Define the four characteristics of resources that lead to sustained competitive advantage as articulated by the resource-based theory of the firm.
2. Understand the difference between resources and capabilities.
3. Be able to explain the difference between tangible and intangible resources.
4. Know the elements of the marketing mix.
Table 4.1 Resource-Based Theory: The Basics According to resource-based theory, organizations that own “strategic resources” have important competitive
advantages over organizations that do not. Some resources, such as cash and trucks, arenot considered to be strategic resources because an organization’s competitors can readily acquire them. Instead, a resource is strategic to the extent that it is valuable, rare, difficult to imitate, and nonsubstitutable.
Strategic Resources Expansion
VALUABLE resources aid in improving the organization’s effectiveness and efficiency while neutralizing the opportunities and threats of competitors.
Although the airline industry is extremely competitive, Southwest Airlines’ turns a profit virtually every year. One key reason why is a legendary organizational culture that inspires employees to do their very best.
RARE resources are those held by few or no other competitors.
Southwest Airlines’ culture provides the firm with uniquely strong employee relations in an industry where strikes, layoffs, and poor morale are common.