The paper “ Firm Resources and Sustained Competitive Advantage” is a spectacular example of the literature review on business. The article contribution is noticeable because it shows the relationship between sustained competitive advantage and firm resources. According to the study, sustained competitive advantage cannot be achieved if the firm’ s resources are perfectly mobile and homogenous. However, this is possible of the firm has a first-mover advantage, whereby a temporary competitive advantage can be realized. The article offers addresses a number of key assumptions and concepts with the objective of contrasting and comparing resource-based view with traditional strategy theory.
In this case, the traditional theory assumption; homogeneity amongst firms as well as high resources mobility are relaxed by the resource-based view. According to Barney (1991, p. 99), companies get sustained competitive advantage through strategies implementation, especially those that exploit the firm’ s internal strengths by capitalizing on external opportunities. The article helps one understand the firm’ s environmental impact on its competitive position, especially with regard to how the competitive position of the firm is impacted by idiosyncratic attributes of the firm. The two simplifying assumptions that have been adopted in the study have successfully provided an understanding of how the firm’ s environment impact performance.
The article provides a number of definitions (sustained competitive advantage, form resources, and competitive advantage) so as to eliminate any possible confusion in view of this, firm resources have been defined by Barney (1991, p. 101) as the strengths that can be utilized by the firm to formulate and implement strategies. Firm resources have been categorized into three; human capital resources (intelligence, experience, training, employees), physical capital resources (geographic location of the firm, equipment and plant, physical technology, raw materials accessibility, and organization capital resources (structure of formal reporting, systems for planning, coordinating and controlling, informal relations).
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