Basic Principles of The Resource Based-View of The Firm

BASIC PRINCIPLES
The resource-based view of the firm (RBV) examines the link between the internal characteristics of a firm and firm performance (Barney, 1991). Broadly speaking, this means that the resource-based view is concerned with the relationships between a firm’s resources and competitive advantage. It suggests that an organization can be regarded as a bundle of resources where resources such as a firm’s management skills, its organizational processes and routines and the information and knowledge it controls can be used by firms to help choose and implement strategies and ultimately achieve superior performance. These resources which are simultaneously valuable, rare, imperfectly imitable and imperfectly substitutable (Barney, 1991) are a firm’s main source of sustainable competitive advantage and called in short a VRIN resource. In a later work (2002), Barney proposed an alternative to the VRIN framework the VIRO or VRIO framework.

OVERVIEW OF THE RESOURCE-BASED VIEW OF THE FIRM
Origins of the resource-based view of the firm
Up to the early 1980s strategic management was very much dominated by neoclassical economics and notably the structure-conduct-performance paradigm of Industrial Organization economics (10) (Caves and Porter, 1977; Caves, 1980; Porter, 1980). According to the IO perspective the source of organizational profits is market positions protected by barriers to entry into the market. The RBV rests on the assumptions that competitive advantage does not derive from market and industry structures but rather that it derives from a firm’s internal resources.

Sumber:
Jenkins, M., Ambrosini, V., & Collier, N. (2016). Advanced Strategic Management. New York: Palgrave.