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VRIO is a framework that refers to four questions which include: Question of values, rarity, imitability and organization. A framework is an analytical tool for examining the internal environment of organizations (Barney & Hesterly, 2006). Firms should answer all the four questions in the VRIO framework to determine their competitiveness in the market. Gulf Air Company resources can be analyzed using the framework to determine its competitive advantage in the market. The resources that determine the competitiveness of a firm include tangible, intangible and organizational capabilities.

Question of Value

The value of an organizational resource can enable it to gain a competitive advantage in the market. An organization can also reduce its environmental threat when its resources are valuable (Lin, 2012). Gulf Air Company has tangible and intangible resources that are valuable to the organization. Other rival companies within the airline industry are also having similar resources such as financial and human resources.

The Question of Rarity

The resources that Gulf Airline Company has been owned and controlled by a few of the rival firms. Many companies in the airline industry use different resources. This makes the resources of the company to be rare among other competing firms in the industry. Modern aircraft, airport facilities, skilled management and innovativeness are not only controlled by the Gulf Airline, but also other few organizations in the industry.

The Question of Imitability

Firms with no resources can experience a cost disadvantage in the market (Barney & Hesterly, 2006). It can become difficult for such firms to develop effective resources that can ensure competitiveness. Gulf Air Company has adequate resources which make it have a cost advantage in the airline industry. Other airline companies also have adequate resources that can enable them to imitate what Gulf Airlines is doing. The resources of the company can be easily imitated by other airline companies since they have appropriate resources and adequate skills. This implies that the resources of the organization are easy to copy and therefore can reduce its competitiveness in the environment.

The Organization

Gulf Air organization ensures that it exploits its rare and valuable resources that prove difficult to imitate. Its policies and procedures ensure that there is secrecy in the management affairs of the organization. The organization has policies that prohibit sharing of information and resources. The organization is therefore perceived to be managed properly.

Summary of the VRIO analysis of Gulf Air Company

The resources of the company are rare since few firms possess them. The company has resources that are valuable for the exploitation of market opportunities. Imitating the organization’s resources proves difficult to a number of firms. Other firms have the capability and resources that can enable them to imitate the organization’s resources. The company ensures the proper organization of its resources. The implication of the VRIO analysis of the company implies that it has temporary competitive advantage. The economic implication of the whole scenario is that the company is above normal.


Barney, J., & Hesterly, W. (2006). Organizational Economics: Understanding the Relationship between Organizations and Economic Analysis. The SAGE handbook of organization studies, 111.

Lin, C., Tsai, H. L., Wu, Y. J., & Kiang, M. (2012). A fuzzy quantitative VRIO-based framework for evaluating organizational activities. Management Decision, 50(8), 1396-1411.

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