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CS Professional · Strategic Management and Corporate Finance · Analyzing the External and Internal Environment

A Pune-based auto-component maker has a patented casting process, but its plants lack the systems and trained staff to use it at scale, so rivals still match its output. Under the VRIO framework, which element is missing?

The missing VRIO element is Organisation. The patented process is valuable, rare and hard to imitate, but the firm lacks systems and trained people to exploit it at scale, so the resource does not translate into a sustained advantage over rivals.

  1. AValue
  2. BRarity
  3. CImitability
  4. DOrganisationCorrect

Explanation

The patent is valuable, rare and hard to imitate, but the firm is not organised (processes, systems, people) to capture its benefit. Hence the missing element is Organisation, and the resource yields only temporary or no advantage.

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