Analysing A Resourced Based View Of Firms Business Essay


Leila A. Halawi, Jay E. Aronson and Richard V. McCarthy (2003) states that not only in a new millennium, but also in a new era: the knowledge era. Sustainable competitive advantage is dependent on building and exploiting core competencies with the purpose to earn long term profit as well as to satisfied customer need. The resource-based view (RBV) of the firm defines a strategic asset as one that is rare, valuable, imperfectly imitable and non-substitutable. Knowledge is seen as a strategic asset with the potential to be a source of competitive advantage for an organization. According to porter (1999) explain that we can make tough choices about what we have to do and not do to make competitive advantage. It means for successful corporate activities organisation need to know in the competitive environment how to use sustainable competitive advantage. He also defines that the capability towards earn profits on investment constantly higher than the standard intended for the industry (Porter, 1985).this line explain that for the successful organisation we must adapt sustainable competitive advantage and it shows the result in strategic assets which is the most advantageous thing of the RBV method. This was developed to explain how any organisation reach sustainable competitive advantages.( Barney, 1991; Wernerfelt, 1984, Hoopes, Madsen and Walker, 2003). Sustainable competitive advantages are the task of organisational governance, industry testing and organisational effects in the form of strategies and advantages. However, Collis (1994) recommended about advantages in marketplace that a firm can compete away by high-order capability by placing importance upon management as the strategic asset, that are simultaneously valuable, rare, difficult or costly to imitate, and non-substitutable, driving towards adaptability and ability of identifying opportunities (Connor, 2002).whereas, Godfrey & Hill (1995) and Michalisin, Smith & Kline (1997) noted that strategic assets are intangible in character and therefore they prove to be the most vital in sustaining the firm's capability and customers need than tangible assets which they can copied easily (Michalisin, Karau, And Tangpong, 2004).aplies the concept of RBV it shows that it focuses on the idea of costly-copy attributes of the organisations as the source of means to achieve better performance , competitive advantage and source of business returns (Barney, 1991; Rumelt, 1987; Conner, 1991, Prahalad and Hamel, 1990)

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According to assumption of the competitive organisation (I/O) model, the external background, of general industry and rival has a major impact on the firm's strategies. Comparing this environment. It can be found that industry background has a great impact, which by use of Porter's five forces model can be influence in the firm's favour by evaluating carefully the opportunity and threats within that industry environment. Certain industry has certain peculiarities on the basis of which strategies are been determined. Buller, beck-dudley & McEvoy(1990) suggested in their articles that different human practices approach uses different strategies like a high employee input ,mix of individual and group , in house equity rewards are tend towards use of differentiation strategy while narrow job assignments, fixed stable job description, external equity rewards are more likely towards cost leadership ,but increasing the competition in the market has created a cost control through economies of scale. In the today's competitive world it is not the first motive to look for the customer need ,but also has to look to their supplier which can offer chance to create a competitive positioning in particular industry or organisation .it has been described by Reck and long (1998) with the help of four progressive stages (passive, independent, supportive, and integrative) which explain that level involvement to firm's competitive advantage varies significantly ,

In Geoffrey r.(1995) article states that market allow finer grained product measurement of competitive condition than is possible useing conventional approaches. This approaches are as follows which are based on it's natural market approach is derived from the industrial organisation economics literature and the second, is on enactment approach, is connected with the open systems on viewpoint of organisation. As well as the weakness of the competitive positioning is that they attempt to sell their similar products is not sufficient to identify them as competitors, but sometimes some products having different kind of a demand in the different geographical areas, for e.g. Colget and Pepsodent , colget has a huge demand in rural market in India on the other hand pesodent has a huge demand in urban market. In the competitive environment, the market or industry ignore the customer side, their assumption is that market is national in extent and demand characteristics are same across the entire firm in the category. However in some cases market is not same or uniform. "the geographical extent of market has been a prominent issue in studies and discussion of antitrust issues surrounding mergers in the banking"(Jackson 1992) , health care (federal trade commission,1985),energy provision (duchesneau ,1975) among the areas in some other industries such as banking and health care uniformity in product offering is based on the geographical which is primary determinant of market boundries ,therefore in the geographical extension is the key to measures the organisation competitive environment which is consider as a strength of the competitive positioning . the main weakness of the competitive positioning in other industries the use of unspoken national boundaries for markets are confirm or fixed .on that Thomas and Venkatraman (1988), for example, argue for expanding the boundaries for the geographical scope in industry definition to allow for the fact that competition can be must go beyond the with the multinational or national boundaries. In this Thomas and Venkatraman wants to point out that if competition will be on the large scale then the new organisation can learn new thing from the competitors while this competitor can be harmful for the new or small scale industries.

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Howard Thomas and Alex Wilson stated in the their articles that Business schools are divisive organizations: the title of Khurana's recent book From Higher Aims to Hired Hands (2007) shows the insecure positioning of business

schools in the modern university. These business schools are always interested in management research and management education about the new strategies and so on, but it is too difficult to handle because of importance and cooperation

(Pettigrew, 1997).This schools are having better impact as well as point out the strength which will really helpful discipline-based scholarship shows that contribution for the knowledge of expanding management ,practice explain that trying to improve the practice of the management level of the people as well as the managers, academic and learning research involved mechanisms and awareness (AACSB, 2007) ,on the other hand there are some weakness which create a problem in management has a "cross-cutting ,multi- disciplinary nature (Pfeffer and

Fong, 2002)

According to one case study of Yugo - a cheap motor car cost of USD$3990.This car introduced in 1986 at price of less than USD44000 in USA. That time they made a good sell in the USA market but after sometime people knew that this car made up of a low quality material, poor performance which made a worst car of the year in all the car history. This case study shows that in competitive positioning we must look at the consumers need and wants within the company boundaries (Prof. Dr. Bernd Venohr 2007)

Above all applies the concept (i.g, resource based view and competitive positioning) defines the differences and similarities of themes which are as follows.

1) Prestige- now a days some product are costly or expensive but then also people buy and use these product because of the brand and prestige of that product which increase their status .in RBV method organisation must look for the comfort as well as the customers need and want, for them it's priority to serve the customer on the other hand in competitive positioning they sometimes ignore the customer wants to reach what they have. These both method are use for profit making this the similarities. For example, Rolex watches they make expensive watches which are made up of some gold, diamond studded and new technologies, while the same time they provide after sell services.(

2) Performance and engineering design -(Mercedes,bmw) in this part, Mercedes-Benz and BMW make a luxurious car.These two car companies are competitor

3) Reliability -(jhonson &jhonson )

4) Spare parts availability - (caterpillar)

5) Better service - (fedex, ritz-carlton)

6) One-roof shopping and wide selection - (

7) Image -(starbuks)

8) Technological - (sony, Verizon)

9) Quality - (toyota)