Resource Based Strategy

The Resource Based View of strategy, popularised by Gary Hamel in the 1990's emphasises the need to focus on what you can control, namely, your internal resources. Most companies are 'price takers' in that they cannot influence the market price and have to occupy a niche in the sector.  The Resource Based View helps you to understand 'why' and 'how' your company can survive and grow.  

The Two Pillars of RBV

To understand your strategic advantage, RBV divides your internal ecosystem into two categories:

Tangible Assets: The physical things you can touch and quantify. This includes your real estate, manufacturing equipment, raw materials, and financial capital.

Intangible Assets: The non-physical, deeply embedded elements that are much harder for competitors to replicate. This includes your brand reputation, intellectual property, proprietary software, culture, and organizational trust.

Strategic Insight: While tangible assets can often be bought on the open market, intangible assets are typically the true goldmines of sustainable competitive advantage.

The VRUA Model:

Framing your Edge

Not every resource gives you a strategic edge.

To determine if a resource can truly sustain your business against competitors, RBV applies the VRIO framework:

  1. Valuable: What does this resource do for your organisation?
  2. Rare: How scarce is this resource?
  3. Unique:  Is this resource unique to you, or does everybody have it?
  4.  Aligned: How does this fit into your organisation?

Why RBV Matters for Your Business

By shifting your focus from what the market is doing to what your business is uniquely capable of doing, the Resource-Based View allows you to:

Stop Competing on Price:
Lean into unique capabilities that competitors can’t match, allowing you to command premium value.
Optimize Asset Allocation:
Stop wasting capital on generic tactics and double down on the rare skills and technologies you already possess.
Build Resilient Strategies:
Market trends fluctuate, but a deeply embedded internal capability (like an agile R&D team or an fiercely loyal customer base) remains resilient through economic shifts.

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