Resource based theory

  • The resource based theory of HRM draws attention to the strategic value of the workforce and to the issues of workplace learning.
  • Thus, it appears to embrace a soft view of HRM.
  • Penrose who conceptualized the firm as a collection of productive resources.
  • Quoting Boxall Penrose distinguishes between physical and human resources and draw attention to the issues of learning including knowledge and experience of the management team.
  • According to Armstrong resource based theory which recognizes that the strategic capability of a firm depends on its resource capability, specifically the human resources.
  • The human or people are highly utilized as a resource.
  • Hamel and Prahalad expose that competitive advantage could be achieved by the firms, through developing human resources by way of learning organization and learning and practicing, before their competitors in a most healthiest manner.
  • Heery and Noon note that competitive advantage means the situation that an organization is implementing a strategy that has not been adopted by its current or potential competitors.
  • Competitive advantage is temporary while the sustained competitive advantage is permanent.
  • According to Purcell if any organization could develop extraordinary, non-imitable strategies, values and policies and practices that organization is able to achieve sustained competitive advantage which emanates the view of resources based approach.
  • Therefore sustained competitive advantage is that if any strategy in such way is always targeted at the virtue of internal resources particularly the human resource and applied such strategy or strategies through an effort of benchmarking.
  • The underlying principle of this theory is that resources are the fundamental forces in HRM and particularly the human resources and managers are accentuated to understand the immerging trends of knowledge, learning and learning organizations.
  • Resource based theory specifies the postulation that caliber and human talents have to be developed and utilized for achieving both organizational and personnel objectives a very success.

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