What are the four criteria for a resource to provide sustained competitive advantage?

What are the four criteria for a resource to provide sustained competitive advantage?

• A. Cost, quality, accessibility, intelligence
• B. Value, rarity, inimitability, non-substitutability
• C. Innovation, adaptability, collaboration, sustainability
• D. Efficiency, complexity, stability, market reach

Answer: (B)

The four criteria for a resource to provide sustained competitive advantage are value, rarity, inimitability, and non-substitutability. Value refers to the ability of a resource to enable a company to exploit opportunities or defend against threats in the market. If a resource is valuable, it contributes to the workings of the firm and enhances its performance and competitive position. Rarity indicates that the resource is not widely possessed by competitors. If a resource is common, it cannot be a source of competitive advantage. Rarity enhances the resource's potential to contribute to unique positioning in the market. Inimitability is the extent to which competitors can replicate the resource. If a resource is difficult or costly to imitate, it provides a more sustainable competitive advantage because it cannot be easily acquired or duplicated by others in the industry. Non-substitutability means that there are no alternative resources or capabilities that can serve the same purpose as the resource in question. If a resource cannot be replaced or substituted effectively by other resources, it strengthens the competitive advantage significantly. The other options include factors that may contribute to business success but do not specifically address the sustained competitive advantage framework. They lack the strategic emphasis on how resources can create a long-term edge over competitors.

The four criteria for a resource to provide sustained competitive advantage are value, rarity, inimitability, and non-substitutability.

Value refers to the ability of a resource to enable a company to exploit opportunities or defend against threats in the market. If a resource is valuable, it contributes to the workings of the firm and enhances its performance and competitive position.

Rarity indicates that the resource is not widely possessed by competitors. If a resource is common, it cannot be a source of competitive advantage. Rarity enhances the resource's potential to contribute to unique positioning in the market.

Inimitability is the extent to which competitors can replicate the resource. If a resource is difficult or costly to imitate, it provides a more sustainable competitive advantage because it cannot be easily acquired or duplicated by others in the industry.

Non-substitutability means that there are no alternative resources or capabilities that can serve the same purpose as the resource in question. If a resource cannot be replaced or substituted effectively by other resources, it strengthens the competitive advantage significantly.

The other options include factors that may contribute to business success but do not specifically address the sustained competitive advantage framework. They lack the strategic emphasis on how resources can create a long-term edge over competitors.