VRIO Analysis of TrustCo Bank Corp NY

Posted by Zachary Edwards on Mar-22-2018

The VRIO Analysis of TrustCo Bank Corp NY will look at each of its internal resources one by one to assess whether these provide sustained competitive advantage. The TrustCo Bank Corp NY VRIO Analysis also mentions at each stage whether these resources could be improved to provide a greater competitive advantage. Lastly, the resources analysed are summarised as to whether they offer sustained competitive advantage, has an unused competitive advantage, temporary competitive advantage, competitive parity or competitive disadvantage.

Valuable

• The TrustCo Bank Corp NY VRIO Analysis shows that the financial resources of TrustCo Bank Corp NY are highly valuable as these help in investing into external opportunities that arise. These also help TrustCo Bank Corp NY in combating external threats.
• According to the VRIO Analysis of TrustCo Bank Corp NY, its local food products are a valuable resource as these are highly differentiated. This makes the perceived value for these by customers high. These are also valued more than the competition by customers due to the differentiation in these products.
• The TrustCo Bank Corp NY VRIO Analysis shows that TrustCo Bank Corp NY's employees are a valuable resource to the firm. A significant portion of the workforce is highly trained, and this leads to more productive output for the organisation. The employees are also loyal, and retention levels for the organisation are high. All of this translates into greater value for the end consumers of TrustCo Bank Corp NY's products.
• According to the VRIO Analysis of TrustCo Bank Corp NY, its patents are a valuable resource as these allow the firm to sell its products without competitive interference. This results in greater revenue for TrustCo Bank Corp NY. These patents also provide TrustCo Bank Corp NY with licensing revenue when it licenses these patents out to other manufacturers.
• The TrustCo Bank Corp NY VRIO Analysis shows that TrustCo Bank Corp NY’s distribution network is a valuable resource. This helps it in reaching out to more and more customers. This ensures greater revenues for TrustCo Bank Corp NY. It also ensures that promotion activities translate into sales as the products are easily available.
• According to the VRIO Analysis of TrustCo Bank Corp NY, its cost structure is not a valuable resource. This is because the methods of production lead to greater costs than that of competition, which affects the overall profits of the firm. Therefore, its cost structure is a competitive disadvantage that needs to be worked on.
• The TrustCo Bank Corp NY VRIO Analysis shows that the research and development at TrustCo Bank Corp NY is not a valuable resource. This is because research and development are costing more than the benefits it provides in the form of innovation. There have been very few innovative features and breakthrough products in the past few years. Therefore, research and development are a competitive disadvantage for TrustCo Bank Corp NY. It is recommended that the research and development teams are improved, and costs are cut for these.

Rare

• The financial resources of TrustCo Bank Corp NY are found to be rare according to the VRIO Analysis of TrustCo Bank Corp NY. Strong financial resources are only possessed by a few companies in the industry.
• The local food products are found to be not rare as identified by TrustCo Bank Corp NY VRIO Analysis. These are easily provided in the market by other competitors. This means that competitors can use these resources in the same way as TrustCo Bank Corp NY and inhibit competitive advantage. This means that the local food products result in competitive parity for TrustCo Bank Corp NY. As this resource is valuable, TrustCo Bank Corp NY can still make use of this resource.
• The employees of TrustCo Bank Corp NY are a rare resource as identified by the VRIO Analysis of TrustCo Bank Corp NY. These employees are highly trained and skilled, which is not the case with employees in other firms. The better compensation and work environment ensure that these employees do not leave for other firms.
• The patents of TrustCo Bank Corp NY are a rare resource as identified by the TrustCo Bank Corp NY VRIO Analysis. These patents are not easily available and are not possessed by competitors. This allows TrustCo Bank Corp NY to use them without interference from the competition.
• The distribution network of TrustCo Bank Corp NY is a rare resource as identified by the VRIO Analysis of TrustCo Bank Corp NY. This is because competitors would require a lot of investment and time to come up with a better distribution network than that of TrustCo Bank Corp NY. These are also possessed by very few firms in the industry.

Imitable

• The financial resources of TrustCo Bank Corp NY are costly to imitate as identified by the TrustCo Bank Corp NY VRIO Analysis. These resources have been acquired by the company through prolonged profits over the years. New entrants and competitors would require similar profits for a long period of time to accumulate these amounts of financial resources.
• The local food products are not that costly to imitate as identified by the VRIO Analysis of TrustCo Bank Corp NY. These can be acquired by competitors as well if they invest a significant amount in research and development. These also do not require years long experience. Therefore, the local food products by TrustCo Bank Corp NY provide it with a temporary competitive advantage that competitors can too acquire in the long run.
• The employees of TrustCo Bank Corp NY are also not costly to imitate as identified by the TrustCo Bank Corp NY VRIO Analysis. This is because other firms can also train their employees to improve their skills. These companies can also hire employees from TrustCo Bank Corp NY by offering better compensation packages, work environment, benefits, growth opportunities etc. This makes the employees of TrustCo Bank Corp NY a resource that provides a temporary competitive advantage. Competition can acquire these in the future.
• The patents of TrustCo Bank Corp NY are very difficult to imitate as identified by the VRIO Analysis of TrustCo Bank Corp NY. This is because it is not legally allowed to imitate a patented product. Similar resources to be developed and getting a patent for them is also a costly process.
• The distribution network of TrustCo Bank Corp NY is also very costly to imitate by competition as identified by the TrustCo Bank Corp NY VRIO Analysis. This has been developed over the years gradually by TrustCo Bank Corp NY. Competitors would have to invest a significant amount if they are to imitate a similar distribution system.

Organisation

• The financial resources of TrustCo Bank Corp NY are organised to capture value as identified by the VRIO Analysis of TrustCo Bank Corp NY. These resources are used strategically to invest in the right places; making use of opportunities and combatting threats. Therefore, these resources prove to be a source of sustained competitive advantage for TrustCo Bank Corp NY.
• The Patents of TrustCo Bank Corp NY are not well organised as identified by the TrustCo Bank Corp NY VRIO Analysis. This means that the organisation is not using these patents to their full potential. An unused competitive advantage exists that can be changed into a sustainable competitive advantage if TrustCo Bank Corp NY starts selling patented products before the patents expire.
• The distribution network of TrustCo Bank Corp NY is organised as identified by the VRIO Analysis of TrustCo Bank Corp NY. TrustCo Bank Corp NY uses this network to reach out to its customers by ensuring that products are available on all of its outlets. Therefore, these resources prove to be a source of sustained competitive advantage for TrustCo Bank Corp NY.

From the VRIO Analysis of TrustCo Bank Corp NY, it was identified that the financial resources and distribution network provide a sustained competitive advantage. The patents are a source of unused competitive advantage. There exists a temporary competitive advantage for employees. There exists a competitive parity for local food products. Lastly, the cost structure of TrustCo Bank Corp NY is a competitive disadvantage. Research and Development is also a competitive disadvantage.