Question

True Moto Corp. (TMC) is a leading automobile company. The company has been able to sustain its competitive advantage primarily due to its high-quality and efficient electric motors. Most of its competitors have failed to develop similar electric motors at a reasonable price. Which of the following resource attributes listed in the VRIO framework has helped TMC sustain its competitive advantage?A. Resource mobility
B. Inexhaustible nature
C. Intangibility of the company's resource
D. High costs involved in imitation

Answer 1

Answer:

The correct answer is the option D: High costs involved in imitation.

Explanation:

To begin with, the name of ''VRIO'' refers to an analysis that is used in the field of business in order to obtain better results in the strategy of the firm's management process, focusing in a resource or capability that the company possesses in order to determine its competitive potential.

To continue, the questions about imitability in the analysis are the ones that focuses in the costs that the other companies will have to generate a resource or capability and if they have or not a disadvantage due to that. To sum up, in the case presented, the TMC's competitors face a disadvantage regarding the costs of imitation due to the social complexity, patents, unique historial conditions and casual ambiguity. Therefore that TMC is able to mantain its competitive advantage.