In this part of the report the different capabilities of Darden will be explained and which of these capabilities lead to competitive rivalry. But first the different resources and competences will be discussed which will lead to the capabilities. 1) Resource;
A physical resource of Darden is;
There different restaurants, with this is meant the different buildings that Darden owns with the different kind of restaurants. 1) Competence;
The competence that Darden has is;
To make different kind of dishes.
When the above mentioned resource ad competence are linked then the following capability emerges; Flexible to make different dishes for different markets.Darden has 8 different brands. Each brand standing for its own kind of food like; Italian of seafood. This means that Darden offers all kinds of food to the consumers. After applying the VRIN model to this capability the conclusion is; V-> This capability is a value for the consumers due to the fact that Darden gives them the opportunity to choice between different restaurants. This capability allows Darden to be profitable in the market. R-> Different brands plus products are included in one chain. Unfortunately for Darden is capability is not Rare, different competitors have the same kind of capability. ( for example Laundry’s, DineEquity) I-> This capability is possible to imitate, but this will take some time and the right amount of financial resources. N-> This capability is possible to substitute by another company. For example Yum Restaurants, they have also different dishes for different markets with their Taco bell, KFC and Pizza Hut. Conclusion Capability 1);
The above mentioned capability is not one that is unique and that is not difficult to imitate, but however it is still a strength for Darden due to the fact it gives Darden a great brand image, and it gives it an advantage compared to their smaller competitors who do not have this capability as strong as Darden.
A Human resource that Darden has is:
Well trained and guided staff.
A competence that Darden has is;
Skill to buy the best products (for example Darden sources top quality seafood from more than 100 varieties. 2) Capability;
When the above mentioned Resources and competence are combined then the following capability emerges; Capable of making high-quality food.
High quality is always something under discussion, what is high quality? In this case is meant food that has a very good quality versus cost proportion. And speaks to a lot of people. After applying the VRIN model to this capability the conclusion is; V-> This capability has a great value for the consumers because a good quality versus cost proportion is something that quest will remember and will tell to their friends and families. R-> This capability is not rare, there are a lot of restaurants that can make high quality food against a good price for the consumers. I-> Is this capability Imitational, yes when looking at the above mentioned point ( R) there it shows other restaurants are already doing this. N-> This capability can be substitute, what has been explained earlier is that restaurants are already having the same kind of capability. Conclusion Capability 2)
The capability of making high-quality food is very important for Darden because consumers expect a level of quality when they go to one of Dardens restaurants. For this case it is a strength of Darden. However it is not a very strong capability due to the fact that multiple competitors are doing the same and that it is very easy to imitate or substitute.
A resource that Darden has is;
There strong marketing.
A competence that Darden has is;
Using all kinds of advertising.
When the above mentioned resource and competence are combined then the following capability emerges; Darden’s ability to market its restaurants. Darden is a leading advertiser in the full size dining segment of the hospitality industry. Darden uses different kind of methods to advertise their brands, like local and cable television, digital advertising, billboards, search engine marketing, radio and newspapers. After applying the VRIN model to this capability the following conclusion can be made; V-; This capability will generate more consumers which will bring more revenue, if the cost are low enough to be profitable in this part then this can be a huge Value to the company.
For the consumers this will also be a Value because they stay up to date with new actions, menu changes and promotions. R-; This capability is not rare at all, almost every company has a marketing department and advertises itself. I-; Marketing is very imitational due to the fact that everybody sees them so other companies can easily use the same kind of method, However due to the fact that Darden has multiple brands is can target and advertise to all these markets at the same time which gives them an advantage. N-; This capability can be substituted by a different company, because there are already companies with multiple brands that target and advertise to different markets. (Laundry’s) Conclusion Capability 3)
Of the 3 capabilities mentioned in this part of the report, capability 3 is the weakest. It is still an important part of the company, but it is very difficult to stand out on marketing now a day compared to competitors. It is more a capability that is at least required to be successful.
When looking at the 3 different capabilities explained in this part the capabilities concerning the different dishes and the high quality of food are two strong and important capabilities that Darden has. The marketing capability is not as strong but it is still a plus point of the company. Without the marketing Darden would not be as successful as it is today.