Resource-based view of the firm

The resource-based view clarifies to what extent organizational resources affect strategic performance differentials among firms. The resource-based view (RBV) assumes that firms are administrative organizations involving collections of physical (human) and intangible assets or, synonymously, bundles of idiosyncratic resources and capabilities. The RBV has evolved from economic theory and explains the role of resources that are available to a firm in pursuit of a sustainable competitive advantage. Jay Barney formalized the RBV by drawing on the work of Birger Wernerfelt, who in 1984 introduced the notion of resource position barriers; these in turn are generally related to entry barriers in the ?five forces? model of Michael Porter's positioning school, which focuses primarily on the company's external competitive environment without an explicit account of internal firm resources.