Features of Resource Based View Theory: An Effective Strategy in Outsourcing

Abstract

In Resource Based viewpoint theory (RBV), the resources possessed by a firm are the primary determinants of its performance. The resources may remain latent until the firm deploy its capabilities, with these may contribute to a sustainable competitive advantage. RBV in Human resource management aims in providing justification for attaching importance to especially talent management and aid in enhancing the value of the HR contribution in achieving competitive advantage by strategically fitting and bundling as HR best practices. Outsourcing is built from an organization that lacks Valuable, Rare, Inimitable, Organized resources and capabilities thus seeks for an external provider in order to overcome that weakness. In outsourcing, Firm’s performance in the marketplace depends on the different characteristics of the industry in which it compete and through innovation, persistent improvement and management of relationship with external entities may lead to sustain competitive advantage and be above average performance.