Marriott International VRIO Analysis and Value Chain

Topics: Marriott International, Supply chain management, Management Pages: 6 (1151 words) Published: July 25, 2004
Distinctive Competencies

The VRIO analysis is helpful in determining if a resource or capability leads to

competitive advantage (Middleton, 2004).

Resources/Capabilities Valuable? Rare? Costly to Imitate? Exploited by Organization Competitive Implications Strength or Weakness

Key Account Management Initiative Yes Yes Yes Yes Sustained Competitive Advantage Strength and Sustainable Distinctive Competence

Recruitment Process Yes Yes No No Temporary Competitive Advantage Strength and Distinctive Competence

Brand Loyalty Yes Yes Yes Yes Sustained Competitive Advantage Strength and Sustainable Distinctive Competence

Community Involvement Yes No No No Competitive Parity Strength

Employee Loyalty Yes Yes Yes Yes Sustained Competitive Advantage Strength and Sustainable Distinctive Competence

Marriott has a few distinctive competencies that are the driving force in their company. Superior efficiency is evident in their personnel. Marriott has been named by Fortune Magazine as on of the "100 Best Companies to Work For" and one of the "Top 50 Companies for Minorities" (Marriott is, 2004). They are also very concerned with minimizing employee turnover because of the high costs associated with training new employees. Their recruitment process screens out people motivated by money, and focuses on people who are motivated by recognition (Have, 1991).

Superior responsiveness can be seen in their key account management incentive the company has in place. Marriott noticed that travel and entertainment expense is the third largest expense in corporations. This management incentive allows Marriott to focus on their potential customers and gain customer loyalty (Millman, 1996).

One of the intangible resources that Marriott has is its reputation. Not just their reputation with customers, but also their reputation with the community. The Marriott brand is a valuable resource. It is estimated that by adding the Marriott name to Fairfield Inn increased occupancy rates by 15%. Marriott fully exploits this resource by the global expansion that Marriott has undertaken (Tepeci, 1999). As for the reputation within the community, Marriott has received the Global Services Leadership Award, because of their commitment to the community, and their excellence in strategic business use of services (Marriott Receives, 2003).

Fairfield Inn, one of Marriott's subsidiaries, initiated a program to benefit Habitat for Humanity. This will include donations, sponsorships, and volunteer services. Marriott has also initiated the Spirit to Serve Our Communities Day which gives associates a chance to give back to their communities (Marriott's Fairfield, 2004).

Competitive Advantage

The VRIO analysis concluded that Marriott International has a competitive advantage in its primary industry. They have three resources that provide them with a sustained competitive advantage, and one resource with a temporary competitive advantage. It is the responsibility of every employee to generate a competitive advantage by creating and exploiting resources (Barney, 2002).

Prior Strategies

Prior strategies have played a large role in shaping Marriott's distinctive competencies. The use of technology to improve customer service has been a vital part of Marriott's strategies.

The use of computer based property management has improved efficiency in the hotels and allowed employees to focus on the customers demands (Serlen, 2004). Marriott has been very focused on retaining customers and building on their brand loyalty. By the use of technology they have been able to provide faster service and safer environments (Serlen, 2004).

Current Strategies

Marriott's current strategies include the continued process innovation and the globalization of their company. They are using technology to continually improve the process or property management. Marriott is currently in the process of testing the use of lobby kiosks to assist in guest...

References: Barney, J. (2002). Gaining and Sustaining Competitive Advantage. New Jersey:
Prentice Hall
Friday, D. and Smolova, K. (2004, Feb. 1). Focus: The rise of facility management.
Prague Tribune. Retrieved July 15, 2004 from http://galenet.galegroup.com
Have a nice day
Habitat for Humanity '. (2004, May 19). PR Newswire. Retrieved July 15, 2004 from http://galenet.galegroup.com
Marriott is Most Admired Company in the Lodging Industry according to Fortune.
(2004, Feb. 26). PR Newswire. Retrieved July 15, 2004 from http://galenet.galegroup.com
Marriott receives Global Services Leadership Award
Retrieved July 15, 2004 from http://galenet.galegroup.com
Marriott testing lobby kiosks
Journal of Marketing Practice. Retrieved July 15, 2004 from
http://0-oberon.emeraldinsight.com.
Purchasing. (2004) Retrieved July 15, 2004 from
http://marriott.com/development/lodgingPurchasing.mi
Serlen, B. (2004, May 10). New Brands, Tech Transform Lodging. Business Travel
News
Tepeci, M. (1999). Increasing brand loyalty in the hospitality industry. International
Journal of Contemporary Hospitality Management
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