Read this article, which describes how to utilize an organization's valuable resources to create a long-term sustainable strategy.
In the resource-based view (RBV), strategic planning uses organizational resources to generate a viable strategy.
Describe the intrinsic competitive advantage defined by the resource-based view strategy
The resource-based view (RBV) of strategy holds company assets as the primary input for overall strategic planning, emphasizing the way in which competitive advantage can be derived via rare resource combinations. To transform a short-run competitive advantage into a sustained competitive advantage requires that these resources are heterogeneous in nature and not perfectly mobile. Effectively, this principle translates into valuable resources that are cannot be either imitated or substituted without great effort. If the firm’s strategy emphasizes and accomplishes this goal, its resources can help it sustain above-average returns.
In many ways, business strategy aims to achieve competitive advantage through the proper use of organizational resources. As a result, the resource-based view offers some insight as to what defines strategic resources and furthermore what enables them to generate above-average returns (profit). Upper management must carefully consider what resources are at the company’s disposal and how these assets may equate to operational value through strategic processes.
In achieving a competitive advantage, the resource-based view defines characteristics which make a competitive process sustainable. These characteristics are described as valuable, rare, inimitable, and non-substitutable, referred to as VRIN:
A company should care for and protect resources that possess these characteristics, because doing so can improve organizational performance. The VRIN characteristics mentioned are individually necessary, but each is insufficient on its own to sustain competitive advantage. Within the framework of the RBV, the chain is as strong as its weakest link, and therefore requires the resource to display each of the four characteristics to be a viable strategy for competitive advantage.
Source: Boundless Management, https://courses.lumenlearning.com/boundless-management/chapter/internal-analysis-inputs-to-strategy/
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