paradox and theorizing within the resource-based view

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AUGUSTINE A. LADO, NANCY G. BOYD, PETER WRIGHT, MARK KROLL. Disiapkan oleh : Anna Maria Dewi Astuti

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PARADOX AND THEORIZING WITHIN THE RESOURCE-BASED VIEW. AUGUSTINE A. LADO, NANCY G. BOYD, PETER WRIGHT, MARK KROLL. Disiapkan oleh : Anna Maria Dewi Astuti. PARADOX: A CONCEPTUAL BACKGROUND. - PowerPoint PPT Presentation

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Page 1: PARADOX AND THEORIZING WITHIN THE RESOURCE-BASED VIEW

AUGUSTINE A. LADO, NANCY G. BOYD, PETER WRIGHT, MARK KROLL.

Disiapkan oleh : Anna Maria Dewi Astuti

Page 2: PARADOX AND THEORIZING WITHIN THE RESOURCE-BASED VIEW

Organization and management scholars haveargued that the use of paradox can engenderunderstanding by enabling scholars to address logical contradictions (or conundrums) in a theory and to identify tensions and oppositions in order to develop more encompassing theories

Thus, paradoxes may serve as useful conceptual tools that extend our capabilities beyond the limits imposed by formal

logic (Ford & Backoff, 1988; Starbuck, 1988).

Page 3: PARADOX AND THEORIZING WITHIN THE RESOURCE-BASED VIEW

The term paradox has been conceptualized indifferent ways, including formal/logical,

informal/ ordinary language, and rhetorical. These conceptualizations might reflect the different “language games” that people play when they perceive complex and incongruous phenomena

Page 4: PARADOX AND THEORIZING WITHIN THE RESOURCE-BASED VIEW

we use paradox in three ways: formal/logical, informal/ordinary language, and rhetorical uses.

We use paradox in the logical sense to address epistemological issues surrounding RBV logic, such as problems of unfalsifiability, tautology, and infinite regress

Page 5: PARADOX AND THEORIZING WITHIN THE RESOURCE-BASED VIEW

we use paradox in the informal or“ordinary language” sense to understand

howactors make sense of apparent

contradictions,oppositions, and ambiguities encountered inwork contexts.

Page 6: PARADOX AND THEORIZING WITHIN THE RESOURCE-BASED VIEW

we use paradox in the rhetorical sense to open up new (different) vistas for knowledge and knowing, and with a view to fostering productive inquiry (Cook & Brown, 1999).

Together, these three usesof paradox provide an integrative and holisticunderstanding of RBV phenomena.

Page 7: PARADOX AND THEORIZING WITHIN THE RESOURCE-BASED VIEW

As noted above, the criticism that RBVlogic contains paradoxes that diminish its

explanatory power might be rooted in the traditional view of scientific inquiry, which holds that paradoxes are anathema to scientific inquiry

This view, however, has been vigorously challenged by “natural” and social scientists, by philosophers of science and by those who study the practice of science (e.g.,Harding, 1991; Latour, 1987).

Taken together, their work suggests, alternatively, that “science is based on deliberately create [paradoxical] contradictions”

Page 8: PARADOX AND THEORIZING WITHIN THE RESOURCE-BASED VIEW

Within an alternative view of science, paradox

forces investigators to “think twice” about taken-for-granted assumptions about reality, truth, and knowledge Working with paradox

enables scholars to seek “truth, often with the knowledge that they will not attain it”

Page 9: PARADOX AND THEORIZING WITHIN THE RESOURCE-BASED VIEW

Within this view, knowledge is understood both as a cause and an effect, a state as well as a flow (Snowden, 2002), reflecting how the content of knowledge and the context of knowing are inextricably intertwined (e.g., Cook & Brown, 1999). Understanding knowledge simultaneously as cause and effect challenges the traditional positivist thinking that emphasizes knowledge as an object that can be independently “discovered” through the scientific method and that relegates “subjective” knowledge to art and philosophy (Chalmers, 1999). Instead, a paradoxical view of knowledge suggests that “what is a cause can only be identified as such in the process of effecting ‘something’ that by the same token can only be identified as ‘effect’ in . . . conjunction with ‘something’ that produced it” (Fischer, 2003: 32). Furthermore, the notion of scientific progress is viewed not as a linear movement toward a certain and final truth but as a dialectical process of oppositions, contradictions, and conflicts, the resolution of which gives rise to yet other paradoxes at more complex levels

Page 10: PARADOX AND THEORIZING WITHIN THE RESOURCE-BASED VIEW

Researchers may focus on augmenting the hard core of the research program by increasing its theoretical content, making it capable of anticipating novel phenomena. Contrary to naive falsificationists, Lakatos argues that there is no falsification before the emergence of a better theory, yet a better theory cannot emerge if all theoretical statements have to bear the brunt of falsification. In Lakatos’s system, scientific progress results from ongoing dialectical interplays among multiple and competing theories within an “organic” research program.

Page 11: PARADOX AND THEORIZING WITHIN THE RESOURCE-BASED VIEW

In this section we examine logical conundrums, as well as ordinary language and rhetorical sources of paradox within the RBV

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If a resource is unobservable, itcannot be easily imitated and, thus, forms thebasis of sustained competitive advantage

(Barney,1991; Reed & DeFillippi, 1990). Yet if a resourceis unobservable, it cannot be accuratelymeasured and empirically verified (Godfrey &Hill, 1995); thus, ascertaining its ability to

generatesustainable competitive advantage is renderedmoot.

Page 13: PARADOX AND THEORIZING WITHIN THE RESOURCE-BASED VIEW

Priem and Butler (2001) question the theoretical value of the RBV, especially Barney’s (1991) ideas that a resource must be valuable, rare, and nonsubstitutable in order to generate sustained competitive advantage.

Finally, some researchers have argued thatthe RBV is in danger of slipping into an “infiniteregress” (Collis, 1994). By this they mean thatRBV logic could lead to an endless and futilesearch for the ultimate stock of resources andcapabilities that generate sustained competitiveadvantage.

Page 14: PARADOX AND THEORIZING WITHIN THE RESOURCE-BASED VIEW

Building on Lakatos’s (1978) ideas, we arrive at

a different understanding of the role of theseconundrums in advancing RBV scholarship.

Page 15: PARADOX AND THEORIZING WITHIN THE RESOURCE-BASED VIEW

First, to the extent that falsification is used for assessing knowledge claims, sophisticated rather than naive falsification might be suitable insofar as it is used to appraise the RBV as a system of multiple and interdependent theories. As we discuss later, the RBV has undergone a proliferation of schools of thought, relying on different sets of theoretical assumptions and distinct analytical tools and vocabularies for investigating strategic management phenomena.Since such proliferation reflects healthy competition among the RBV schools, we regard it as a sign of theoretical progress.

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Second, a hard core of the RBV research program appears to have emerged. Scholars workin within the RBV have utilized apparently paradoxical constructs (such as causal ambiguity) and apparent tautologies within the RBV to expand the scope of this research program. Concepts such as tacitness, specificity, and path dependence have become staples within the context of RBV theorizing. Efforts to further develop these core ideas for the purpose of increasing theoretical content might contribute to turning the RBV into a progressive research program.

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Third, Researchers working within the RBV research program have similarly capitalized on the tautological statements by identifying distinct assumptions associated with different schools of RBV thought by specifying temporal and spatial contexts within which different types of resources and capabilities contribute the most to firm performance, and by introducing new terms

Page 18: PARADOX AND THEORIZING WITHIN THE RESOURCE-BASED VIEW

Fourth, the infinite regress conundrum within the RBV might not be such a damning liability in advancing the theoretical system, as those who subscribe to positivist philosophy of science would have us believe

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In order to advance understanding, in this sectionwe apply an alternative theory-building120 Academy of Management Review Januarystrategy that encompasses paradox to threetypes of ordinary-language paradoxes withinthe RBV—causal ambiguity, imitation/innovation,and “rules for riches.” These paradoxesillustrate “the potential to enliven [the RBV] ifresearchers search for and work with

inconsistencies,contradictions, and tensions” in the theory

Page 20: PARADOX AND THEORIZING WITHIN THE RESOURCE-BASED VIEW

Causal ambiguity paradox. Causal ambiguity

represents a mixed blessing for RBV scholarship.

On the one hand, the relative difficulty ofdeciphering causal relationships between firmresources and capabilities and outcomes isclaimed as a significant barrier to imitation of afirm’s competitive advantage

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Paradox of imitation/innovation. A central

premise of strategy researchers is that a firm’s

innovations must be protected from imitation,

since imitation threatens the sustainability ofcompetitive advantage (Porter, 1980; Rumelt,1984, 1987)

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Rules for riches paradox. Critics of the RBV

have argued that the theory offers little practical

guidance on how managers should build andsustain strategic advantage

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In the following subsectionswe discuss (1) conflicts among RBV schoolsof thought and (2) the performance paradox

toillustrate how scholars might foster such

conversationand promote reflexivity in theorizing

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Conflicts among RBV schools of thought.

Over the years, different schools of thought within the RBV have emerged, each having distinct theoretical assumptions and propositions.

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Schulze (1994) distinguishes between twoperspectives within the RBV. In one perspectivescholars assume a state of equilibrium and focuson how firms gain and sustain competitiveadvantage using their unique, valuable, andhard-to-copy resources (Barney, 1991;

Wernerfelt,1984). Proponents of the other perspectiveassume a dynamic process and focus on howasset stocks are accumulated, mobilized, anddeveloped over time to generate a sustainablecompetitive advantage (Dierickx & Cool, 1989;Teece et al., 1997)

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The performance paradox.

A rhetorical perspective also encourages us to constantly question our assumptions about what we know about firm performance. Firm performance or competitive advantage is a “slippery” construct to operationalizeand measure.

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The paradoxical perspective also enables usto explore the tension between knowledge aboutorganizational performance and the powerstructures that legitimate and “normalize” suchknowledge. As Bradbury and Lichenstein note,“The power of those in control produces theknowledge about how to act, and gaining thatknowledge about ‘acting normal’ reproduces thepower structure”

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