Measuring Sustained Competitive Advantage From Resource-based View: Survey of Chinese Clothing Industry

Dongmei Cao, Nigel Berkeley, Donald Finlay

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Abstract

The resource-based view of the firm (RBV) argues that valuable, rare, inimitable, and non-substitutable resources are the source of a firm's sustained competitive advantage (SCA); this contention has been tested in an increasing number of studies. However, the extant empirical literature emphasizes the significance of resources and capabilities (R & Cs) played and few studies focus on SCA, the other end of the RBV logic. Therefore, this study aims to address this deficiency by focusing on the measurement of SCA. Further, SCA is traditionally measured by financial performance in the empirical studies, which is not only inconsistent with the theory but also proves to be practically difficult in access to the data. However, this paper argues that process performance is more appropriate to measure SCA and this theoretical idea is examined with the survey data collected in 2011/2012 using 209 valid responses from participants in the Chinese clothing companies. Structural equation modeling (SEM) was adopted to test hypothesized relationships between the endogenous construct of process performance and three exogenous constructs measuring R&Cs. The results suggest that process performance is an appropriate and effective method measuring SCA in terms of good construct validity and of consistency with the RBV expectations
Original languageEnglish
Article number1
Pages (from-to)89-104
Number of pages16
JournalJournal of Sustainable Development
Volume7
Issue number2
DOIs
Publication statusPublished - 11 Mar 2014

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clothing
industry
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performance
construct validity
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modeling

Bibliographical note

This work is licensed under a Creative Commons Attribution 3.0 License.

Keywords

  • performance measurement
  • resource-based view
  • sustained competitive advantage
  • structural
  • equation modeling
  • Chinese clothing industry

Cite this

Measuring Sustained Competitive Advantage From Resource-based View : Survey of Chinese Clothing Industry. / Cao, Dongmei; Berkeley, Nigel; Finlay, Donald.

In: Journal of Sustainable Development, Vol. 7, No. 2, 1, 11.03.2014, p. 89-104.

Research output: Contribution to journalArticle

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