Resource Based View in HRM and its Application in the UK: An Essay

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Essay on Managing Human Resources
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Table of Contents
Introduction......................................................................................................................................3
1. Explain how the “Resource based view” may be adapted to HRM to help deliver the
competitive benefit..........................................................................................................................3
2. Two major threats recently facing by the companies in UK labour marker...............................7
Conclusion.....................................................................................................................................10
References......................................................................................................................................12

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Introduction
Company mainly controls with the two ingredients i.e. sources and goods, or service that are
resulting from the sources simply. From the concept of RBV (resource based view), the
resources of firms may be estimated as determinant to gain the competitive benefit from the
market. Further, it also presents the firm’s performance based on resources. In the year of 1984,
Birger Wernerfelt introduced the “Resource based theory”, which considered the significance
of sources within the firm. From the concept, the primary statement indicates that heterogeneity
of company is reliant of the heterogeneity of sources in which they organize. Further, it intends
that heterogeneity of sources persevere in a company, as the activities would not be transportable
around the firms. As a result, it assumes that resource is significant in favour of the company to
attain Competitive edge within the market. Resource based view also determines the sources that
are accessible in the company and connects those sources with the activities of firm within a
silent way. As per this theory, competitive benefit may be delivered towards a firm while the
firm is capable to use its sources in a unique manner, along with the other competitors of the
firm.
1. Explain how the “Resource based view” may be adapted to HRM to help deliver the
competitive benefit
The resource based view takes from the firm-specific perspective in which the firm may succeed
or fail within the market. As argued by Stahl et al. (2012), resources are rare, non-sustainable,
inimitable and valuable, as it make possible for the business to maintain and develop the
competitive advantage within the market. However, a resource should fulfill the criteria of
“VRIN” to attain sustainable performance and competitive advantage. A VRIN principle is
explained below:
Value: As noted by Zhang et al. (2012), resources are accessible, if it gives the strategic value
towards the organisation. Additionally, resources give value if it supports the firm to exploit the
market benefits or reduces the marketing threats.
Rare: In case of a firm, resources should be a complex aspect to decide between the potential as
well as existing competitors within the market. Thus, resources should be unique or rare to give

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competitive advantage. In the market, resources are acquired by different organisations, as it may
not give the competitive benefit.
Inimitability: According to Agrawal et al. (2012), inimitability means that the resources would
not feasible for the firm. Resources may be the basis of sustained advantage, if the firms do not
hold these sources.
Non-sustainability: It implies that sources may not be substituted by another source within a
firm. Thus, competitors may not attain similar performance by replacing sources with other
sources.
As opined by Iles et al. (2012), resource-based view interprets and analyzes the sources of
organisations to understand how they attain competitive edge from the market. In other words,
resource based theory is estimated as one of the process that is mainly based on the inside-out
strategy. However, the theory clarifies that all the firm have obtained excellent capability is due
to non-suitable and extraordinary sources accessible towards the firm. This brings the company
with more achievement within the emerging financial condition of the world. As noted by Marler
and Fisher (2013), the strategy mainly focused on several methods in which the firms gather
other sources from the market. The following figure is given below to describe the process of
resource-based theory:

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Figure: Resource-based approach
(Source: Marler and Fisher, 2013)
There are two factors, which would be the inter-dependent terms in resource based theory i.e.
capability and sources. As cited by Lengnick-Hall et al. (2013), resources are the input factors
without which the process of production will end up towards a limit. As per recent condition, the
main sources utilised within a company are human sources, capacity of new technology, raw
materials, financial supports and the loyalty of consumers. Besides, patents and brand image may
be estimated as the significant resources for a firm. As argued by Jamali et al. (2015),
capabilities are observed as the capacity of accessible sources with the company and the methods
through which tasks are performed in a firm. These two factors are responsible for determining
the competitive benefit availed by the company from the market. On the other hand, the
resources may be separated in case of tangible and intangible sources and both sources are
significant for appropriate functioning of the firm. This theory is estimated to be one of the
substantial theories of the HRM.

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Resource based theory tends to develop the view of firm that if resources are valuable, then it
may be act as a source of competitive benefit for that firm. At the similar time, the company is
also capable to evaluate the probable sources that may give more benefits towards the firm. It
also enables achievement within the emerging markets. According to Akingbola (2013), resource
based theory also initiates the organisation to understand whether the sources are expensive in
the direction of expected level of market. Additionally, the accessibility of sources is checked in
the firm through this approach. The competitive benefits are also attached to the sources, which
would further evaluate by the firm. The firms must understand the value of those resources, as
they are unique in nature and not accessible towards the competitors.
To gain the organisational success
Resource based operation allows the firm to develop innovative products as per the demand of
consumers. It also enables the sustainable development in the organisation. As argued by
Vandenabeele et al. (2013), the competitive environment and resources are also beneficial for
acceleration of the achievement of organisational development. At the same time, it also supports
the HRM to attain the organisational objectives efficiently. In the recent tine, strategic managers
must be part of competitive benefits where they may analyse the significance of exterior and
interior resources. These resources support them to gain innovations and opportunities in the
firm. As outlined by Helfat and Peteraf (2013), resource-based view is a dynamic approach,
which enables the company to operate, act and enact as per its exterior and interior sources and it
also supports to gain the organisational success in the market.
RBV mainly targets on the interior factors, which may contribute towards the performance and
growth of a company. It also emphasizes on the significance of firm’s abilities and resources.
These factors are formed a competency, as it would create organisational success for the firm. To
survive the competitive world, an organisation requires to fully developing themselves to attain
the sustainable benefits. As cited by Kraaijenbrink et al. (2010), resources are being valuable,
imperfectly mobile, rare and non-sustainable to attain the organisational success. Further, RBV is
a method in which a firm develops their organisation structure effectively to attain the success
within competitive market.
HRM theory in terms of organisational success

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To be efficient within the international market, HRM departments increasingly act as strategic
partners with other companies within the firm. Hiring, interviewing and recruiting mainly depend
on better communication among managers in all the branches of that firm. The theories are
connected with HR management engages all the activities of HR to attain the organisational
objectives and goals (Hair Jr et al., 2015). As per motivation theory, HR professionals utilize the
industry association resources and tools towards benchmark of employee’s performance against
any standards. By reviewing the operating models of other companies, HR professionals support
to recognise the gaps in terms of employee’s performance. They may design, implement and
develop the training programs to obtain the employees on track.
A strategic HR section makes sure that the firm has needed the personnel aspect towards execute
the mission of company. It performs different strategic functions to support executive leaders as
they communicate the main values of company (Dunning, 2015). These functions supports in
understanding that employees have the necessary knowledge, credentials and skills to control
safely in their respective jobs. By giving the proper rewards, an efficient HR retains and attracts
the most skillful employees for the companies. However, strategic HR performs with executive
managers to define the operational measurements for the company.
Good practices of resource based view
Honda is the largest car manufacturer around the world for following the RBV approach. Honda
develops its marketing strategy around the aspects such as company’s capability, expertise and
strength. In case of Honda, the resources are the productive assets as those belonged from the
company and separated in intangible and tangible sources. The performance of Honda depends
on how the sources are being used by them (Bloom et al., 2015). For example, Honda acquires
the tangible fixed assets with a worth value of 9 billion in the automobile sector. Resources are
motivated to HR mangers, as they differentiate the company from the competitors and gain the
competitive benefit from the market. In Honda, both capabilities and resources are together
formed its competency that may be leveraged towards develop the competitive benefit.
Toyota is another example of RBV approach. The company uses capability and resources to
form its capability as they go ahead from other competitors. Toyota has separated themselves
from other competitors, as they give superior products to their existing consumers. This supports

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the company to obtain the value creation between consumers. In these methods, the company
may change their organisational model to obtain more profit in the market (Culpepper and
Reinke, 2014). Toyota also keeps on upgrading and learning their capabilities and sources to stay
ahead from the rivals. However, Apple has also utilized RBV method as they outperform from
their rivals. The company also utilizes heterogeneous resources and capabilities while developing
and innovating the items within the market. The softwares of Apple are developed for its
hardware and the resources are non-sustainable, hard and rare to imitate. This gives Apple
competitive benefit, as they separate itself from other companies. Apple is well known for their
quality that benefits towards the market and gain a large base of consumers.
2. Two major threats recently facing by the companies in UK labour market
Threat of Brexit
As opined by Hohenstein et al. (2014), Brexit gives one of the clearest threats towards the
organisations in the UK-based labour market. Brexit would effect on economy, remittances and
trade of an organisation and it might have negative effects for the developing nations. However,
a slowdown within the UK economy would give the negative implications for the developing
countries. It also leads towards slower development of inward investment, remittances and
export services for the company. For instance, a loss of financial confidence within UK market
would have the biggest negative impacts on a wider range of countries such as investment,
growth, jobs and reducing the exports. This is an awful uncertainty for the companies to endure.
The labour market outlet and talent planning surveys are closely monitored the effects of Brexit
on workforce and employment trends. In the year of 2016, low employment and strong demand
of labour is a dramatic fall in UK labour market and it has put the significance pressure on the
process of recruitment (Jackson et al., 2014). From the statistics, it is estimated 95% fall of
employment in the UK based labour market. As noted by Ahmad (2015), 45% of workers have
experienced huge complexity in the process of recruitment during the year of 2018 while 34%
have faced the same challenge to retain their staff.
In UK, the prevalence of hard-to-fall vacancies has exponentially increased. At autumn, 70% of
worker with the vacancies indicate that at least some of those were supposed to give their best
for filling the vacancies, as compare to 51% in spring, 2017. From the survey planning, it has

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reported that around one-fifth of companies have seemed an enlarged cautiousness within the
prospective participants. As stated by Stone and Deadrick (2015), three-fifth employers are
expected that they may face enlarged complexity to recruit senior and technical within the next
some years. These types of expectations have been assembled with the labour force in the region
of UK. Further, the number of applicants in all skill levels has fallen significantly within the
market. The effect of Brexit is based on an assumption that the trade among UK and EU regions
have fallen by 2%. Job shortfall is not similar as the employment loss. Further, it estimates that
new deals of in introducing for making up the Brexit impact.
According to Cooper et al. (2014), over last few years, Britain has voted for leaving the EU and
it is one of the most talked and controversial aspect in terms of political movement. This activity
has been reflected across several sectors and industries as per the report. The total migration has
fallen by 95% within the last year and resulted on the EU workers to complete the active roles
within the company. As noted by Brewster et al. (2016), low labour supply may signal a pay
boost for lower paid roles. It would also make a shortage of employees for specific companies.
IT, construction and Transport companies have been reliant on the non- UK employees to
complete the vacancies. Industries must focus on retaining and sourcing of quality talent for the
better development of nation. In UK, it has found that corporate sectors hold back from the
capital expenditure and hiring because of uncertainty over the future connection of UK with EU.
However, the credit cost has risen towards its high level for last few years.
Brexit has been a significant source of uncertainty for many UK industries. As cited by Renwick
et al. (2013), Brexit has directed towards a 7% reduction within the process of investment in last
two years after referendum. Besides, it would like to decrease the future production of UK. The
majority of businesses have expected that Brexit would eventually decrease the sales and enlarge
the costs of manufactured items. Thus, Brexit is a significant and growing factor in terms of
uncertainty for the firms. As noted by Dunning (2015), industries have expected that Brexit have
eventually reduced the sales by around 3%. These impacts on the exports that are expected to be
negative, while labour costs, economical costs and labour prices were anticipated to increase.
Brexit has already decreased the investment and the growth of employment.
Threats of cyber attacks

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As opined by Kramar (2014), privacy of data and security has been top safety estimate than any
other company’s issues. For providing huge space in the social sites, customers experience very
safety when interrelates with their friends and families. For the home users, the criminals of
cyber world will continue to aim social sites, which would steal the personal information. From
the report of cyber security incident in UK, it seems that spam, cyber harassment, fraud have
enlarged in many areas than the Denial Service or others susceptibility reports. As discussed by
Renwick et al. (2013), from a report of UK technology, it has been found that cyber crimes have
certain serious threats for the organisations and industries. Whereas it is also seemed that 99% of
MNC organizations is increasing the cyber security and half of them are raising the sources to
online foes.
As noted by Stone and Deadrick (2015), threats have been seemed within the cyber attacks on
web method for allocating malicious or extracting the information. The MNCs and SMEs are
slowly taking Cloud services in their system. However, the latest trend has exposed for the large
challenge for the cyber security and it may be interchange going in the region of traditional
intersection. In spite of the steady warnings from the cyber security, companies might be fall
causality to phishing every day. As argued by Dunning (2015), cyber crimes have been
complicated and funded, it remain an effective method, which is utilized by attackers for
beginning malware into the business. For example, a well-focused point phishing email may
induce the employees to yield customers password and information. However, some of workers
may not know to protect themselves from online attacks and this may certainly place the industry
at risk.
In companies, hackers are aware of the complacent nature of small scales while it occurs towards
cybersecurity. Large companies have a robust defense, which is complex towards compromise or
breach. However, most of the larger companies have the systems that are connected with small
or mid-size businesses. APTs are the new cyber attacks whereas the network security capabilities
such as IPS and the process of filtering have acted as a different role to identify the targeted
criminals. However, the mobile systems are horizontal to the cyber attacks that require being
undertaken safety in case the security problems. As outlined by Hohenstein et al. (2014), IoT is
undeniable the future aspect of technology as well as the company. It has also opened new

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advantages for the cyber attacks. Besides, it is imperative for the workers for make sure that all
IoT devices are setting up correctly and there is no room for the network breach.
On the other hand, if the third party hacks the data, the industry should be at the position of high
risk to misplace the business information or negotiate the workers information. For example, it is
observed that in 2017, targeted data breaches have included about 50 million consumer’s
accounts that were affected due to high quality network service, hacked by the third parties and
air conditioned vendors (Brewster et al., 2016). In the region of UK, it has been shown as the
cyber attacks are adopting the application of corporate security, which may enlarge effectively of
attacks. In case, criminals in the enterprise are licensing and selling hacking applications to less
complicated cyber criminals. For example, the particular criminals have zero technology that
will open the marketplace heavily.
Conclusion
From this report, it will be assumed that RBV deal with the competitive environment of business
that is faced by the firm. It starts with the analysis of internal environment. In case of some
companies like Toyota, and Apple, RBV is often estimated as the alternative model of Porter’s
five forces. Resource-based view mainly highlights on the internal sources and capabilities of
company in generating the strategy towards the competitive benefit within the marketplace. In
this report, two major threats are analysed that currently are facing organisations while operating
within the United Kingdom labour market.

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References
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Akingbola, K., 2013. A model of strategic nonprofit human resource management. Voluntas:
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Bloom, N., Propper, C., Seiler, S. and Van Reenen, J., 2015. The impact of competition on
management quality: evidence from public hospitals. The Review of Economic Studies, 82(2),
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Brewster, C., Chung, C. and Sparrow, P., 2016. Globalizing human resource management.
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