VRIN Framework

Applying Barney's (1991) VRIN framework can determine if a resource is a source of sustainable competitive advantage. To serve as a basis for sustainable competitive advantage, resources must be --

• valuable -- meaning that they must be a source of greater value, in terms of relative costs and benefits, than similar resources in competing firms
• rare -- rareness implies that the resource must be rare in the sense that it is scarce relative to demand for its use or what it produces
• inimitable -- it is difficult to imitate
• nonsubstitutable -- other different types of resources cannot be functional substitutes

The criteria of the VRIN Framework clearly rules out best practices as a source of competitive advantage. If other firms can easily understand and copy a capability, it is not a source of advantage.