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Resource Based Theory (RBT)

 


RBT, or resource-based theory, is a well-known method for strategic management. In order for a company to maintain a competitive edge, it has been frequently used as a managerial framework to identify essential resources. The theory offers a crucial framework for deriving explanations for and projections of the basic drivers of a firm's performance and competitive advantage.

Penrose (2009) introduced Resource-Based Theory (RBT) for the first time by putting up a model for the efficient management of organisations' resources, diversification tactics, and business possibilities. The idea of seeing a corporation as a coordinated collection of resources to address and tackle how it might achieve its goals and strategic behaviour was first put out in Penrose's book.

RBT offers a framework to identify and foresee the core elements of business performance and competitive advantage. In response to prior managerial interest in the industry structure, a more macro viewpoint, RBT turned its attention to the firm's performance from a meso perspective. Instead of relying on externally driven techniques to comprehending the success or failure of leveraging organisational operations, RBT offers an internally-driven strategy by emphasising internal organisational resources (Kozlenkova, Samaha & Palmatier, 2014). It seeks to elaborate on corporate resources that are imperfectly replicable but might perhaps generate long-term competitive advantage (Barney, 1991). 

RBT has been adapted and implemented in various corporate management disciplines outside of strategic management, both qualitatively and quantitatively. RBT has so far been applied to a variety of business studies, including marketing (Barney, 2014; Kozlenkova, Samaha & Palmatier, 2014), operational management (Hitt, Xu & Carnes, 2016; Lewis et al., 2010), economics (McWilliams & Siegel, 2011; Ahmed, Kristal & Pagell, 2014), supply chain management (Zimmermann & Foerstl, 2014; Ahmed, Kristal (Molloy et al., 2011).

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