Analysis of Pixar Animation Studios' Tangible and Intangible Assets

This report assesses Pixar Animation Studios' tangible resources, intangible resources, and organizational capabilities, determining if they are valuable, rare, difficult to imitate, and difficult to substitute. It explores Pixar's financial, physical, and technological resources, including Steve Jobs' initial investment and software/hardware, highlighting their importance in financial statements. The analysis then delves into intangible assets, such as organizational structure, human resources (e.g., John Lasseter and Ed Catmull), and reputation, along with the synergy gained from the Disney partnership. The report applies the VRIN framework to demonstrate Pixar's valuable and rare resources, as well as in-imitable resources due to social complexity and path dependence, concluding that these factors contribute to its sustainable competitive advantage in the animation industry. The report is supported by references and APA format.

Running head: PIXAR ANIMATION STUDIOS 1
PIXAR Animation Studios
Institution
Student
Date

PIXAR ANIMATION STUDIOS 2
PIXAR Animation Studios
Write a 2 page paper that assesses Pixar’s Tangible Resources, Intangible Resources and
Organizational Capabilities and determine if they are Valuable, Rare, Difficult to imitate and
Difficult to substitute. Support your assessment.
Tangible Resources: Tangible resources refer to physical assets such as cash, machinery,
inventory, buildings or land that Pixar can liquidate and have a set value (Kamasak, 2017).
Pixar’s tangible resources can be categorized into financial, physical or technological. Steve
Job’s initial investment as well as Pixar’s capacity to deliver provided the company with ample
financial resources for future growth and development. Besides, Steve Job’s financial
investments enabled Pixar to get software and hardware required to advance internal resources
further. These tangible resources are very crucial in Pixar’s accounting since they help it
understand its financial standing when entered on financial statements and balance sheets.
Intangible Resources: Intangible Resources, on the other hand, refer to Pixar’s assets which
lack a physical substance (Won, & Chelladurai, 2016). These assets are of greater longer term
value to Pixar than tangible resources since intangible assets are not quickly used up. Pixar’s
intangible assets can as well as categorized into organizational, human, reputation, and synergy.
In Pixar there is a committee-run organizational structure that supported creativity required to
produce high quality animated movies. Human resource was another vital asset of Pixar. In the
case, John Lasseter has been referred to as “the Walt of the 1st century. In addition, Ed Catmull
led the technology advancement which enabled Pixar to be more innovative than the rest of the

PIXAR ANIMATION STUDIOS 3
animation studios. Due to the wide array of resources Pixar was endowed with, this
organization had an outstanding reputation in the market. Its new business relationship with
Disney further provided it with synergy wherein they could work jointly in a certain productive
manner which produced an impact greater than the sum of their individual impacts.
Organizational Capabilities: Organizational capabilities refer to Pixar’s capacity to manage
both tangible and intangible resources to efficiently acquire an advantage over their competitors
in the filming industry (Lee, & Klassen, 2016). Their capability to tie together various
technological innovations to support creative storytelling implied that Pixar had vital
organizational capabilities to acquire a sustainable competitive edge. Determining whether the
Pixar’s internal assets or resources are valuable, rare, difficult to imitate or difficult to substitute
can assist Pixar in sustaining its competitive advantage in the market. In Chapter 3, Exhibit 3.6,
applying the VRIN (Valuable, Rare, Imperfectly Imitable, Non-Substitutable) analysis
framework to the above demonstrates that Pixar had both valuable and rare resources that almost
all capable firms should have so that they can compete. However, Pixar also had in-imitable
resources owing to the socially complex, casually ambiguous, and path dependent of these
particular resources’ development. Besides, there was no any other way to substitute assets from
other assets to compete in producing animated films of the highest quality.

PIXAR ANIMATION STUDIOS 4
References
Kamasak, R. (2017). The contribution of tangible and intangible resources, and capabilities to a
firm’s profitability and market performance. European Journal of Management and
Business Economics, 26(2), 252-275.
Lee, S. Y., & Klassen, R. D. (2016). Firms’ response to climate change: The interplay of
business uncertainty and organizational capabilities. Business Strategy and the
Environment, 25(8), 577-592.
Won, D., & Chelladurai, P. (2016). Competitive advantage in intercollegiate athletics: Role of
intangible resources. PloS one, 11(1), e0145782.