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VRIO

VRIO is an acronym for the four question framework an analyst should ask about a resource or capability to determine its competitive potential: 1) a question of value, 2) a question of rarity, 3) aquestion of Imitability, e.g., ease/difficulty to imitate the capability, and 4) a question of Organization, e.g. an ability to exploit the resource or capability.

The Question of Value: "Is the firm able to exploit an opportunity or neutralize an external threat with the resource/capability?"

The Question of Rarity: "Is control of the resource/capability in the hands of a relative few?"

The Question of Imitability: "Is it difficult to imitate, and will there be significant cost disadvantage to a firm trying to obtain, develop, or duplicate the resource/capability?"

The Question of Organization: "Is the firm organized, ready, and able to exploit the resource/capability?"




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