Evaluate each level of strategy the way organisations would consider and apply RBV

Question 1

What hierarchical levels does strategic management represent?

Answer 1

Functional level, Business level and Corporate level

Question 2

What is RBV? (brief explanation and author)

Answer 2

RBV - resourced based view (Barney (1991)), focusses on internal firm resources as a foundation for achieving sustained competitive advantage, provided they are valuable, rare, inimitable, and non-substitutional (VRIN).

Question 3

What does this essay evaluate?

Answer 3

How orgs interpret and apply RBV at each hierarchical level, critically assessing strengths and limitations.

Question 4

What does RBV do at corporate level?

Answer 4

At corporate level, RBV informs decisions about portfolio composition and acquisitions and diversification, by highlighting core competencies that are transferable across the business.

Question 5

Explain application of RBV at corporate level?

Answer 5

Corporate execs evaluate whether internal resources such as brand rep, patent tech or logistical infrastructure can be leveraged in new markets. eg Amazon expanding in new sectors by leveraging core logistics and data capabilities.

Question 6

Evaluation of RBV applied to corporate level?

Answer 6

RBV encourages strategic coherence across units. However it risks over-estimating how transferable resources are. Core competencies may not be applicable in all settings as much as they might think. This could result in issues such as failed diversification. In addition to this, it may neglect particular markets potentially leading to strategic blindness.

Question 7

Explain RBV at Business level?

Answer 7

At business level, strategy revolves around how to compete in specific markets or industries. RBV focusses on trying to identify and exploit internal capabilities to gain competitive advantage.

Question 8

Evaluate RBV at business level?

Answer 8

RBV supports tailored strategic positions based on what the firm does. CA based on internal resources. Can errode due to tech change, or competitor imitation/ substitute. RBV does not consider resources are not static, change. Risk in volatile market.

Question 9

Application of RBV at Business level?

Answer 9

Managers use RBV to determine how distinctive assets can be leveraged to pursue cost leadership/ differentiation. For example Toyotas operational excellence is a source through lean manufacturing.

Question 10

Explain RBV at Functional level?

Answer 10

At a functional level, RBV manifests in the execution of strategy, focus on progress, routine and human capital, how they can deliver strategic objectives.

Question 11

Application of RBV at Functional level?

Answer 11

Emphasis on tacit knowledge,skills and efficient workflow. Resources support firms day to day advantages (eg knowledge sharing, customer responsivness ect).

Question 12

Evaluation of Functional level?

Answer 12

RBV helps recognise strategic value of frontline capabilities, Excecution risks are often underestimated. RBV also does not account for resources that lose relevance without DCT development and application.

Question 13

RBV hierarchical application conclusion

Answer 13

• RBV powerful tool to understand CA across levels in strategy.
• Corp level: guide resource led diversification
• Business level: drives market positioning using distinctive competencies
• Functional level: supports effective execution through human resources and process resources.
• Limitations: static view, lack of external focus, other frameworks (eg porters) not considered. Strategic integration done well across all levels can lead to sustained CA.