What is the primary focus of the resource-based view in business?

The resource-based view (RBV) is a strategic management framework that emphasizes the importance of a firm's internal capabilities and resources in establishing a competitive advantage. This perspective suggests that a company can achieve superior performance by effectively leveraging its unique resources—such as physical assets, human resources, intellectual property, and organizational processes—rather than solely focusing on external market conditions or industry structures.

By assessing internal capabilities, businesses can identify their strengths and weaknesses, which allows them to align their strategic decisions with their resource endowments. This approach encourages firms to cultivate distinctive competencies that are valuable, rare, difficult to imitate, and non-substitutable, ultimately leading to a sustainable competitive advantage.

While understanding market trends, navigating regulations, and developing relationships with government entities are important aspects of business strategy, they are secondary to the core tenet of the resource-based view, which centers on leveraging internal resources for strategic success.