards
Resources / Competitive

Byton
Value Rarity Imitability Organization
Capabilities Implication
Experienced
Unused
executive team
✘ Competitive
from BMW and
Advantage
global firms

Cutting-edge
Temporary
product innovation
✘ Competitive
(M-Byte smart EV
Advantage
design)

Prestigious supplier
Temporary
partnerships
✘ Competitive
(Bosch, Dürr,
Advantage
Deloitte)

Global operations
and high-cost Competitive
✘
international Disadvantage
structure

Brand positioning
as a luxury “Tesla of ✘ Competitive Parity
China” startup
 Air India Express
Resources / Competitive
Value Rarity Imitability Organization
Capabilities Implication

Low-cost Temporary
international ✘ Competitive
business model Advantage

Parent company
Sustained
support from Air
Competitive
India (brand &
Advantage
infrastructure)

Point-to-point Temporary
connectivity to ✘ Competitive
tier-2 cities Advantage

Adoption of Radixx
digital reservation ✘ Competitive Parity
system

Improved service
reliability and
✘ Competitive Parity
customer
satisfaction
What did we do today:
• Recap: VRIO
• Valuable
• Rare
• Imitability
• Organisation
• Consider Student Application of VRIO to TikTok
• Practice the Application of VRIO to Practice Case Study
Next week
Next week:
Bringing it all together: SWOT and TOWS

Please attend all classes on your timetable.

Suggestion: Bring a laptop/tablet to our tutorial
Thank you!