VRIO framework is a business analysis framework which was developed in 1991 by Jay Barney in his work “Firm Resources and Sustainable Competitive Advantage”.  VRIO is acronym of Value, Rarity, Inimitable, and Organization. This framework explains organization’s competitive advantage.  When a firm is in a position to differentiate its product/service from its competitors it is said to be a competitive advantage. To gain and maintain a competitive advantage, an organization must be able to demonstrate differential value than its competitors and convey that information to its desired target market. J. B. Barney’s original framework was called VRIN; he called it VRIO by improvising the original VRIN.

VRIO falls into the internal analysis step of the strategic procedures, and is used as a framework in evaluating just about all resources and capabilities of a firm, not considering what phase of the life cycle the firm is passing through.

Value (V): The definition of value is whether or not the resource or capability of the firm is able to exploit opportunities? is the firm in a position to mitigate threats in the marketplace? If it does do one of those two things, it can be considered strength of the company. However, if it does not work to exploit an opportunity or mitigate a threat, it is said to be a weakness. Occasionally, some resources or capabilities could be considered strengths in one industry and weaknesses in a different one. The concept of value must clarify whether the firm attempts to exploit technological change, demographic change, cultural change, economic climate, and specific international events, legal and political conditions. Further, five threats that a resource or capability could mitigate are: the threat of buyers, threat of suppliers, threat of new entrants, threat of rivalry and threat of substitutes. These are explained by Prof. Michel Porter in his five forces model.

Rarity (R): Having an exceptional or uncommon capability in a firm can lead to competitive advantage. Rarity is when a firm has a valuable resource or capability that is absolutely unique among a set of current and potential competitors. A firm’s resources and capabilities must have both short supply and persistence over time which means the product must have good circulation cycle and must be persistently in demand. Dark Matter’s Katim phone is the world’s most secure smartphone. It runs a heavily customized version of Android. At every boot instance, the device checks the complete software stack to detect modifications. It aborts the boot up if the validation fails. It constantly monitors the phone and data. If it detects a malware or security attack trying to bypass its security mechanisms, it cleans up the entire phone. This is rarity.

Inimitability (I):  The primary object of “imitability” in the VRIO framework is whether a firm with valuable and rare resources makes it difficult to imitate its product and services by other firms. It also helps a firm to be leader in the market and helps to gain the first-mover advantages in the market and can hence gain competitive advantage. For example, no competitors of Starbucks have been able to gain a large global presence; Starbucks has presence in 75 countries and has over 24,000 coffee shops. It would take significant time and resources to accomplish this.

A competitive advantage is gained when the imitability becomes difficult to copy. Sometimes it is hard for other firms to get access to the resources and imitate the innovative company’s strategy. As a result, it is difficult to imitate and implement products and services which are costly-to-imitate; the cost of imitation, time for imitation, forms of imitation all matter.

Organization (O): Resource management is called efficient and effective when they are available in time and are economical. Such resources may include financial resources, inventory, human skills, production resources, or information technology (IT) and natural resources. When an organization acquires value, rarity and imitability, the next step is to systematize utilization of its resources. If done successfully, the company can enjoy a period of sustained competitive advantage.

Few components such as the company’s formal reporting structure, management control systems and compensation policies matter in sustaining competitive advantage. Formal reporting structures are simply a description of who in the firm reports to whom. Management control systems include both formal and informal means to make sure that managers’ decisions align with a firm’s strategies. It involves budgeting, timing and reporting activities that keep top management informed of decisions made by employee’s lower down in the firm. Informal controls can include a company’s culture and encouraging employees to monitor each other.

A good VRIO example: Google is one of the most powerful companies in the world, and its success stems from a sustained competitive advantage in human capital management. If we were to do Google’s VRIO framework it might look something like this:

Value – Google uses human capital management data to hire and retain innovative, productive employees. These employees consistently create some of the most popular consumer products and services in the world.

Rarity – no other companies are using data-based employee management broadly; data-based human capital management is both costly and difficult to imitate, at least in the near future.

Imitability – The HR software of Google relies on techniques of usage of the software which requires in-depth training which is unfeasible for competitors to copy.  Imitability therefore is out of question.

Organization – Google’s ever-changing approach and its style of doing business is unique. Its rich culture provides employees with a sense of contributing to the worldwide population. Google employees positively impact society with the applications and technology on which they are working.

Functional Value is what an offer does; it’s the solution an offer provides to the customer.

Monetary Value is whether the function of the price paid is relatively comparable to perceived worth of a product. This value invites a trade-off between other values and monetary costs.

Social Value is the extent to which owning a product or engaging in a service allows the consumer’s connect with others.

Psychological Value is the extent to which a product allows consumers to express themselves or feel better.

The biggest challenge for a firm therefore is for delivering value to their customers, they must consider what they are offering the customers. The perceived value of a brand includes the reputation of the organization, staff representation, product benefits, and technological characteristics as compared to competitors’ market offerings and prices. Value can thus be defined as the relationship of a firm’s market offerings to those of its competitors. Marketers must therefore get in the consumer’s shoes, then observe, listen and understand how they think, act, feel and behave. The fact is customers don’t always express in words what they expect from a brand; they have many innate or instinctive desires which they are unable to express always. They have their own fears, complexes, frustrations, ambitions and desires which they can rarely explain.

For example, if you are starving in the afternoon and need to have a quick bite and you pass by a food stall where you see various types of ready-made sandwiches in the window. What will make you buy one of them? You purely go by the looks of the sandwich? Will you buy a whole grain bread sandwich or the organic ingredients? While your hunger drives the initial buying behaviour (the benefit), there are other, more subtle, components to selecting one sandwich from the assortment: the freshness, aroma, the tossing used in it, the size, shape, butter/mayonnaise layer, whether your want a toasted sandwich or plain…. As customers, our needs are layered and complex and marketers must primarily identify consumer needs, and then ensure benefits which will fulfil those needs and features that offer advantage.

In another example, if you are travelling with your friends to a hilly destination in rainy season, on the way you all stop at tea stall for having piping hot tea, and you hear one of the nostalgic songs on the radio with your friends. All of you love the song, and it brings back some old memories, the tea becomes ‘valuable,’ though it may just cost ₹ 5/- each cup. The atmosphere, the feeling, togetherness with friends, rains everything adds to the value of a cup of tea.

Value in marketing is defined by both qualitative and quantitative measures. On the qualitative side, value is the perceived in terms of individual’s emotional, mental and physical condition plus various social, economic, cultural and environmental factors. On the quantitative side, value is actually counted in terms of how much amount the customer spent to buy the good/service which includes his cost of time.

Perceived customer value is marketing and branding related concept which indicates that success of a product is largely based on whether customers believe it can satisfy their needs or not. When marketers devise promotional strategies, they must understand that customers ultimately determine and interpret and react to marketing messages based on their experience of life. Therefore, companies spend significant time researching the market to get a sense of how customers think and feel. Satisfaction is a person’s feelings of pleasure or disappointment resulting from comparing a products performance in relation to the person’s previous experience and expectations of performance. Most expectations are derived from past buying experiences: opinions of friends and peers, reputation of marketer, available substitutes, and promises made by marketers, and performance.

The USP of Indigo Airlines is ‘’On Time Performance, Lowest Price” India is becoming one of the fastest growing aviation industries in the world. Because of the introduction of no frills air services, low cost air services are catching up fast. The air tickets are comparable with the railway tickets literally. Some of the factors that have resulted in higher demand for air transport in India include the growing purchasing power of middle class, low airfares offered by low cost carriers and the growth of the tourism industry.

Indigo is a no-frills carrier, but insists on reaching its passengers to their destination in time. The airline is at number one in India at the moment, because its customers are experiencing consistency in their services of reaching destination in time.  It outsources in-flight catering/eatables from an outside vendor. These are presented to customers on payable basis. This strategy is helping the airline in keeping the cost of operation low and passing on the benefits to end customers. In 2015, a survey conducted for ranking various airlines, Indigo scored highest ranking in most parameters but vitally on these two: time taken to deliver baggage & In-cabin maintenance. On the factors of ‘value for money’ and ‘on-time performance’ Indigo stood out as a winner.

Marketers must realise a fact that a person is twice as likely to tell others about a negative product or experience as they are about a good product or positive experience. Dissatisfied customers can also have a negative impact on employee morale.

Value Proposition: To comprehend customer’s perceived value, marketers must understand value proposition. A value proposition is a comparison of the benefits offered by a company’s product to its customers in relation to its price it asks customers to pay. Companies usually influence the value proposition in some ways: they use long-term brand building advertising to emphasize key traits of the brand and products. And, they can also offer a relatively low price to enhance value. Ultimately, the key is that customers perceive the product’s merits exceedingly to justify its price.

For example, Hindustan Unilever promotes diverse ideas of beauty of women through their soap brand Dove. The campaign talks what beauty is all about. Confidence, career, self-reliance, education, power, multi-tasking, self esteem all of this makes a woman more beautiful. Dove commercial always promotes the real worth of women power. Their latest advertisement in India is no different. This advertisement brings out the fact that in a anthropologically diverse country like India, there cannot be one standard of female beauty. The ad is appealing to the women folk so much that Dove is one of the most admired soap brands! Unilever is pragmatic and knows the country’s cultural roots. India is experiencing a real movement towards female empowerment, and that is captured in their ad.

Marketing Research: Media plays major role all over world. Companies who understand that they must touch the pulse of customers focus on research. It is critical to understand how certain types of customers will respond to certain messages and therefore choosing the right media vehicle becomes crucial. Smart companies use focus groups, surveys and test markets, along with other research tools, to get a sense for what customers want and do not want from products in a given industry.

Right messaging: To influence value perceptions, companies try to deliver messages indicated by their marketing research, which would create desired sense of value with customers. Smart companies understand that they need to connect with their customers regularly. They therefore, express messages such as best quality, best service, unique features or environmentally friendly continuously. To influence the customer value perception, marketing messages must be consistent. The real crux of marketing campaign is to reach the right audience with the right message at the right time. And, in the digital marketing sphere, there is nothing called as a single and a big. Digital marketing campaign has a far and wide reach.

Strengthening value chain is key function: The basic objectives of employing value chain management in a business are to integrate communication and increase cooperation between various functions such as production, supply chain, sales, and marketing, after sales service, R&D and firm’s infrastructure. When firm’s value chains strong, quality, price, delivery time of product and after sales service helps in increasing value proposition.

We mistaken people around us so often by taking them for granted. We jump to conclusions, misunderstand somebody’s intension, insult them, hurt them and relationship reaches its sour conclusion. I always feel that discovering the advantages of association and affiliation is not difficult. All it takes is the enthusiasm to look at our relationships with others from a different perspective than we are used to. When we become complacent with our colleagues, friends, partner, children, teachers, bosses, parents, siblings and neighbors we fall into a trap. Our day after day interactions with them compel us to fit them into our ideas. If we pay close attention, and respect people for who they are and not who we want them to be, each relationship will turn out to be enriching.  In fact, we don’t know most people half as well as we believe we do.  And truly knowing someone is a big deal and takes a lifetime to know how wonderful he or she is.  Every human being is amazing and beautiful in his own unique way. It just takes a patience and candid set of eyes to see it.  The more you get to know someone, the more you will be able to look beyond their exterior and see the beauty of who they truly are.

After brief experience with others around us, the biggest mistake we all commit is searching what they don’t have rather than what they posses. A familiar routine tends to make us bored easily.

Normally, we try to estimate the value of our lives by looking at the upper class of society. We compare what they posses to the (“few”) things we have. Rather than this approach (that is leading nowhere), I recommend making oneself aware of people that have less and their unique capability to make much of less.

When people break up, it’s common to regret it. People end up relationships irrationally because they think they can do better without the relationship. Sometimes it is too little too late and people learn from their unfortunate decision. What screws a person up is trying to live up to image they create in their minds. There is no such thing as perfect, only perfect for you.

What you have now was once everything you strove to attain. Just because something becomes repetitive does not mean it needs to be replaced. Think of how lucky you are to have someone you can be completely comfortable around, that is a true gift and one that should be cherished at all times.

Appreciate all the things you have in life because you never know when that time will end. Clear the clutter inside your mind and realize what you have right now. Don’t wait until you’ve lost it to finally see how much you took it for granted. Don’t wait until you realize that without it, your foundation to make it through each day begins to crumble.

Too many times people don’t realize what they have because they are out there looking for something better. The problem is that when they do realize it, they will come crawling back. Everyone falls into the trap that the grass is always greener on the other side. People make mistakes, its part of human nature. If you really love this person it may be in both people’s best interest to give him or her chance. Sometimes space makes people appreciate things they once had. You need to make it clear that you forgive one time, and one time only, and if this is what you truly want.

However on the flip side, you can only want something when you haven’t got it. If you had it back, you would only get fed up with all the bad bits again and start wondering why you wanted it back in the first place. When you lose someone, you tend to remember the good parts, when you are with them, you tend to notice the bad parts; this is of course until you find the one you were truly meant to be with, and then the bad bits just seem endearing.

The thing is, very few people can see the impact of what they do now and how it relates to their futures. Which would you rather regret: the present, where you have no idea what is happening as it’s in real time and you haven’t the slightest idea of long-term consequences; or the past where you can take your time to see things as they were? People make mistakes and leave the things they love most. They fail to appreciate the good thing they once had and as a result will continuously regret their decision.

People constantly want something more, something new, glamour, challenging and novel but sometimes the most valuable things are what have been with us at all times. Just because something isn’t happening for you right now does not mean that it never will. Happiness will never come to those who fail to appreciate what they already have. Just like you don’t know what you have until it’s gone, you don’t know what you’ve been missing until it arrives.

The term Marketing Myopia was coined by Theodore Levitt in his research paper published in 1960 in Harvard Business Review (HBR) which suggested that businesses will succeed only if they give the customers what they want. The businesses should meet the customer’s needs, to succeed in market.  A business live and dies by its customers and marketers don’t have a whole lot of room for errors to take care of them.

Levitt appealed the marketers through his paper to have a broader view of market. He called the narrow view of marketers of not giving consideration to customer’s likes and dislikes Marketing Myopia. According to Levitt, narrow-mindedness of marketers leads to failure only. Complacency in terms of a product orientation – wherein marketers are more concerned with product quality, product precision and uniqueness of product and when all efforts go in making the product with distinct benefits, the customer direction is often lost. When marketers are infatuated with consistent product improvement and they typically believe that an ideal product will sell itself shows their shortsightedness.

Similarly, when marketers concentrate on the manufacturing process keenly to make operational efficiencies and production optimization they tend to lose the customer focus; their key objective centers on production improvement processes. This orientation was prominent during the industrial era and in the capitalism period of the 1950s.

In the 1930’s, competition had increased to a great extent; the marketer’s basic focus remained on production precision and in many segments the demand remained unfulfilled. Automatically, firms started adopting sales orientation. When marketing idea rests only on the selling of goods or services which means when marketers concentrate only on pushing sales without really bothering to offer the products and services as per customer’s requirement the marketing focus is lost.

Levitt presented his viewpoints very accurately in his famous paper titled “Marketing Myopia” that contentment of the marketers in terms of product, production and sales is a pure illusion which can cause their failure in market. In my opinion Theodore Levitt was the original Marketing Guru; because this famous paper of Levitt marked the beginning of the modern marketing movement 54 years back. The concept is based on pragmatism. The paper was based on primary data collected from the oil companies. Levitt had redefined the oil companies business as “energy business” than just petroleum selling companies. The CEO’s of oil companies then started concentrating on vision and mission with a new spectrum.

One reason for the shortsightedness is due to unpredictability of the future. While this is a justifiable concern; in spite of a whole range of sales prediction techniques available in the market, the sales cannot be forecasted precisely.  But, the other view point is that when the market changes, it offers more opportunities to marketers; though it is not easy to win the market by creating an entirely new product category. Therefore, concentrating on the offering as per the customer’s need in the initial stage is a must.

In 2007, when Microsoft launched Windows Vista, the media and the public had high expectations. So did the company, which allotted $500 million for marketing research and predicted that 50% of users would run the premium edition within two years. But the software had so many compatibility and presentation problems that even Microsoft’s most loyal customers revolted. Vista flopped, and Apple’s Mac OS X desktop operating system clicked, causing many consumers to believe that Vista had even more problems than it did. Apple’s entry at the right time when market revolted against Vista gave it advantage of prohibiting Microsoft’s monopoly to a great extent.

The elements of a product such as core of the product – the ingredients, shape, size, color, design of product, the pricing and the packing of product matters.  As the business moves through the stages of product development, in the initial stage itself an understanding of the product development strategy helps. Making a good or even superior product cannot ensure that anyone will buy it. But, understanding of market, and the understanding of what consumers want does help in positioning of the product on the right plank.

Two strong reasons for marketing myopia:

Lack of depth in understanding the target market:  Marketers must know what makes their consumers buy their product. Which problems of their consumers need to be solved? Understanding the perceptions of the consumers helps in designing the products.  This is not an easy task with most products. When products fail, it is difficult to pinpoint which customers’ i.e which segment caused its failure. It implies ‘everyone’, which in fact means no-one. ‘Everyone’ includes the entire distribution approach, promotional strategy and the after sales service strategy. For example, if the product is a medical product, then the chain includes the channel partner who sells the product, the hospital that buys it, the doctors who uses it and the patients who benefit from it. All of them are involved in failing the product. They are all involved, but each must be considered independently while deciding the strategy. All of these players have different needs. Each player’s need requires to be understood. A detailed dialogue with each one and a detailed observation of each one will make the job easy.

Often marketing research is skewed when questions are not asked pin pointedly. When questionnaire is administered with blurred objectives the intent gets misunderstood. New products can take on a life of their own within an organization, becoming so hyped that there’s no turning back. Coca-Cola’s C2 (diet Coke) brand was a failure because of the fact that C2’s benefits weren’t distinctive enough. Coca-Cola identified a new market: 20 to 40 years old men who liked the taste of Coke excluding its calories and carbs and liked the no-calorie aspect of Diet Coke but they did not like its feminine image. C2, which had half the calories and carbs and all the taste of original Coke, was introduced in 2004 with a whooping $50 million advertising campaign. But, the product failed miserably due to skewed understanding of what customers really wanted. The budget couldn’t overcome rejection of the hybrid drink; the customers wanted full flavor with no calories or carbs, not half the calories and carbs. Friends, but the low-carb trend was short-lived. Positioning a product to leverage a fad is most common mistake made by marketers.

Absence of value proposition in pricing: The exercise on pricing process by which a company adds value to a product or service includes designing of product, production, distribution, marketing, and the provision of after-sales service. The pricing is also based on how each participant is going to make money from the product and what precision each of them is going to lend in making the product valuable for the final consumer.  This should be a formal process with a spreadsheet that quantifies the value proposition and commercial model. In 2004 P&G launched a scent “player” that looked like a CD player and emitted scents (contained on $5.99 discs with names like “Relaxing in the Hammock”) every 30 minutes. The company hired the singer Shania Twain for its launch commercials. This confused consumers, many of whom thought the device involved both music and scents, and the ambiguity caused failure of the product.

P&G lost heavily even because of its ambiguous pricing: hiring the celebrity singer, the advertisement campaign, the channel partner’s cost everything.  When a product is truly revolutionary, it requires a special handling. A strong educational campaign of how to use the product perhaps would have helped in boosting the sales of the product. The pricing of the product was randomly misunderstood by the consumers.

There are umpteen cases of product failures and product success; the fact remains that an organization needs to select and develop a product as per its target market’s taste, determine right price, select the ideal distribution channel to reach the place and develop and implement the right promotional strategy.

Organizations can avoid becoming myopic by listening to what the customers are saying; never stop evolving. Be mindful of new trends and remember those trends may live for long or die shortly. Keep adding new products to portfolio – practice self cannibalization, by doing so, they can enjoy bigger market share by gaining fresh frontiers. Listen to experts – be updated about new trends, new development on Internet – websites, blogs, micro blogs and industry analysis.

The other day, I had gone with a friend of mine for a painting exhibition of teenagers. As we stood before a painting titled as “Winning Energy,” which was an awesome abstract painting by a young girl of 13, we both were struck by the brilliance of it. It was a painting portraying a galloping horse; the colors, the expression, the energy and the milieu – everything was awesome. Every detail in the painting stood out and it simply showed the strength of the young painter. My friend and I immediately wrote our remarks in the space provided for visitors. While writing my remarks, I heard another lady speaking some unwanted things about the artist, about her background and her parents. The lady was quite loud. Like me, many other visitors did not appreciate the lady’s remarks.

Is it so difficult to appreciate somebody’s good work? As a society are we so narrow-minded to value good work? Why do people criticize and snub others’ great works – we cannot appreciate other’s good work, good deeds when we are jealous of them. Many times we do not appreciate others due to some petty and insignificant reasons, and trust me; it is our own weakness of not recognizing the goodness in others. Even if we don’t appreciate good work, there are millions of people to appreciate and support those who are doing something good for the society. There are some great artists, physicians, scientists, architects, lawyers, writers, journalists, politicians, and philanthropists who are doing good work and making our living better. I believe not appreciating others for their good work is our own loss.

Remember, when we learn to appreciate others, we never lose anything, instead we become better persons. Appreciating others helps us to enhance our gratefulness and will also boost the doers’ capacity and fortitude.  The world requires good work of people. If we cannot do some good work, at least let’s appreciate other’s good work.

May be you don’t stop when you see an accident on road, but somebody else does stop; maybe you don’t contribute for somebody’s illness, but somebody else does; there are some good hearts who are helping people in emergencies, there are some generous people not very rich but, they still help some patient have better facilities in hospital. We don’t need to be rich to help, we need a strong heart, and we need compassion to lend other a support in their crucial times. If we can’t, let us at least appreciate those who go out of their way to reach out.

Learning to appreciate others’ ideas, sincerity, contribution, good deeds etc enhance one’s life. If we really take some time to ponder on how many people have helped us – done well to us so far in our lives; if we really count all those people and their contribution to our personal growth, and just bless them, it will harness the power of gratitude within us. Please try doing this, and it does feel really good.

Harness the power of gratitude within you. Many people for many good works, good deeds, good art, have never received any appreciation or reward in their lifetime. Do they need to be remembered after they pass away from this world? It is much better to say a word of appreciation while they are living than writing a beautiful biography or carrying a bouquet on their death ceremony. It is simply an act of hypocrisy in my opinion. The dead people – those imparted souls cannot see or smell beautiful flowers or read great biography written on them in their praise. While the person is alive, a simple appreciation is what is required.  Appreciating others and talking good of others after they are dead is one of the weakest attitudes of mankind in this world.

But friends, many people work hard regardless of others appreciation and recognition. But what about those young children who need to be held, who need to be supported, who need to be appreciated and recognised? Let’s not be cruel – let’s appreciate the youngsters to have a better and bright world tomorrow. Let’s harness their talent and their worth – so that we have more innovations and advancement for the future generations of our. Appreciation should come from our heart. If we do not appreciate others from our hearts, it is better not to show our artificial appreciation because it only wastes energy and time.

By appreciating we can boost and harness our relationships with others. A simple ‘Thank you’, Get well soon’’, ‘Happy Birthday’, Congratulation’, ‘Love You’, ‘Care for you’ can make great wonders in relationships. It’s so easy to forget and be aloof by not cheering others, by not loving others, not sympathizing with others, and not appreciating others.

In fact, to recognize others for their small good deeds is so beautiful. This simple tactic can literally transform an important relationship like a marriage, an employment, or friendship. If you constantly are ignorant about seeing the goodness in others, you will see your relationships will slowly deteriorate. Nobody wants to be associated with a self-centered, uncouth person.

It’s not too late to learn to say ‘’thank you’’ whenever someone shows you the least bit of consideration. Doing this will make you feel better and it will encourage others to be more considerate. There are plenty of rude and inconsiderate people out there in the world, but you can be a force for good people by simply spreading some appreciation and gratitude around. When you notice some good work of others, be quick to express appreciation and watch what happens – you will only see kindness, goodness, and uprightness around you.