Two core competencies are identified in this VRIO analysis of McDonald’s Corporation. VRIO Core Competencies (Long-Term Competitive Advantages) of McDonald’s. Such strategic capabilities and resources, together with McDonald’s food product uniqueness, HR development, production systems, supply chain and associated supply chain management, franchise network, and economies of scale are non-core competencies that do not satisfy all of the VRIN and VRIO criteria, especially inimitability (VRIO analysis model), and non-substitutability (VRIN analysis framework). This strategic resource improves value chain effectiveness and customers’ ease in purchasing. For example, McDonald’s mobile app integrates the Apple Pay mobile payment processing service provided by Apple Inc. New order processing technologies are organizational resources that are also part of the company’s digital initiative considered in this internal analysis. Delivery service providers like Uber Eats (a subsidiary of Uber Technologies Inc.) bring fast food to customers’ doorsteps. For example, McDonald’s partnerships with third-party delivery service providers are an organizational capability under the company’s strategic digital initiative. In the resource-based view, these competencies support the restaurant company’s value chain’s operational effectiveness but not long-term competitive advantage. McDonald’s Corporation has numerous resources and capabilities that are non-core competencies indicated in the VRIO/VRIN analysis table. This VRIN/VRIO analysis table is best viewed using HTML5-compatible browsers. Globally recognized iconic McDonald’s brand McDonald’s Sustained Competitive Advantages/Core Competencies: Size of international operations and restaurant franchise network New technologies for efficient order processingĮffective and efficient human resource developmentĮfficient food production systems for cost efficiency and low prices
Partnership arrangements with third-party delivery service providers Moderate uniqueness of food products based on McDonald’s-specific recipes McDonald’s Corporation VRIO & VRIN Analysis, Table (Resource-Based View) McDONALD’S ORGANIZATIONAL RESOURCES & CAPABILITIES However, as this VRIN/VRIO analysis indicates, McDonald’s needs to develop additional core competencies and sustainable competitive advantages to improve the positioning and long-term survival of its restaurant chain business. In the resource-based view and the following value chain analysis results, the company utilizes its resources and capabilities to compete against strong multinational food service firms and address market-specific issues. The following section discusses the VRIO and VRIN assessment of the organizational capabilities and resources that influence McDonald’s value chain and strategic planning processes. In the VRIO/VRIN analysis context, McDonald’s applies its core competencies to reinforce its value chain’s effectiveness to deliver actual value to consumers and ensure long-term competitive advantages in the international fast food market, despite strong strategic hurdles in the U.S. The food service industry’s challenges require core competencies for strategic positioning. Using its core competencies, McDonald’s Corporation’s value chain imposes sustainable competitive advantages against firms like KFC, Subway, Burger King, Wendy’s, Dunkin Donuts, and Starbucks. This internal analysis determines core competencies within the resource-based view (RBV) of the fast food company. These measures build on the VRIN analysis framework, which includes the non-substitutable (N) criterion. Barney’s model, McDonald’s core competencies are the resources and capabilities that satisfy the VRIO measures: Value, Rarity, Inimitability (Imperfect Imitability), and Organization.
In this VRIN/VRIO analysis of the company, such organizational capabilities and resources are the strategic foundation for competitiveness. McDonald’s Corporation uses its VRIO and VRIN resources and capabilities to keep its fast food restaurant business profitable. A VRIO/VRIN analysis and value chain analysis of McDonald’s Corporation, in the resource-based view, underscore the strategic significance of organizational resources and capabilities pertaining to process efficiency, operations management, and human resource management strategies to sustain the company’s value chain, and core competencies and competitive advantages in the global food service market. The signage of a McDonald’s fast-food restaurant in Madrid, Spain.
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