VRIO Analysis of The Kashagan Production Sharing Agreement PSA

Posted by Zachary Edwards on Mar-22-2018

The VRIO Analysis of The Kashagan Production Sharing Agreement PSA will look at each of its internal resources one by one to assess whether these provide sustained competitive advantage. The The Kashagan Production Sharing Agreement PSA 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 The Kashagan Production Sharing Agreement PSA VRIO Analysis shows that the financial resources of The Kashagan Production Sharing Agreement PSA are highly valuable as these help in investing into external opportunities that arise. These also help The Kashagan Production Sharing Agreement PSA in combating external threats.
• According to the VRIO Analysis of The Kashagan Production Sharing Agreement PSA, 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 The Kashagan Production Sharing Agreement PSA VRIO Analysis shows that The Kashagan Production Sharing Agreement PSA'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 The Kashagan Production Sharing Agreement PSA's products.
• According to the VRIO Analysis of The Kashagan Production Sharing Agreement PSA, its patents are a valuable resource as these allow the firm to sell its products without competitive interference. This results in greater revenue for The Kashagan Production Sharing Agreement PSA. These patents also provide The Kashagan Production Sharing Agreement PSA with licensing revenue when it licenses these patents out to other manufacturers.
• The The Kashagan Production Sharing Agreement PSA VRIO Analysis shows that The Kashagan Production Sharing Agreement PSA’s distribution network is a valuable resource. This helps it in reaching out to more and more customers. This ensures greater revenues for The Kashagan Production Sharing Agreement PSA. It also ensures that promotion activities translate into sales as the products are easily available.
• According to the VRIO Analysis of The Kashagan Production Sharing Agreement PSA, 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 The Kashagan Production Sharing Agreement PSA VRIO Analysis shows that the research and development at The Kashagan Production Sharing Agreement PSA 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 The Kashagan Production Sharing Agreement PSA. It is recommended that the research and development teams are improved, and costs are cut for these.

Rare

• The financial resources of The Kashagan Production Sharing Agreement PSA are found to be rare according to the VRIO Analysis of The Kashagan Production Sharing Agreement PSA. 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 The Kashagan Production Sharing Agreement PSA 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 The Kashagan Production Sharing Agreement PSA and inhibit competitive advantage. This means that the local food products result in competitive parity for The Kashagan Production Sharing Agreement PSA. As this resource is valuable, The Kashagan Production Sharing Agreement PSA can still make use of this resource.
• The employees of The Kashagan Production Sharing Agreement PSA are a rare resource as identified by the VRIO Analysis of The Kashagan Production Sharing Agreement PSA. 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 The Kashagan Production Sharing Agreement PSA are a rare resource as identified by the The Kashagan Production Sharing Agreement PSA VRIO Analysis. These patents are not easily available and are not possessed by competitors. This allows The Kashagan Production Sharing Agreement PSA to use them without interference from the competition.
• The distribution network of The Kashagan Production Sharing Agreement PSA is a rare resource as identified by the VRIO Analysis of The Kashagan Production Sharing Agreement PSA. This is because competitors would require a lot of investment and time to come up with a better distribution network than that of The Kashagan Production Sharing Agreement PSA. These are also possessed by very few firms in the industry.

Imitable

• The financial resources of The Kashagan Production Sharing Agreement PSA are costly to imitate as identified by the The Kashagan Production Sharing Agreement PSA 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 The Kashagan Production Sharing Agreement PSA. 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 The Kashagan Production Sharing Agreement PSA provide it with a temporary competitive advantage that competitors can too acquire in the long run.
• The employees of The Kashagan Production Sharing Agreement PSA are also not costly to imitate as identified by the The Kashagan Production Sharing Agreement PSA VRIO Analysis. This is because other firms can also train their employees to improve their skills. These companies can also hire employees from The Kashagan Production Sharing Agreement PSA by offering better compensation packages, work environment, benefits, growth opportunities etc. This makes the employees of The Kashagan Production Sharing Agreement PSA a resource that provides a temporary competitive advantage. Competition can acquire these in the future.
• The patents of The Kashagan Production Sharing Agreement PSA are very difficult to imitate as identified by the VRIO Analysis of The Kashagan Production Sharing Agreement PSA. 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 The Kashagan Production Sharing Agreement PSA is also very costly to imitate by competition as identified by the The Kashagan Production Sharing Agreement PSA VRIO Analysis. This has been developed over the years gradually by The Kashagan Production Sharing Agreement PSA. Competitors would have to invest a significant amount if they are to imitate a similar distribution system.

Organisation

• The financial resources of The Kashagan Production Sharing Agreement PSA are organised to capture value as identified by the VRIO Analysis of The Kashagan Production Sharing Agreement PSA. 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 The Kashagan Production Sharing Agreement PSA.
• The Patents of The Kashagan Production Sharing Agreement PSA are not well organised as identified by the The Kashagan Production Sharing Agreement PSA 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 The Kashagan Production Sharing Agreement PSA starts selling patented products before the patents expire.
• The distribution network of The Kashagan Production Sharing Agreement PSA is organised as identified by the VRIO Analysis of The Kashagan Production Sharing Agreement PSA. The Kashagan Production Sharing Agreement PSA 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 The Kashagan Production Sharing Agreement PSA.

From the VRIO Analysis of The Kashagan Production Sharing Agreement PSA, 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 The Kashagan Production Sharing Agreement PSA is a competitive disadvantage. Research and Development is also a competitive disadvantage.