10- Resource-Based Theory (RBV) Internal Strategic Analysis/Intellectual property Chapter 4 Lesson 1
In Internal strategic analysis, resource-based theory is an important tool. A strategic resource is an asset that is valuable, rare, difficult to imitate, and nonsubstitutable, such as Intellectual property. Intangible resources are resources that are difficult to quantify, such as the knowledge and skills of employees, a firm's reputation, and a firm's culture. If a piece of intellectual property is valuable, rare, and nonsubstitutable, it can also constitute a strategic resource. Learning Objectives:
• Define the four characteristics of resources that lead to sustained competitive advantage as articulated by the resource-based theory of the firm.
• Understand the difference between resources and capabilities.
• Be able to explain the difference between tangible and intangible resources.
• Define the four major types of intellectual property.
Resource-Based Theory: The Basics
VALUABLE resources aid in improving the organization's effectiveness and efficiency while neutralizing the opportunities and threats of competitors. If yes, the company's resources and capabilities are valuable and can be considered strengths. They are only valuable if they enable a firm to enhance its competitive position.
RARE resources are those held by few or no other competitors. Strategic resources that are valuable or rare are valuable simply due to the relatively high cost of acquiring them (e.g., an airplane) or scarcity (e.g., diamonds).
DIFFICULT TO IMITATE resources often involve legally protected intellectual property such as trademarks, patents, or copyrights. Other difficult-to-imitate resources, such a brand names, usually need time to develop fully. Competitors cannot find alternative ways to gain the benefits that a resource provides.
Key Takeaways
Resource-based theory suggests that resources that are valuable, rare, difficult to imitate, and nonsubstitutable best position a firm for long-term success. Intellectual property can serve as a strategic resource for organizations. Capabilities are needed to bundle, manage, and otherwise exploit resources in a manner that provides value-added to customers and creates advantages over competitors.
Main references
Video lessons on Strategic Management provide as learning supporting material for the book Mastering Strategic Management: Evaluation and Execution, 1st Canadian Edition, Author Janice Edwards. This textbook is an OpenBook available at BCcampus Open Education. The web version of the Mastering Strategic Management – 1st Canadian Edition can be accessed at https://opentextbc.ca/strategicmanage... .
Barney, Jay B., and William S. Hesterly. "Strategic Management and Competitive Advantage: Concepts." Pearson, 2020
Barney, J. B. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17, 99–120.
Canadian Intellectual Property Office. (2014). What Is Intellectual Property? Retrieved from http://www.cipo.ic.gc.ca/eic/site/cip...
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Topics covered in this video:
Resource based theory, RBV, strategy RBV, RBV barnes, rbv internal analysis, what is rbv, strategic internal analysis, internal environment in business, internal environment in strategy, intellectual property, environment in management, types of intellectual property, patents, trademarks, copyrights, trade secrets, competitive environment, strategic assessment, business environment assessment, Strategic Management Lesson, What is strategy, define strategy, mastering strategic management,
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