How HR can create competitive advantage for the firm : Applying the principles of resource-based theory

Purpose This paper aims to demonstrate the practical application of resource-based theory to the work of HR practitioners and to show how employees can be a direct source of competitive advantage for the firm. Findings The popular models of competitive strategy seem to reduce employees to invisible units of production – an inconsequential, undifferentiated mass. Even criticisms of Porter’s model do not appear to notice that he forgot about the workers. The idea that a firm’s internal resources, especially its employees, could play a part in generating competitive advantage is not considered. This is despite a great deal of scholarly research demonstrating that employees do not just contribute to competitive advantage; they can themselves be a direct source of competitive advantage. Originality/value This paper is valuable to HR practitioners, HR consultants, organizational development specialists and strategic planners.