RBV

The Resource-Based View (RBV) is a theoretical framework in strategic management and organizational theory that explains why some firms achieve sustained competitive advantage largely through their internal resources and capabilities rather than external market conditions. The central premise is that firms differ in ways they control valuable resources and the ways they deploy them.

Resources can be tangible (machinery, real estate) or intangible (brand, reputation, knowledge, organizational culture). Capabilities are the firm’s processes that integrate and leverage resources to perform activities. A resource or capability can confer sustained competitive advantage if it satisfies the VRIN criteria: valuable, rare, inimitable, and non-substitutable. Resources that are valuable exploit opportunities or neutralize threats; rare means not widely possessed; inimitability arises from unique historical conditions, causal ambiguity, and social complexity; non-substitutability means no strategically equivalent substitute exists.

Beyond static resources, the RBV emphasizes dynamic capabilities—the ability to reconfigure resources in response to changing environments—and ongoing resource development, learning, and upgrade to maintain competitive advantage.

Origins trace back to Penrose's work on firm growth and were refined in the modern form by Prahalad and Hamel (1990) and especially by Jay B. Barney (1991) with the VRIN framework. The RBV has influenced research and practice by highlighting internal strengths as sources of advantage, guiding resource audits, strategic investments, and capability building.

Critics note challenges in measuring resources, isolating causal links to performance, and the risk that focusing on internal factors underemphasizes industry structure and external shocks. Nonetheless, RBV remains a foundational lens in strategy, guiding firms to cultivate valuable, hard-to-imitate resources and capabilities.