Business strategies frameworks in the strategic management field include the resource-based view, institutional view, and the industry-based view. The three views focus on three different terms. Firstly, the resource-based view will look at the internal resources. Secondly, the industry-based view is responsible for examining the environment in the industry. The industry-based view is similar to competitive advantage strategies since it determines the position of firms in the market. That is whether the firm will gain a competitive advantage by being a lowest-cost leader or a differentiator. The last view is the institution-based view, which focuses on the cultural differences and possibilities in the broad picture. The three aspects could work together to formulate a strategy for an organization. The Business strategy frameworks in the strategic management fieldwork work together to ensure an effective strategy for the firm.
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THE RESOURCE-BASED VIEW RELATION TO THE COMPETITIVE STRATEGIES
Some of the Business strategies frameworks in the strategic management field relate to porters’ competitive strategies. A resource-based view involves the selection of plans that best exploit internal resources relative to external opportunities and competition. Hooley suggests six different competitive positions one can take when utilizing a resource-based view of the organization. The price positioning, for example, relates to the competitive advantage strategies. Supporters of RBV posit that competitive advantage gets achieved best by utilizing existing internal resources. According to critics, RBV frameworks authors recommend the VRIO framework but do not mention how to go about it. RBV, therefore, is only a practical view when situated in a stable competitive environment. Though RBV plays a vital role in the strategic management field, strategic planning is still crucial.
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THE INSTITUTION-BASED VIEW AS ONE OF THE BUSINESS STRATEGIES FRAMEWORKS
The institution-based view emerged in the strategic management field after industry-based view and resource-based view. The emergence of the institution-based view is due to the globalization process affecting most industries in the last years. The rise has enabled increase in academic research, attempting to understand the origins of competitive advantage in the international context. The view, similar to Porter’s competitive advantage strategies, presents a variation difference in the institutional environment. It seems clear that institutional environment elements should give the highest differences when different countries are in the question. The business opportunity of the framework is accessible by considering issues deemed as necessary by the view. The institution-based view is the leading business strategy frameworks in the strategic management field.
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