¶ … resource attainment for stimulating growth, value as well as gaining of competitive advantage in startup organizations.
Resources are a crucial part of every organization. According to the resource-based view (RBV), an important tool for evaluating a firm's strategic resources, resources are important and therefore form the core elements of strategic advantage. Wernerfelt ( 1984, p172) and Rumelt (1984, p557-558) points out that firm's ability to grow and attain a competitive advantage is dependent on the value of the internal and external resources that is at its disposal. The transformation of these resources to meaningful competitive advantage demands that the resources be heterogeneous and to lack perfect mobility (Barney,1991).
Background and statement of the problem:
Resource-based view of organizational management is quickly gaining dominance in these economically hard time. The U.S. Small Business Administration statistics shows that over half of new small businesses startups fail in the initial year. It is therefore necessary for a business venture to acquire sufficient resources necessary to allow it to grow, create value and attained a competitive advantage. The sector therefore lies in the manipulation of the resources necessary for attaining the three factors named above (growth, value and competitive advantage).
Barney (1991) while referring to Daft (1983) defines a firm resource as including all the assets, organizational processes, capabilities, firm attributes, knowledge and information among several other things that are controlled by a firm, enabling the firm to conceive of and put into practice policies that are capable of improving its effectiveness and efficiency (Daft,1983)."
A consequent distinction that was made by Amit & Schoemaker (1993) is that the surrounding construct that was previously called resources is capable...
In this regard, resources can be traded with and are also non-specific to the organization, whereas capabilities are specific to the firm and are applied to keep the resources within the organization, like inherent processes to move knowledge within the organization (Makadok, 2001; Hoopes, Madsen and Walker, 2003). This peculiarity has been broadly accepted all over the resource-based view writing (Makadok, 2001; Barney, Wright and Ketchen, 2001, Conner and Prahalad, 1996).
Makadok (2001) highlights the difference that exists between resources and capabilities by referring to capabilities as a unique kind of resource, explicitly an organizationally entrenched non-transferable organization-specific resource whose function is for the improvement of the productivity of other resources that are possessed by the organization (Makadok, (2001)) Resources are stocks of obtainable factors that are controlled or possessed by the firm, and capabilities are a firms capacity to organize resources (Amit & Schoemaker, 1993).
Competitive advantage
A competitive advantage is capable of being attained if the present approach is value-creating and not presently being put into practice by current or probable future competitors (Barney, 1991). Despite the fact that a competitive advantage is having the capacity to be sustained, this is not essentially the case. A rival firm may get into the market with a resource having the capability to annul the preceding firm's competitive advantage, which results into reduced rents (Barney, 1986b). Sustainability in the circumstance of a suitable competitive advantage is autonomous regarding the time frame. Relatively, a competitive advantage is applicable when the labors by competitors to make the competitive advantage outmoded have stopped (Barney, 1991; Rumelt, 1984,). When the…
