Traditional strategy models such as
Michael Porter's five forces model
focus on the company's external competitive environment.
Most of them do not attempt to look inside the company. In contrast, the
resource-based perspective highlights the need for a fit between the
external market context in which a company operates and its internal
In contrast to the Input / Output Model (I/O model), the
resource-based view is grounded in the perspective that a firm's internal
environment, in terms of its resources and capabilities, is more critical to
the determination of strategic action than is the external environment.
for Building a High-growth Business
"Instead of focusing on the accumulation of resources necessary to
the strategy dictated by conditions and constraints in the external
environment (I/O model), the resource-based view suggests that a firm's
unique resources and capabilities provide the basis for a strategy.
chosen should allow the firm to best exploit its
opportunities in the external environment,"
write M.A. Hint, R.D. Ireland, and R.E. Hoskisson in Strategic Management
‒ Competitiveness and Globalization.
The resource based view of strategy emphasizes economic rent