Publications

Journal Article

The "resource-based" view of strategy has identified which resources may lead to sustainable competitive advantages and how those resources may either be acquired or developed internally. This paper studies a complementary issue, viz. how resources should be deployed in order to fully realize their rent potential.

Three deployment strategies are compared: captive use, where the firm uses the resource to enhance the competitive position of its own products; resource sharing, where the firm shares the resource with one or more competitors, for example through licensing agreements; and independent selling, where the firm incorporates the resource in an add-on or an up-grade which is sold separately to consumers.

The authors show that a captive use strategy is often dominated by resource sharing or independent selling. Thus, a narrowly focused strategy of pursuing competitive advantage in product markets will frequently fail to capture the full rent potential of strategic resources.