Universitas Pelita Bangsa Fakultas Ekonomi, Bisnis & Ilmu Sosial Program Studi Magister Manajemen
Universitas Pelita Bangsa Fakultas Ekonomi, Bisnis & Ilmu Sosial Program Studi Magister Manajemen
Universitas Pelita Bangsa Fakultas Ekonomi, Bisnis & Ilmu Sosial Program Studi Magister Manajemen
Background
The background of this journal is understanding the relationship between the resources they control
and the performance of the firm is one of the critical strategic analysis tasks for managers.
Although it has diffused widely in the literature, it is not clear that VRIO has had as much impact
on managerial practice. Surveys of managers tend to refer instead to core competencies or
competence analysis. (Rigby and Bilodeau, 2007; Hodgkinson et al., 2006), and an interview-based
study (Knott, 2008) suggests that few of these cases involve formal analysis. Teaching experience
suggests that there are practical difficulties in translating RBV theory into application guidelines
and in linking analysis and action. In response to these apparent shortcomings, this paper
investigates the VRIO technique’s merits and limitations when non-specialist practitioners use it to
analyse a firm’s resources.
Purpose of Journal Writing
Following recent interest in the use of strategy tools, the purpose of this paper is to focus on what
happens when VRIO informs strategy action. This paper investigates the VRIO technique’s merits
and limitations when non-specialist practitioners use it to analyse a firm’s resources.
UNIVERSITAS PELITA BANGSA
FAKULTAS EKONOMI, BISNIS & ILMU SOSIAL
PROGRAM STUDI MAGISTER MANAJEMEN
Method
While the method used by the author to analyze the following events, namely by using
experimental method to compare analysis that uses VRIO with analysis that does not. Systematic
coding of the responses evaluates how users select resources to evaluate, in which areas they make
recommendations, and what account they take of competitors, dynamic evolution, and resource
disadvantages, risks and limitations.
Research Results
The common thread that can be taken from the results of this study is, VRIO encouraged users to
evaluate resources relative to competitors and competitive dynamics, but resource selection
difficulties and failure to evaluate resource disadvantages limited its value. In addition, it drew
users to the existing operations and business model. This is obtained from the hypothetical results
UNIVERSITAS PELITA BANGSA
FAKULTAS EKONOMI, BISNIS & ILMU SOSIAL
PROGRAM STUDI MAGISTER MANAJEMEN
in table
H3. Users of VRIO are more likely than non-users to cite risks, limitations, or sources of
competitive disadvantage associated with firm attributes.
H4. Users of VRIO are more likely than non-users to assess the dynamic evolution of markets and
competition.
H5a. Users of VRIO are less likely than non-users to make strategy recommendations that are
distinct from the existing business model.
H5b. Users of VRIO will make recommendations in different strategic aspects of the firm than
non-users
Conclusion
The conclusion obtained by the author is, this paper continues the established line of inquiry into
strategy tools in use. Its contribution is to articulate the effects, efficacy, and limitations of the
VRIO method when used to analyse a firm’s resources. The results complement previous research.
Systematic analysis using NVivo coding shows that VRIO works as designed in some respects,
such as evaluation relative to evolving competition, but in other respects does not realise its
potential. . It could be improved by specifying more carefully what kind of resources users should
evaluate and taking more account of limitations and potential negatives associated with firm
attributes. Because it focuses attention on pre-existing operations, it would not be a good starting
point for firms seeking to move beyond an existing business model or strategy paradigm.
The advantage of this research that has been done is, in the process of processing data using
NVIVO because it has the advantage of being able to process a large amount of data, varied data
UNIVERSITAS PELITA BANGSA
FAKULTAS EKONOMI, BISNIS & ILMU SOSIAL
PROGRAM STUDI MAGISTER MANAJEMEN
sources, no need for a matrix, with detailed transcripts. Only a small number of published studies
evaluate VRIO as a method of practical strategic analysis, and this paper is the first to look directly
at users’ responses
While the drawback is, the study also suggests that shortcomings in the application of VRIO by
non-specialists limit its value. users require guidance as to what kinds of attribute they should
evaluate as resources, as noted above. In the absence of guidance, they often evaluate outcomes or
strategies as if they are resources, leading to circular reasoning. They also often fail to be
evaluative about resources by considering their limitations, downsides, or risks.
The lack of thought flow diagrams also makes the reader have to guess the hypotheses that exist
into the image in wishful thinking.