international business lecture 4 firm resources, competitiveness and growth

International business lecture 4

Firm Resources, Competitiveness and growth

Resource Based view
 It focuses on firm’s internal resources.
 Liability od outsidership means that the more a firm differ
from the host environment, the less the firm has experience
of the host environment, the les the firm has experience in the
host country and further away its near prior affiliate.

Resources can be categorized in to 3-sub parts-
1- Tangible
 Financial
 Physical
2- Intangible
 Technology
 Reputation
 Culture
3- Human
 Skills
 Capacity for communication
 Motivation

Resources and sustained information advantage

To have the potential of sustained competitive advantage the firm
must have four attributes-
1-Valuable- The value of the resources can only be received when it
enables a firm to conceive of or implement strategies that improve
efficiency and effectiveness.

2-Rare- if the valuable firm resource is possessed by a large number
of firms then each firm has the capability to exploit that resource
and give no other firm competitive advantage.

3-Imperfectly Imitable- Value of the resource can only be a source of
competitive advantage.

4- Substitutability – for a firms resource to be a source of
competitive advantage it must have no strategically equivalent
valuable resource.


Porters Value Chain Analysis
The sequential chain of main activities that are undertaken by a firm