Implementation of Resource-based View by Human Resource Management

Managing Human Resource
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Introduction
The primary purpose of the paper is to demonstrate the implementation of the Resource-based
view (RBV) by Human Resource Management (HRM). It will discuss the usefulness of RBV
that helps deliver organizational success and sustainable competitive advantage. RBV is
determined to be a tool that is utilized to consider the strategic resources available to a firm. The
value and significance of RBV depend upon strategic managers. With the help of relevant
examples, it will discuss the adoption and use of RBV by HRM.
Moreover, the paper will also focus upon the two major threats that are facing by the
organizations within the UK labor market. Based on these threats it will discuss the challenges
facing by the organizations that put a negative impact on their economic condition and
performance. Therefore, the examples will help identify the threats or challenges and based on
that it will provide appropriate recommendations.
Adoption of Resource-Based View to Human Resource Management
The resource-based view (RBV), is determined to be a managerial framework that is used to
consider the strategic resources with an ability to deliver a competitive advantage to an
organization. To gain a sustainable competitive advantage, these resources are utilized by the
organizations. In an effort to recognize the competencies, capabilities, and assets to deliver
competitive advantage and the organizational success it focuses upon the managerial aspects of
the internal resources of the organizations. However, Human Resource Management (HRM),
adopts RBV as it helps in understanding the situations under which human resources became
strategic assets, organization-specific, and valuable and scarce (Bromiley and Rau, 2016). Most
of the researchers argue that it is the manipulation and range of an organization resources that
includes human resources that provides an organization its source of sustainable competitive
advantage and uniqueness. It also helps in developing and building extraordinary bundles of
technical and human resources that result in sustainable competitive advantage and improved
organizational performance. HRM implements RBV as it helps identify the HR function as a
significant strategic player in enhancing the organization's human resources and sustainable
competitive advantage (Tempest and Coupland, 2017). It also helps in recognizing the
performance and productivity that can be improved by receiving more result from given
resources and similar results from a few resources.

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Moreover, 65% of the organizations adopt RBV as it concentrates on building and defining core
capabilities and competencies that are extraordinary as compared to their competitors. This
clearly states that RBV helps organizations to differentiate itself and stay ahead of their
competitors. It anticipates the future of an organization by competing for opportunity share along
with market share, regenerating strategies as well as focusing on organizational transformation.
RBV possess four dimensions such as values and norms, managerial systems, technical systems
along with knowledge and employee skills (Marler and Boudreau, 2017). All these dimensions
focus upon incentive systems and employee development that becomes a major driving force in
gaining organizational success and sustainable competitive advantage with the help of core
capability. The RBV of HRM has identified that both organizational processes and human capital
may add value to an organization’s success. However, when they mutually support and reinforce
each other, they become more powerful. In assisting organizations in gaining competitive
advantage and ensuring that exceptional value is attained the role of HR lies within the capability
to adopt a mutually and integrated reinforcing HR system (Zhao, 2015). Such HR system makes
sure that talent, when recruited is managed, rewarded and developed to meet their full potential.
Moreover, when the external environment of an organization is less predictable RBV approach
serves more added value. For instance, Block and Quayle (B&Q) in the UK, is determined to be
a good example of how a firm could differentiate themselves partially from their rivals by
focusing upon the added value through skills and knowledge of their HR (Rubery, Keizer and
Grimshaw, 2016). The company employs more talented and mature individuals as both their
peripheral and core workforce is highly engaged in making efficient use of RBV. As a result,
leverage is achieved as the knowledge of HR of B&Q add value to the provided customer service
level that in turn theoretically enhances shareholder value and consumer retention.
It is essential to adopt the RBV approach as in the highly competitive context organizations deals
with increasing product-market competition, changing demands of the customers and
globalization of markets. All these factors put a significant impact on the appropriate
management of the business operations to gain competitive advantage. RBV enables the
organizations to consider human capital or HR as a major source of competitive advantage
instead of the cost that allows organizations to invest a considerable amount of asset to generate
superior performance (Krishnan and Scullion, 2017). As per the researchers the organization’s
resources are considered to be the stocks of available factors that are controlled or owned by the

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form. For example, the resources of Unilever are transformed into final services or products by
making use of a huge range of bonding mechanism (Stiglitz, 2017). The products or services are
also converted by using other assets of the organization like trust between labor and
management, incentive systems, management information systems, and technology. This clearly
states that the organization possesses the ability to make efficient use of organizational processes
such as intangible and tangible along with information-based processes (Bénabou and Tirole,
2016). Therefore, adoption of RBV helps HR of Unilever to exchange, carry and develop
information within the organization’s human capital.
However, the organizations that possess various capabilities and resources are not sufficient to
gain success. The emergence of competitive advantage from distinctive capabilities or resources
that are controlled by the firm especially does well as compared to the rivals (Makridakis, 2017).
RBV theory suggests that the traditional sources of competitive advantage like economies of
scale, technology, and natural resources generate value as compared to a complex social
structure like an employment system. Thus, accurately developed HR systems could be a major
source to gain a sustainable competitive advantage for most of the organizations (Bondarouk,
Parry and Furtmueller, 2017). This particular RBV model also states that the organizations that
know how to develop an HR system that integrates HR practices and policies to maintain and
create the strategic human capital may receive a sustainable competitive advantage. It also states
that the organizations that develop attractive HR programs an appropriate selection system such
as, various development opportunities and greater than compensation packages can maintain,
select and attract the highest quality pool of resources. Therefore, with the adoption of RBV, the
HR system could be developed accurately that is embedded within the operating system of a firm
that enhances an organization's capabilities. For instance, HRM of Tesco in the UK implements
RBV that helps in developing significant resources that include its customers and suppliers
(Pucciarelli and Kaplan, 2016). This helps Tesco to sustain and gain competitive advantage by
evaluating its major resources that span the boundaries of the organization. Tesco extraordinarily
uses combine resources and makes relation-specific investments to achieve competitive
advantage and create relational rents in comparison with its competitors. Hence, with the help of
this example, it has been observed that RBV advances the significance of the specific resources
of an organization that helps in maintaining other resources and market share of a firm