Resource-Based View 1

 RBV and competitive advantage

 Focus on internal resources
 Value
 Rarity
 Imperfect imitability
 Lack of substitutes
Resource-Based Approach

Internal strategic factors:

Scanning and analyzing the external environment
for O and T is not enough to provide an
organization a competitive advantage. Analysts
must also look within the corporation it self to
identify internal strategic factors Critical
strengths and weaknesses that are likely to
determine if the firm will be able to take
advantage of opportunities while avoiding
threats.
Chapter 4
Wheelen/Hunger 2
Resource-Based Approach

Resource:

An asset, competency, process, skill,

or knowledge controlled by the
corporation.

Chapter 4
Wheelen/Hunger 3
 Evaluating Key Resources
VRIO Framework
 How to identify the key resources?
Base on four criteria:
1. Value: Does it provide competitive advantage?
2. Rareness: Do other competitors possess it?
3. Imitability: Is it costly for others to imitate?
4. Organization: Is the firm organized to exploit the
resource?
 If the answer is use to all it is considered distinctive
competence.

Prof. Dr. Majed El- Chapter 4

Farra Wheelen/Hunger 4
 Core and distinctive competencies
 Capabilities: organization ability to utilize its
resources. Its business process and routine.
 Competency: cross-functional integration and
coordination of capabilities. E.g., new product
development.
 Core-competency: collection of competencies that
crosses divisional boundaries. E.g., new product
development is a core-competency if it goes beyond
one division.
 Distinctive competencies: when core- competencies
are superior to those of the competitions.
Chapter 4
Wheelen/Hunger 5
Resource-Based View 2
 RBV and strategic balance
 All workers or just senior managers
 Human capital and human process
advantage
 Historical development of
organization
 Table stakes/enabling capabilities