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1. VRIO Analysis
VRIO is a tool to assess four aspects of a company's resources and capabilities in order to determine if they can lead to a sustainable competitive advantage.

• V (Valuable): Does it help exploit an opportunity or offset a threat?
• R (Rare): Is it unique or in short supply relative to demand?
• I (Inimitable): Is it hard or costly for competitors to copy?
• O (Organized): Is the firm structured to leverage it fully?

Outcome: If a resource is Valuable, Rare, Inimitable, and the firm is Organized to exploit it, that leads to a sustained competitive advantage.

Extra Method/Formula:
You can assign:
1 point for Valuable
1 point for Rare
1 point for Inimitable
1 point for Organized
A total of 4 points suggests high likelihood of sustained competitive advantage; fewer points indicate a more temporary or weaker advantage.

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2. The Value Stick
A visual framework showing how value is created and shared among customers, the firm, and suppliers.

Key Terms:

• Willingness to Pay (WTP): The max price a customer is willing to pay.
• Willingness to Sell (WTS): The minimum price at which a firm or supplier is willing to supply.
• Value Created: The difference between WTP and WTS.

Extra Formulation:
Total Value Created = WTP – WTS
Customer Surplus    = WTP – Price
Firm Margin         = Price – Cost
Supplier Surplus    = WTS – Cost(to supplier)

How to Use It:

• • Increase WTP by improving features, service, brand, etc.
  • Lower WTS (or Cost) by optimizing operations and supply chain.
  • Expand margin by careful pricing and cost control.

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3. Blue Ocean Strategy
Encourages creating new, uncontested market spaces (blue oceans) instead of battling in saturated ones (red oceans).

Four Actions Framework:
1. Eliminate – Remove factors that the industry takes for granted.
2. Raise – Elevate factors above the industry standard.
3. Reduce – Lower factors well below the industry standard.
4. Create – Add new elements the industry has never offered.

Extra Insight:

• Use a Strategy Canvas to map how you differ from competitors across key factors of competition.
• The aim is to simultaneously increase value and reduce cost, creating a leap in value for customers and the company.

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4. Hambrick and Fredrickson's Strategy Diamond
A holistic framework with five key facets of strategy:

Arenas	Where will we compete? (Product categories, geographies, etc.)
Vehicles	How do we get there? (Internal dev, JV, franchising)
Differentiators	How will we win? (Cost leadership, reliability, customization)
Staging/Pacing	Speed & sequence of moves (timing, expansions)
Economic Logic	How will we obtain returns? (Cost advantage, premium pricing)

How to Use It:
- Summarize each facet on a single page to ensure coherence.
- Revisit and update as markets evolve.

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5. McKinsey's Strategic Horizons
Balances near-term performance with long-term innovation:

• Horizon 1: Maintain and defend the core (main revenue source).
• Horizon 2: Nurture emerging businesses that can become significant.
• Horizon 3: Create new options—innovations that might pay off long term.

Application Tip:
- Distribute resources across all three horizons to avoid stagnation or neglecting future opportunities.
- Common resource allocation example: 70% for Horizon 1, 20% for Horizon 2, 10% for Horizon 3. (Exact ratios vary.)

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Putting It All Together

• Combine VRIO + Value Stick to identify unique resources and how you capture value.
• Blue Ocean for exploring uncontested spaces and escaping fierce competition.
• Strategy Diamond ensures coherence in arenas, vehicles, differentiators, pacing, and logic.
• McKinsey's Horizons balances short-term wins with long-term innovation.

By systematically applying these frameworks—often in tandem—you can develop a strategy that leverages internal strengths, maximizes market opportunities, and positions your company for sustained success.