Standard VRIO Diagram
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Standard VRIO Diagram

Competitive implication

Valuable?

Rare?

Costly/Hard

to imitate?

Exploited

by the

organiation

Competitive disadvantage

Competitive Parity

Temprary competitive advantage

Unexploited competitive advantage

Sustained competitive advantage

NO

YES

NO

NO

NO

YES

YES

YES

YES

YES

YES

YES

YES

YES

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publish time: 2021-08-13
Viro

In the following VRIO model, the "Competitive Disadvantage – not valuable" means that we can not create value using this resource/capability, so it should be reconsidered because it brings no value to any company. At the very same time, "Unexploited Competitive Advantage – valuable, rare, imitable but not organized" means that resource or capability generates a rare value in the market, and it is hard to imitate. Despite these advantages generating this value is expensive in terms of money, effort, plan, organize, lead and control. As the below graphical representation suggests, the VRIO model focuses on the internal factors, not external factors like supplier's situation, economic, political, technological, social, marketplace demand change, etc.

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