firm resources & sustained competitive advantage

Firm Resources
Sustained Competitive Advantage
Presenters: Yufei Wang
Ka Kei Ng
Thank you
for your attention!
Questions?

References
Key
Concepts
Physical capital resources
Human capital resources
Organizational capital resources
Two assumptions of Resource-Based Model
1. firms within an industry (or) group may be heterogeneous with respect to the strategic resources they control

2. these resources may not be perfectly mobile across firms, and thus heterogeneity can be long lasting.

Improve
efficiency and effectiveness
Rareness
Rareness
&
Strengths
Weaknesses
Opportunities
Threats
Internal Analysis
External Analysis
Resource-Based
Model
Environmental models of competitive advantage
(Porter's 5 forces)
Firm Resources Heterogeneity

Firm Resources Immobility
The framework of firm resources and competitive advantage
Sustained Competitive Advantage
Vale
Rareness
Imperfect Imitability
History Dependence
Causal Ambiguity
Social Complexity
Substitutability
——Firm Resources Heterogeneity
——Firm Resources Immobility
Firm Resources
Competitive
Advantage
Implementing a value creating strategy not simultaneously being implemented by any current or potential competitors.
Sustained
Competitive
Advantage
Competitive advantage that cannot be duplicated by current or potential competitors
Assumptions
Decision Factors
Judgement
Four Attributes
Valuable Resources
Rare
Resources
Imperfect
Imitability
Substitutability
Valuable Resources
Imperfect
Imitability
History Dependent
Causal
Ambiguity
Social
Complexity
Substitutability
The Framework
Analyze
the potential
resources
to be sources of SCA.
Cannot purchase
it, but
found
resources already controlled
Not
simultaneously

implemented
by other firms
No. of firm with resource is
less
than No. of needed
Cannot be obtained
by competitors
for one or a combination of three reasons:
Exploit
opportunities or
neutralize
threats
Resources depending on unique
time and space
Locations, Scientists, Organizational culture...
Competitors
cannot understand
the link between the resources and sustained competitive advantage; don't know
which
resources they
should imitate
Resources have social phenomena,
beyond
the ability to manage and influence
Interpersonal relations, Firm's culture, Firm's reputation
No equivalent
value resources
- different management team
Two forms of substitutability
Substitute a
similar
resource.

Substitute
different
resources, but strategically equivalent

- charismatic leader and planning process
Barney, J., (1991) "Firm Resources and Sustained Competitive Advantage", Journal of Management, Vol. 17, No. 1, pp 99-120
Javalgi, Radulovich, Pendleton, Scherer, (2005) "Sustainable competitive advantage of internet firms: A strategic framework and implications for global marketers", Journal of International Marketing Review, Vol.22 (6)
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Do you think formal strategic planning is SCA?
- Valuable (recognize opportunities and threats)
- But not rare (a lot of firms using)
- Highly imitable (any firms can learn)
- Substitutable
How about positive reputation and relationship?
- Depends: may be rare (history dependent)
may be imitable (social complexity)
may be substitutable(guarantee)