| The purpose of the research is to extend the organizational strategy literature, in general, and the theory of the resource-based view (RBV), specifically. RBV seeks to explain the reasons that some firms establish competitive advantage over others. However, the scholarly debate about the resource-based view has been very general and, while there is some consensus about the qualities that enable advantage to be gained, widespread agreement has been more difficult to achieve.; This study was designed, to further the discussion about RBV and to offer some suggestions by which to make the theory more applicable. First, RBV, while it may have included an understanding of the firm's external environment implicitly, said little about the impact of demographic changes or shifts in market preferences. Second, the notion of the utilization of resources has recently gained some prominence in the strategy literature but has yet to become the focal point of the theory. Third, there has been continuing discussions about the meanings of the phrases "internal capabilities," "distinctive competence," and "dynamic capabilities." Fourth, there has been little empirical work in the area of the resource-based view.; Additionally, the strategy literature has yet to address the time lag between the point at which strategic initiatives begin and the time at which the results of those initiatives are seen on the firm's financial statements.; The initial step in the process was to develop the model that the RBV literature suggested and to formulate five hypotheses about the relationships that the model depicted. Then, in a study of 301 publically-traded United States, covering 1999 through 2002, those hypotheses were subject to regression analysis with the following results: (1) The firm's internal capabilities have a direct effect on the development and utilization of its distinctive competencies. (2) Those competencies have a direct effect on the firm's financial performance. (3) Population changes and shifts in certain economic rates may have a moderating effect on the development of the firm's competencies. (4) Its capabilities have a direct effect on its ability to utilize its resources. (5) Utilization of resources, then, has a direct effect on financial performance as well.; This study is unique in that it codified the resource-based view; quantified and supported the model, for the most part; and suggested that RBV can be expanded to be a comprehensive theory of firm performance, and not just strategy. |
