Limitations of Resource Based View of the Firm

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Andrey Mazkun
What are the limitations of RBV? Can anyone clearly explain it? Thanks. (...) Read more? Sign up for free

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  Christos Papadimas, Manager, Canada
 

Limitations of RBV

One limitation of the RBV theory is based on the inability to compile an empirical study to measure performance. Due to the heterogeneity of the companies, it is hard to impossible to compile a homogeneous sample.
Furthermore, the RBV does not consider the demand side of the market. A company might have the resources and capabilities to produce competitively but who is the customer/consumer?

  Warren Miller, CPA, CFA, United States
 

Limitation of RBV

The limitation of the RBV is that it's applied on an entity-specific basis. Therefore, it is not generalizable.

  Maryam Bidmeshgipour, Student (Other), Malaysia
 

Limitation of RBV

I agree with Warren on this limitation of RBV. As a result there is still no generalized tool that is able to measure it.

  Warren Miller, CPA, CFA, United States
 

Limitations of RBV

I respectfully disagree, Maryam. There is a tool that can measure capabilities, whose development is central to deploying the RBV. That tool is Jay Barney's VRINO (valuable, rare, inimitable, non-substitutable, organizationally aligned) framework.
Asking five questions (one for each letter in the acronym) will help gauge the durability of a capability and also its staying power against other capabilities in the competitive domain (industry or strategic group). I use it all the time, and it is powerful.

  Emad Hassan, consultant, Egypt
 

Limitation of RBV

The main limitation, from my perspective, is that (...)

  Warren Miller, CPA, CFA, United States
 

Limitations of RBV

Emad, I'm not sure about what you mean with "endog (...)

  Emad Hassan, consultant, Egypt
 

Endogenous Value Perspective

Warren, thanks for your comment. What I meant by e (...)

  J Iqbal, Professor, Pakistan
 

Generic and Specific Limitations of RBV

All those factors that inhibit implementation or r (...)

  Michael Park, Strategy Consultant, United States
 

Limitations of RBV

Hi, this discussion, like many things on this site (...)

  Warren Miller, CPA, CFA, United States
 

Limitations of RBV

@Michael: please clarify what you mean by "directi (...)

 
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Summary
Forum
Can 'Product Design Capability' be a Resource for an Organization?
🔥Relationship Between Isolating Mechanisms / Barriers of Imitation and Company Size
Resource Based View Identifies Core Competences
Best Practices
🥇Resource Based View Industries?
🥈Barney Changed VRIN into VRIO
Limitations of Resource Based View of the Firm
Sources for Resource Based View
Advantages of RBV (benefits)
RBV & Financial Capability
Challenges of Managing Conglomerates...
Extended RBV Approach
Relevance of RBV When Facing Low Cost Competition
Strategic Resource Planning
Empirical Research of RBV
Example RBV - Engineering Firm
RBV and Comparative Advantage
RBV in Micro Business?
Resource Based View of the Firm and SWOT
The Conditions of RBV are Seemingly Non-Complementary
Special Interest Group Leader

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