Resource-Based View in Human Resource Management for Competitive Advantage

Human Resource Management 1
HUMAN RESOURCE MANAGEMENT
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Human Resource Management 2
1.0 How the Resource-Based View Can Be Adopted To Human Resource Management
to Help Deliver Competitive Advantage and Organisational Success
Due to global competition, viability, and the struggle for relevance, organizations
have been forced to adopt and utilize strategic approaches in their management practices
across all their business facets (Lin & Wu 2014). The field of the human resource, not an
exception. In the present human resource field, manager, and human resource management,
scholars are increasingly searching for the best way to establish the connection between
performance and human resources. The resource-based approach is one of the relevant
models which can help the managers to achieve organizational success as well as the
competitive advantage.
The resource-based approach is that a business’ capacity for competitive advantage
lies in the utilization and management of the available bundle of resources. This approach
describes the firm’s resources features based on four primary categories, which include:
value, inimitability, rarity, and non-substitutability. Firstly, the value represents the capability
of a firm’s resource to enable the firm in employing a value creation strategy, either by
preventing its shortcomings or by outperforming its competitors. Secondly, rarity suggests
that the resource should be rare for it to be of great value to a business. The support should
also be unique when it comes to availability for the other forms.
Third, the RBV model assumes that a firm can enjoy a competitive advantage if its
human resources have special skills, ability, and knowledge that is not easy to imitate. Thus,
inimitability describes the value attained from a resource when the organization's competitors
are unable to reproduce this strategic resource perfectly. Firms enjoy the inimitability
advantage due to isolating mechanisms. The isolating mechanism principle state that a firm
cannot duplicate a vital resource to compete with a firm which has that valuable resource
(Chae, Olson & Sheu 2014) For example, if the unique resource is based on social

Human Resource Management
complexities or knowledge, casual ambiguity will likely occur since these resources are
primarily exclusive to a firm in which they are found.
Finally, the resource-based model suggests that a resource has to be non-substitutable
for it to give the firm a competitive advantage. Even if a resource is perfect, rare, and
potentially creates value, it is the non-substitutability aspect that makes it useful is giving the
competitive edge to a firm (Lockett & Wild 2014). Lack of substitutes that would be taken up
by other businesses renders a, and it makes an organization achieve a high degree of success.
It is, therefore, worth noting that the four head criteria are individually necessary, but they are
not individually sufficient for a firm to gain a sustained competitive advantage.
The resource-based view approach helps a firm to achieve a competitive advantage
when the firm uses it to implement the value creation strategy, which is not easily
implemented by the competitors. All the resources available to the firm are not equally
important, and not all of these resources have the potential to give a sustained competitive
advantage to a firm (Szymaniec-Mlicka 2014). Therefore it would be necessary for a firm to
categorize its resources in order of competitive advantage attached to the resource. The
resources which create the competitiveness must pass the five tests which are inimitability,
appropriateness, durability, competitive superiority, and substitutability.
The human resource managers can adopt valuable resources which will enable their
organizations to achieve success in competitive advantage. They are termed as valuable if
they can reasonable the human resource managers to improve the firms process effectiveness
and efficiencies (Kramar 2014). There is a degree of complementarity between resource-
based view and the environmental theories of competitive advantage such as the SWOT
analysis. SWOT analysis highlights the resources available to a firm that will help it
neutralize the threats and exploit opportunities (Lin & Wu 2014). Therefore, human resource
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