How does Resource-Based View (RBV) concept can be used by a business to carve out

competitive advantage?
For a business organization to be competence and successful, it needs competitive advantage, the
ability of one frm to outperform others. Thus, if a company able to satisfy the value aspect which
is expected by the customer that is better than the other competitors, such company would possess
a competitive advantage. However, there is a temporal dimension to competitive advantage. A
competitive advantage may be temporary, for instance, possession of a physical resource another
frm may later acquire or develop, while a sustainable competitive advantage can last indefnitely
which each business organization should have in these days to survive as they all facing highly
competitive environment each day.
Hence, the resource-based view (RBV) deals with the competitive environment facing the
organization but its starting point is the organizations internal environment in which inside-out
approach applied. RBV emphasizes the internal capabilities of the organization in formulating
strategy to achieve a sustainable competitive advantage in its markets and industries. RBV able to
curve the competitive advantage as it allow the organization to confgured or reconfgured its
internal capabilities (which is its resources and its capabilities) in order to determine the strategic
choices it makes in competing in its external environment that will pay attention to the
confguration of its value chain activities which provide it with competitive advantage.
In the concept RBV, it enables an organization to discover its sustained competitive advantages
which is occurring: (1) when it is implementing a value-creating strategy that is not being
implemented by current or potential competitors and (2) when competitors are unable to duplicate
the benefts of this strategy. This need to meet all four of these guidelines:
RBV Guideline 1: is the resource or skill critical to fulflling a customers need better than that
of the frms competitors?
Now, an organization needs to identify and classify the organizations resources. It need to
appraise strengths and weaknesses relative to those of its competitors in order to identify the
opportunities for better resource utilization as this help the organization to identify the
organizations capabilities i.e. what it can do better than its rivals, to come out strategies that can
best exploits the organizations resources and capabilities relative to the opportunities that exist in
the external environment which these cluster of attributes can lead the organization to achieve
competitive advantage. Hence, the organization need to have the skills and capabilities to identify
and recognized the valuable resources that able contribute to competitive superiority.
RBV Guideline 2: Is the resource scare? Is it in short supply or not easily substituted for or
imitated.
At this juncture, the organization needs to identify whether they have the resources (it can be
anything: money, materials, human resources, technologies, etc.) that are valuable where they
enable the frm to formulate and implement strategies that improve its efciency and efectiveness
in which it can exploits opportunities and/or neutralize threats provide a means of competitive
advantage.
Thus, valuable organizational resources: (1) only be able to be supply/contribute by itself where no
other organization would able to have/posses such resources (2) must be rare where many
organizations are unable to formulate and implement the same strategies, (3) cannot be able to be
imitated by the competitors to avoid being compete away an organizations ability to generate
above-average returns (4) must not be categorized as strategically equivalent valuable resources
that are themselves not rare or can be imitated as it may not be possible for a frm to imitate
another frms resources exactly, it may be able to substitute a similar resource that allows it to
formulate and implement identical strategies and very diferent frm resources also can be strategic
substitutes.
If the organization is to achieve sustainable competitive advantage, it is necessary that competing
organization cannot copy these resources. At this point, in order an organizations resources to be
difcult to imitate it need to embody: (1) a unique location as its possession is a resources that is
difcult to imitate where it may be experienced a competitive advantage through the uniqueness of
its climate, soil and expertise handed down through generations which allows it to generate
superior returns; (2) a unique experiences that an organization had acquires to date as a result of
its tenure in business in which the competitors cant able to acquire these resources on the open
market and cant able to copy the frms value- creating strategy; (3) a unique characteristics that
the link between the resources controlled by an organization and its sustainable competitive
advantage is not understood or is only partially understood in which competitors unable to
replicate their resource combinations or their unique history as unsure of the exact source of its
competitive advantage; (4) the unique factor that they may be based on complex social interactions
where these exist between managers in organization, a frms culture, and a frms reputation with
its suppliers and customers which causes the causal ambiguity between the resources and
competitive advantage of the organization.
RBV Guideline 3: Appropriability: Who actually gets the proft created by resource?
Here, after the organization had been recognize its resources and capabilities that needed to
exploit its opportunities and neutralize threats, it sometimes may found out that whether such
resources should be utilized at a point of time, if there is a scare of resources when implementing
strategy, which resources should be allocated frst? What should it be done? This means that some
resources is need to be appropriated to be utilized at certain part of time, if it is scared, it enable to
be solved by merging, partner, outsource or even buy over other competitors in order to shares the
resources and capabilities to produce even better, more value-added products/services to earn
more profts and enhance brand recognition which give a win-win situations to each other.
RBV Guideline 4: Durability: How rapidly will the resource depreciate?
As we all know that any resources that can be replaced may be able to be depreciated. Thus, the
organization needs to formulate strategies that enable it to sustain the resources from being easily
depreciated but rather having it being appreciated as the slower a resources depreciates, the more
valuable it is, if the resources, for instances, the brand name being appreciated, more customer will
go for it then proft will be increased. Thus, the organization needs to be often making the notion
of durability critical test of the value of the key resources and capabilities to ensure that the most
important contributors are not being depreciated in order to be in long term survival.