RBV And Five Forces Model

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Introduction

‘Saving people money so they can have a better life.’ (S. Walton, founder of Wal-Mart) is both the company’s slogan and the essence of its corporate mission. Since 1990, the chain has been the leader of the american retail industry, their success is assimilated to the innovative corporate strategy of relying on both the firm’s capabilities and resources.

1) Position of the article in the strategy debate

Richard Lynch (2006) defines corporate strategy as the focus on the ‘organisation’s basic direction for the future: its’ purpose, ambitions, resources and how it interacts with the world in which it operates. The article’s position in the wider strategical discussion is in the firm’s strategy to obtain and sustain competitive advantage, particularly putting in perspective the Positioning verses Resource Based View (RBV) debate, with the example of Wal-Mart. This debate opposes two classical schools of thoughts : the positioning school represented by the Five Forces model (Porter, 1980) and the resource based school which concept was first introduces by Selznick (1957) and Penrose (1959), ‘put in debate’ by Wernerfelt (1984) and developed into a framework by Barney (1991) which identifies a company resources as essential characteristics for a sustainable competitive advantage.
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However, they differ in their strategy for reaching said goal. RBV will encourage companies to develop this position by operating internal resources and capabilities as opposed to looking at external factors (Porter, 1980). From the recent literature emerges a new concept: combining the integration of these two approaches to strategy and focusing on the firm’s capabilities to create a sustainable competitive advantage. Honda implemented this strategy focusing on micro-processes such as new product realisation, dealer management and innovation. (Weerawardena,

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