THE RESOURCE-BASED VIEW (RBV) OF THE FIRM

http://academlib.com/3585/management/resource-based_view_rbv_firm#954 An alternative perspective and a more recent entrant into the theoretical discussion of strategic management is the RBV of the firm. In essence, the RBV of the firm significantly differs from Porter's environmentally focused strategic management paradigm in that it emphasizes the firm's internal resources as the fundamental determinants of competitive advantage and performance. Thus, the RBV of competitive advantage is firm specific, whereas Porter's work had a decided industry-environment focus. With its historical roots in the organizational economics literature and the works of Ricardo, Schumpeter, and Penrose, one of the fundamental aspects of RBV is that the ultimate purpose of the firm is to maximize economic rent.20 This encourages corporations to continually extract resources from less-valuable legacy operations and steer them toward profitable innovation.21 ...