The resource based view (RBV) competitive advantage of firms in the context of industry 4 0

The Resource-Based View (RBV) Competitive Advantage of Firms
in The Context of Industry 4.0
Manh Dinh Phan
Matsui Yoshiki
Department of Business Administration, Yokohama National University
Abstract
Resource-based view strategies have attracted the attention of many academicians, however, under the
new context of Industrial Revolution 4.0, the factors, namely the resources and capacities of firms, should be
audited in order that the updated characteristics will be clarified in this new context. The qualitative method
with the emphasis on analyzing the current available online sources is the key data of this paper. The findings
show that there have been many changes in the way the functions in the value chain of the company operate,
including marketing, human resource management, supply chain management and finance management. The
changes needed for the Industry 4.0 have been summarized into two most important key success factors in the
IR 4.0. They are the information technology capacity and new relevant skills for talent. Other specific strategies
to upgrade and leverage resources and capacities have been suggested. The paper, however, has limitations
due to time pressure and data collection method that need more deeply quantitative and qualitative researches
to triangulate outcomes while many drawbacks of IR 4.0 should also be identified and addressed.
Keywords: Resource-based view, strategy, Industry 4.0
1. Introduction

1.1. Strategic Management In The World Of Business
Strategic management has long been the traditional activities in many areas, especially in business fields
throughout the World, of which the Asian references of Japan, South Korea, Taiwan and later China seem to
be very interesting cases. Normally, as firms from the earlier players of more advanced economies, strategic
management is sometimes considered not very necessary for them to pay attention to; however, with the
rigorous competition from the new players in the markets, especially from emerging economies, the process
of strategic management has received the notification from these firms. For the companies from late-comer
economies, especially the startups and SMEs, the strategic management is even more vital to stay alive and
catch up with the big players in the markets. Accordingly, the process of development of the companies from
late-comer economies has seen the role of the strategic management activity when they must catch up with
the early birds from advanced economies of the US and EU with the market assertion and technological

advancements by the intensive strategies.
1.2. Strategic Management In The Industry 4.0 And The Role Of Internal Resources And Capacities
The Industry 4.0 will bring a great number of changes in terms of structure and methods of operation and
doing business of firms. For instance, under the development of Internet and platforms, the firms that is small
but strong in terms of Internet-based technology can compete without the possession of the abundant of
human resources or the location advantage as the traditional firms. Booking.com and Skyscanner.com are the

704


examples for this case. Thus, the strategies of new firms need to be oriented to this fashion while those from
the traditional companies are also required to redirect their business operations and strategies to this trend to
take the advantage of current and future markets. However, to have the competitive capacity, companies must
accumulate the internal resources, especially the ones relevant to technological and digital economy, to
develop in these more competitive markets. From this trend, this paper will try to clarify factors related to
internal capacity, or resource-based view of the firms, which can help companies emerge and develop in the
context of IR 4.0.
2. Literature Review

2.1. Resource Based View And Framework For Analysis
The process of strategy management has been prevalent with the two viewpoints of Resource-based view
and Market-based view. While Market-based view school is popular with the analysis of external
environments to create the competitive advantage for the firms, the resource-based view school focuses on
employing and leveraging the internal possessions to stay competitive in the market. The key authors of MBV
school can be mentioned as Michael Porter, Andrews, Ghemawat while the representatives from RBV can be
attributable to Grant and Barley and then Hamel and Prahalad in their book ‘Competing for the Future’ (1996).
According to RBV school, firms hold a bundle of resources, which can be combined, thus differentiating them
from others and helping these firms gain competitive advantage over the competitors in the market.
To analyze and update the application of RBV thoughts into the present trend in business analysis of
Industry 4.0, the framework for the traditional RBV school will be analyzed as the foundation for the finding

stage of this paper. The resources, capacities and competencies are the key terminologies need clarified as the
foundation for the analysis of Resource-based view strategies of the companies. All factors relevant to
competitive advantage and sustainable competitive advantage of firms will be based on their potential to
create the internal resources and capacities of firms.
Firstly, according to RBV school, resources are a firm’s assets that formulate the basic conditions for the
development of firms. They compose tangible assets, such as its factory, equipment, finances, and location,
human assets, namely number of employees, their relevant skills, and motivation, and intangible assets such
as its technology (patents and copyrights), culture, and reputation.
Capacities are defined as the capacity of firm to exploit its resources. They can be business processes and
methods that coordinate the interactions among these resources to transform them into products/outputs. A
capacity is dependent on a certain function. Therefore, there are marketing capacities, manufacturing
capacities, and resource management capacities and the like.
A competency is a cross-functional integration and coordination of capacities. A core competency can be
created via the accumulation of competencies that can be traced back through the widespread of corporation
and is considered as the factor that can help companies outperform over other companies in the market. Thus,
the company must find the way to maintain the competitive advantage in the market to avoid the risks of
becoming inefficient in the markets, or the situation of the products and technologies becoming obsolete that
can turn the strengths into the weaknesses. When core competencies are outstanding in comparison with the
current players, they are called distinctive competencies.
2.2. Competitive Advantage And Sustainable Competitive Advantage
Competitive advantage based on resource-based view has attracted the attention of many academicians.
For instance, Lippman and Rumelt’s (1982) defined that a sustained competitive advantage is an advantage
that continues to stay stable after efforts of others to duplicate the advantage have ceased. Followingly, Barney

705


(1991) generalizes sustained competitive advantage as a non-duplicatable advantage. According to Barney
(1991), a resource must fulfill ‘VRIN’ criteria to provide competitive advantage and achieve sustainable
performance.

Valuable (V): A resource becomes valuable if it can create strategic value for the company. Specifically,
this means that it can assist the firms with taking advantage of the market opportunities or avoiding the
negative effects from the threats. If it does not complement any value for the company, then there is no value
and motivation to own these resources.
Rare (R): The resource is rare when it must be hard to be identified by the current and potential rivals of
the firm and thus, resources will be able to become precious or unique to provide competitive advantages for
firms holding them. Accordingly, resources which are owned by many firms in the market cannot offer the
competitive advantage since they cannot lead to the formulation of unique and effective business strategies
when compared to other players in the market.
Imperfect Imitability (I): This is to clarify that making a copy or imitation of the resources will not be
feasible. The barriers can be very various such as the difficulties in accessing the resources, ambiguous
relationship between capacity and competitive advantage or the sophistication of the resources. Resources are
considered as sustained competitive advantage only when other firms that do not possess them are not able
to get access to them.
Non-substitutability (N): This characteristic can be achieved when the resources cannot be replaced by
another resource. This means that the competitors cannot gain the same outcome by substituting this resource
with the alternative ones.
In general, it is generally easy to catch up with and imitate another company’s core competencies or
capabilities if they originate from explicit knowledge, or in another word, knowledge that can be easily
communicated. This is the type of knowledge that competitive intelligence activities can quickly be
approached and leaked. Tacit knowledge, in contrast, is knowledge that is difficult to be communicated since
it is deeply imprinted in employee experience or in an organization’s culture. Tacit knowledge is more
valuable and more likely to lead to a sustained competitive advantage than the explicit knowledge because it
is much more difficult for competitors to imitate.
2.3. How can we analyze the resources and capacities?
From the above analysis, as can be seen that the resources and capacities can be analyzed and dug out via
analysis of functions of value chain of the companies including the marketing, finance, human resources,
operations and the like. Therefore, resource-based view analysis is very relevant to analysis of these functions
and strategies related to internal resources are also dependent on strategies of these functions.
2.4. Introduction To Industry 4.0

Industrial revolution 4.0 has emerged as the key terminology in many industries. They are supposed to
have a great impact on many areas and will be able to bring both the challenges and opportunities to business
as well as people illustrated by Professor Klaus Schwab, Founder and Executive Chairman, in the World
Economic Forum (2016). According to Professor Schwab (2016), for the supply side, many areas will witness
the development of innovations and advanced technologies that will lead to the new ways of satisfying the
present customer demands. The new way of organizing the value chains can come from agile and innovative
systems with new competitors when firms can get access to global Internet-based platforms via the whole
functions of business such as R&D, marketing, and so on. On the demand side, the transparency, consumer
participation, and new trend of consumer behavior also create the new thoughts of designing, marketing as
well as delivering products to customers. Thus IR 4.0 will be expected have a great influence on business
operation and enterprises.

706


2.5. The Gap On The Literature
Although RBV school still plays an important role in business analysis in terms of academic and real
business practices and IR 4.0 is also one of the most reminded terminologies when it come to the analysis of
business, there is a limitation of researches that link these two ideas together. Specifically, there is a lack of
papers updating the characteristics of the resources and capacities (from RBV school) in the context of IR 4.0.
What are they? Why should we have them? and how can we achieve them? These are the questions that are
raised and are in an attempt of the paper to answer.
3. Methodology

The paper will employ the qualitative study method with the focus on analyzing the present literature and
study cases on RBV and Industry 4.0. The research described in this paper has largely been carried out via a
desk-based study utilizing various types of literature as primary data sources, ranging from scientific papers,
journals, articles, magazines, newspapers, business reports from companies, consultants’ reports, Social media
to YouTube videos. Throughout the development of this paper, the current state of scientific publications is
regularly reviewed to identify any work being undertaken in a similar focus area. Specifically, this paper aims

at analyzing the present application of internal analysis of firms` resources and capacities to compete in the
business environment in the context of Industry 4.0. Many questions on how to take advantage and leverage
the present RBV resources and capacities in order that firms, especially the SMEs and startups from emerging
economies, can survive and develop in the context of Industry 4.0 are raised. Additionally, other questions on
how to build and develop new resources and capacities in order that these firms can outperform in the markets
in the future context of competition are mentioned. The paper will then give the practical and, to some extent,
theoretical implications in the niche of Resource based view and Industry 4.0.
4. Results And Findings

4.1. What are the latest foundation technologies in the industry 4.0?
The Industry 4.0 have the critical impacts on many industries from service sectors to manufacturing one
with the four specific foundations as described by Capgemini Consulting in an annual report (2014). These
foundations comprise mobile, cloud computing, advanced analytics and machine-to-machine communication.
Mobile Foundation: According to the report, mobile technologies include all wireless communication
platforms and systems that can help mobile gadgets connected to the Wi-Fi or Internet systems and
technologies. In the age of digitization and mobility, mobile gadgets will become the platforms for many
business transactions.
Cloud Computing: As the report described, cloud computing will help business activity accessible by
stakeholders when there is the data available everywhere and the easy access to the Internet. A great amount
of data and information will be stored and analyzed and applied based on this technology.
Advanced Analytics: This technology will operate based on the analysis of the data and information
accumulated via the computer systems. As the businessmen comment possessing data mean possessing golds.
Machine-to-Machine Communication: This is the achievement of Internet of Things technology.
Accordingly, all machine can communicate with each other via the internet-based and automatic systems. This
technology has the great application potentials in the fields of logistics and manufacturing.
4.2. Specific Strategies For The Functions (Resources And Capacities) Of The Company In The Industry 4.0

707

The Industrial Revolution 4.0 with the new technologies and advancements have brought many changes
throughout all functions of value chain of the companies. In general, most of the industries from the digital
based ones like online shopping websites and services in cases of hotel or airline booking to the highly raw
material based and manufacturing industries like crude oil or coal see the impacts from Industrial Revolution
4.0 albeit with the different extent.
4.3. Impacts of IR 4.0 on Marketing Strategies
As Philip Kotler (2017) mentions in his book of Marketing 4.0, marketing function is considered among the
areas strongly impacted by Industry 4.0. Marketing managers of the firms thus need to understand that there
is a shift of market trend in marketing from vertical to horizontal, from exclusive to inclusive and from
individual to social. Especially social media will leverage the connection and communication between people
and companies to create and innovate via coordination and cooperation. In a traditional way, marketing
functions always follow the activity of segmentation, dividing the market into homogeneous groups with
reference to geography, demography, psychography and behavior. In the digital age, customers are linked to
each other in the forms of society and community. Thus, communities become the new business segments and
the companies need the permission to these segments if they want to involve in them. And the companies with
relevant brands must interact with these communities as friends in a harmonious style not just the one-way
advertising campaigns as usual.
For the way of doing business, even for the firms operating under the Business-to-Business (B2B) or
Business-to-Consumer (B2C) forms, customization capacity is an indispensable asset of this Industrial
Revolution that will bring together the B2B and B2C perspectives. Firms are required to be closer to their
customers and even more reactive in identifying and translating their needs, through deeper customer’s
interaction and participation at the value chain level - in designing and the accelerating processes of products.
In this way, the latest technologies are making the transformation of the buyer-seller relationship, both under
the forms of the B2B and the B2C, weighing the firm’s readiness to quickly respond to the customer desires.
In general, under the context of Industry 4.0:
“Marketing 4.0 is a marketing approach that combines online and offline interaction between companies
and customers. In the digital economy, digital interaction alone is not sufficient. In fact, in an increasingly
online world, offline touch represents a strong differentiation. Marketing 4.0 also blends style with substance.
While it is imperative for brands to be more flexible and adaptive due to rapid technological trends, their
authentic characters are more important than ever.” — Kotler describes his approach.

As can be seen that, the traditional characteristics of marketing of offline and differentiation are not
obsolete, instead they need to be leveraged in parallel with the accumulation and development of new
characteristics and capacities of rapid adaptation to the customization and online and digital presentation of
the firms in the market to meet the requirements of new age.
4.4. Impacts of IR 4.0 on Human Resource Strategies
In the new context of IR 4.0, human resource management is not only required in terms of the new skills
and abilities of talent but also in forms of other aspects of workforce management including recruitment,
training and the using these talents.
Accessing and Recruiting the Potential Talent: Under the co context of digital age of social media, the
companies get access to the potential candidates via means of media like Social media profiles, videos
uploaded and the like to triangulate with the hard papers like CV sent to the recruiters. Artificial Intelligence
is on the way to renovate how resumes are approached, or on the way of searching the same number of resume
pools. With neuro-linguistic programming technology that is used to make predictive analytics, recruiters can
get insight into the analysis of the success history of an individual candidate in a certain job position and then

708


evaluate the sources of available candidates to recognize the most appropriate people with the suitable skills
and experience. With video-based interviewing, the records of appearance, facial expressions, reactions to the
questions and so on could be checked and evaluated to confirm the personal creativity, teamwork, knowledge,
and intelligence of that talent.
The Assistance of Virtual Reality: Onboarding of human resource management activity will be enhanced
in terms of the effectiveness and consistency with the assistance of Virtual Reality. Employees could join the
office tour via their mobile gadgets individually; they could say hello to their coworkers, participating in the
meeting or conference hosted by leaders via this mobile gadget. The time for reviewing PowerPoint
presentations or following speakers will not be the problems for the employees.
Replacing Some Tasks by Implemented by Workforce: With the help of the robotics and machine-tomachine learning, many repetitive activities by the human can be conducted by the robotics or machine. These
activities may include chasing the account receivable or inventories or making invoices. This goal can be
achieved with the development of Robotic Process Automation when this new technology can learn how to

implement the same repetitive jobs of the human without mistakes but in a more productive way. Besides, the
programmed software can also conduct the activities of answering the phone calls or email messages with the
speed and an accuracy level like that of the real human resource.
Personalization of Training System: With the development of Artificial Intelligence, many training and
learning activities of each employee will be programmed and adapted to the suitable speed, productivity and
work schedule of that person in order that he/she can organize his/her study/work schedule personally and
effectively. (This cannot be achieved with the traditional training and learning system because the trainees
and learners must follow the common courses or programs designed for all people with fixed schedules and
progresses). Coursera.com or Ted Talk on YouTube are good examples of facilitating the customized services
for employees.
Measurement of HR Performance via Intelligent Machines: The Internet-based and advanced
technologies can transform people progress, assisting supervisors to evaluate the contributions from the
workforce in terms of individual job or teamwork with the appropriate accuracy and the data variety. They
can also enable supervisors to follow the performance of employees with a more transparent and impactful
manner because measurement activity can be more closely interconnected in time to the certain outcome being
assessed objectively by machines.
4.5. Impacts of IR 4.0 on Finance Strategies
According to a report by Ernst & Young (EY) Consulting firm (2017) the context of IR 4.0, the finance
activity is also impacted and thus needs the adaptation to create new capacities and processes in order that
this function can be well prepared for this new age. Internet-based achievements, such as analytics, cloud and
robotic process advancements are on the way to enable the finance and accounting function to contribute much
more value to the business operation in a faster way than the current capacity of firms can perform. This can
be seen under the achievements of increasing in real time, at a huge reduction of cost, with higher degrees of
automatic coordination and lower probability of risk.
Generally, specific technologies have the certain roles in the accounting and financing function. Artificial
Intelligence can help managers exploit large structured and unstructured data sets. It is possible to master the
patterns of financial activity and has the ability of learning and adapting to new accounting or tax rules.
Artificial Intelligence is also likely to generate detailed discoveries into the financial numbers while blockchain
and cryptocurrency technology is in its initial lifecycle and therefore it is also likely to threaten much of today’s
common fashion of how we operate our business. These advancements may influence the scale of financerelevant activities, as well as assisting a shift to its position in the business and the value it offers. Analytics

based on a huge amount of data can facilitate the financial function by offering the tools to get insight into the

709


value of business operation more easily and quickly than the current way. This also helps the organizations
forecast the outcome of operation to have a better understanding of key decisions in terms of financial impact.
At the same time, cloud technology can help firms engage in a connected, flexible and dynamic financial
network, instead of an old-fashioned, fragmented and fixed system. That can help managers trace back to the
financial status very quickly and effectively. However, the risks from these systems also emerge, ranging from
data security and compliance in various regulatory systems.
4.6. Impacts of IR 4.0 on Supply Chain Management Strategies
Because the requirements for highly-customized products and services are seeing the upward trends in the
market, the operations and logistics must be modified to meet this changing condition. However, the
sophistication of this system has caused many difficulties when it cannot be implemented in a normal plans
and practices. Operations and logistics in the Industry 4.0 is relevant to the similar situation of as Smart
Services and Smart Products which can conduct roles which ordinarily are implemented by people. “Smart
Logistics” is a logistics network, which can promote the flexibility, the modification to the market fluctuations
and will bring the company to the outstanding solutions to approaching the customer demands. This will
create the environment to enhance the quality of customer service, the customization of the production process
and reduce the prices of input and output storage and production activity. Since the “Smart Logistics” will
transform in accordance with the real technology drivers, it relies on time and thus it is indispensable to
achieve the state of the art of the technology. According to Barretoab et al. (2017), the IR 4.0 has great impacts
on such Logistics and Operation activities as Resource Planning, Warehouse Management Systems,
Transportation Management Systems, Intelligent Transportation Systems and Information Security.
The Resource Planning: The resource planning management processes, with the implementation of Cyberphysical systems will improve the productivity, flexibility and agility to the fluctuations that might occur in
the supply chains. The proper involvements and engagements between the main factors like people, materials
and equipment which will be likely to create the potentials for customization of resources/processes.
Warehouse Management Systems: The warehouses, plants and factories are always the important
keystones throughout the process of goods flowing from the manufacturing to consuming stages. However,

in the context of strategic management 4.0, the role of this function needs to be even upgraded as the key pool
of competitive advantage for the firms. The achievement of IR 4.0 in warehousing activity is the Warehouse
Management Systems which will help shift the warehousing procedures into the new level that’s can meet the
future demands of operations and logistics in the context of Industrial Revolution 4.0.
Transportation Management Systems: A Transportation Management System is among the steps in
Supply Chain Management. A Transportation Management System can facilitate coordination and
collaboration between an order management system and distribution center or a warehouse to bring the
products from the first step of ordering and manufacturing to the final step of consumption. As management
system has developed in to a concrete form, they can assist companies to control and manage ever-higher costs
of freight; involve in other operations and logistics technologies including Warehouse Management Systems
and Global Trade Management Systems. Besides, they can also help companies process electronic interactions
with buyers, trade partners, and carriers. As their scale of offerings has widened to integrate different
capabilities, Transportation Management System has been selected by many companies of variety of sizes and
in a wide range of industries.
Intelligent Transportation Systems: Intelligent Transportation System is an innovative way that can help
integrate different procedures of transportation systems together with the examples of transportation
management, control, infrastructure, operations and control methods. Intelligent Transportation System
applies technological achievements comprising computing hardware, positioning system, sensor
technologies, telecommunications, data processing, virtual operation and planning techniques. The Intelligent

710


Transportation Systems are vital for achieving higher degree of safety and reliability, faster travel speeds, more
efficient traffic flow a. This system will provide suggestions for collaboration and an appropriate platform for
transport activity.
5. How can firms (especially smes and startups) employ, accumulate and leverage the appropriate resources
and capacities in the context of industry 4.0?

Key Factors To Be Successful In The Industry 4.0

Form the analysis of strategies and requirements of each function throughout the value chain of company
in the context of IR 4.0, to stay competitive advantage and sustainable competitive advantage in this age, the
company needs many assets, but the two most important things are the information and communication
technology capacity and the talent resources relevant to running this technology.
Information Technology Capacity
Information technology is present at a great numbers of computer relevant techniques comprising the
wireless technologies and audio-visual systems. It concentrates on transferring information and data
throughout a variety of electronic devices. This technology has the great impacts on the operation and
existence of organizations. For a startup or an SME, Information technology has been considered very essential
to stay competitive when this system can help them respond quickly to the constant changes in the market.
Taking advantage of information technology enables the exploitation of information resources and leads to
cost reduction and the maximizing client compliance. In the context of this manufacturing age, a great number
of gadgets can get access to Internet-based networks has helped information technology become a key factor
of manufacturing systems when the agile and highly customized products are accelerated by the systems of
digital and virtual production, modeling, simulation, and presentation tools. Information technology has seen
the popular applications in many areas such as education, tourism, manufacturing, social science
implementations, telecommunications, healthcare and so on.
Skill Capacity of Talent
In the context of intensive global competition of today world, the capability of adaptation to changing
business requirements will determine sustainability and competitive advantage of companies. The
advancements driven by the Industry 4.0 in new digital technologies has been extensively changing dynamics
of most industries. Automation of business processes as well as emergence of innovative business models
therefore require new digital skills for workforce. Creating future human resources comprise not only
attracting and developing new employees, but also developing new skills for current people through training
systems as well as reorganizing job processes to help minimize the skill mismatches between work
requirements and employees. Organizations would require a successful modern human resource 4.0 strategy
to deal with the drawbacks of Industry 4.0 transformation. New advancements including Internet-of-Things,
Big Data, and Artificial Intelligence will automate a great number of the human resource processes, leading to
efficient and leaner human resource teams. Therefore, organization structure as well as leadership style
transformations would be in need for better modern human resource 4.0 practices that would help human

resource divisions to play a more strategic role in the overall organization growth.
The new requirements of outstanding skills will remarkably increase, via the Internet of Things and the
level of sophistication and specialization of workforce. The workforce competencies will see the dramatic
changes with the constant application of the Industry 4.0 paradigm. The increasing needs for computational
and analytical skills will transform the common profiles of the workforce in industry. Because of increasing

711


job requirements knowledge is becoming more and more vital. Technical skills are necessary to shift from
operational to more strategic orientations. Increasing process complexity requires a wider and deeper process
comprehension while increasing virtual work requires employees to be able to use smart media, e.g. smart
glasses. Simultaneously, growth of digitized processes will increase a higher need for employees with coding
capacities. Virtual tasks on servers or platforms demand employees to be aware of cyber security.
5.1. General Strategies For Firms From Late-Comer Economies
In the context of intensive competition with the foreign firms with the powerful resources (in the domestic
and international marketplace), the domestic enterprises from emerging economies must confront with the
advantages and disadvantages need clarified to stay competitive in the market.
The Disadvantages of Firms from Emerging Economies
In the competitive environment with the global competitors, the companies from emerging economies
must bear such difficulties as the distance from the leading markets (usually in the advanced economies). The
leading consumers can help the enterprises better predict the trend of the markets. The second drawback is
that the firms are very far from the top technological markets because these technological sources are usually
located in top firms or the universities or the research institutes in the advanced economies. The third
disadvantages are the lack of specialized talents to support the developments of the enterprises.
The Advantages of Firms from Emerging Economies
Although they must face many disadvantages as mentioned above, the businesses from emerging
economies possess the competitive advantage on their own: The first advantage from the latecomer economies
is that they can offer the resources with the lower cost, for instance the pool of the technical talents and the
abundant of the inputs. The next benefit is that the businesses can get access to the data of the markets due to

playing a role as the local firms with the knowledge of the markets. These domestic markets are also pool of
dynamic and young people who can develop the business activities more innovative and creative that these
from developed world.
What Are the Strategies That Businesses from Emerging Economies Can Adopt to Stay Competitive in The
Markets?
However, under the achievements of new Internet-based technologies and other technologies, companies
from emerging economies can reduce the negative aspects of these disadvantages and can also leverage the
positive ones of these opportunities and advantages due to the online interactions and approaching and
observing the advanced markets from a far distance. However, the deliberate strategies need applied to exploit
this chance.
The Creativity-Improving Strategies: One of the strategies that these firms can adopt is that these
businesses can react as the agent of creativity and innovation to have new business ideas and products. How
and where can they formulate the resources for new business ideas? The answer is that they can observe the
business ideas and knowledge from the research institutes, universities or the other companies. These
companies can integrate the new technologies and ideas into their business operations and then use the
fraction of their business profits to invest into their internal R&D activity.
Adoption of Communication Technology in Business Management Activity: The next strategy is that the
companies can apply the Internet and cloud computing into the business activity of their enterprises. This can
help small firms can minimize the negative impacts due to the limitation of scale and internal resources. In
reality, the Internet is helping the small businesses achieve the marketing capacities in the global perspective

712


with the very low cost while the finance and accounting management software is helping companies improve
the management capacity and reduce the high cost relevant to the business management activity of the firms.
Besides, the enterprises can create the virtual stores to connect the manufacturers and the final consumers.
Following the Niche Markets: Some companies will follow the specialized or niche markets in the
domestic or internal levels. Accordingly, firms will develop their specialized products and then introduce to
many geographical markets even the foreign markets. They will try their best in the specialized processes or

products to be the best players in the selected niche. More importantly, via engaging in the global market, the
companies can reduce the drawback of small scale having no the advantages of economy of scale and then
they are able to leverage their products to all markets.
Participating into the Business Networks or the Specialized Clusters: To stay competitive in the market,
small enterprises can take part in the business networks and cooperate with the larger companies. These
clusters can accelerate the leakage of technologies and ideas because the small firms can follow the more
innovative and bigger firms by observing the technological applications and via the chance of approaching
the modern technologies and equipment in the cluster. The leakage effect is also, to some extent, positive when
there is the movement of employees from the bigger companies to the smaller ones or startups, or via
technology consultancy and so on.
6. Conclusion And Limitations

In summary, the analysis has discovered some findings showing that there have been many changes in the
way the functions in the value chain of the company, including marketing, human resource management,
supply chain management and finance management. The changes needed for the Industry 4.0 have been
summarized into two most important key success factors in the IR 4.0. They are the information technology
capacity and new relevant skills for talent. Other specific strategies to upgrade and leverage resources and
capacities have been suggested. The paper, however, has limitations due to time pressure and data collection
method that need more deeply quantitative and qualitative researches to triangulate outcomes and many
drawbacks of IR 4.0 should also be identified and addressed.
Reference
Acquaah, Moses. (2003). Corporate Management, Industry Competition and the Sustainability of Firm Abnormal Profitability, Journal of
Management & Governance, Vol. 7, No. 1, 57-85.
Alvarez, S. & Busenitz, L. (2001). The entrepreneurship of resource-based theory. Journal of Management, 6, 755–775.
Amit, Raphael and Schoemaker, Paul, (1993). Strategic assets and organizational rent. Strategic Management Journal, Vol. 14, 33-46.
Barney, J. B. (1986a). Strategic factor markets: Expectations, luck, and the theory of business strategy. Management Science, 32, 1512–1514.
Barney, J. B. (1986b). Organizational culture: Can it be a source of sustained competitive advantage. Academy of Management Review, 11
(July), 656–65.
Barney, J. B. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17, 99–120.
Barney, J. B. (2001a). Resource-based theories of competitive advantage: A ten-year retrospective on the resource-based view. Journal of

Management, 6, 643–650.
Barney, J. B. (2001b). Is the resource-based “view”a useful perspective for strategic management research? Yes. Academy of Management
Review, 26, 1, 41–56.
Barney, J. B. (2002). Gaining and sustaining competitive advantage. 2nd ed. NJ: Prentice-Hall.
Barretoab, L., Amaralac, A., Pereiraa, T. (2017). Industry 4.0 implications in logistics: an overview. Procedia Manufacturing. Vol 13 , 12451252.
Baum, Joel and Korn, Helaine, (1996) “Competitive dynamics of interfirm rivalry”, Academy of Management Journal, Vol. 39, No. 2, 255291.
Bernheim, B. Douglas and Whinston, Michael, (1990). Multimarket Contact and Collusive Behavior”, The RAND Journal of Economics,
Vol. 21, No. 1, 1-26.
Bhaskar, V. (2017). Industry 4.0 and Future of HR. Available: />Last accessed 10th July 2018.
Boeker, Warren, Goodstein, Jerry, Stephan, John and Murmann Johann Peter, (1997) “Competition in Multimarket Environment: The Case
of Market Exit”, Organization Science, Vol. 8, No. 2, 126-142.
Bowman, Cliff, (2001) Value’ in the Resource-Based View of the Firm: A Contribution to the Debate”, Academy of Management Review,
Vol. 26, No. 4, 501-502.

713


Capgemini
Consulting.
(2014).
Capgemini
Consulting
in
an
annual
report.
Available:
Last accessed 10th July
2018.
Castanias, R., & Helfat, C. (1991). Managerial resources and rents. Journal of Management, 17, 1, 155–172.

Castanias, R., & Helfat, C. (2001). The managerial rents model: Theory and empirical analysis. Journal of Management, 6, 661–678.
Chen, Ming-Jer and Miller, Danny, (1994) “Competitive Attack, Retaliation and Performance: An Expectancy-Valence Framework”,
Strategic Management Journal, Vol. 15, No. 2, 85-102.
Chen, Ming-Jer, (1996) “Competitive analysis and inter-firm rivalry: Toward a theoretical integration”, Academy of Management Review,
Vol. 21, No. 1, 100-134.
Chi, Tailan, (1994). Trading in Strategic Resources: Necessary Conditions, Transaction Cost Problems, and Choice of Exchange Structure,
Strategic Management Journal, Vol. 15, No. 4, 271-290.
Cockburn, I., Henderson, R., & Stern, S. (2000). Untangling the origins of competitive advantage. Strategic Management Journal, 21, 1123–
1145.
Coff, R. (1999). When competitive advantage doesn’t lead to performance: The resource-based view and stakeholder bargaining power.
Organization Science, 10 (2), 119–133.
Coff, Russell, (1999). When Competitive Advantage Doesn’t Lead to Performance: The Resource-Based View and Stakeholder Bargaining
Power, Organization Science, Vol. 10, No. 2, 119-133.
Cohen, Wesley and Levinthal, Daniel, (1990). Absorptive Capacity: A New Perspective On Learning And Innovation, Administrative
Science Quarterly, Vol. 35, No. 1, 128-152.
Collis, David (1991) “A Resource-Based Analysis of Global Competition: The Case of the Bearings Industry”, Strategic Management
Journal, Vol. 12, Special Issue, 49-68.
Combs, J., & Ketchen, D. (1999). Explaining interfirm cooperation and performance: Toward a reconciliation of predictions from the
resource-based view and organizational economics. Strategic Management Journal, 20,9, 867–888.
Conner, K. (1991). Historical comparison of resource-based theory and five schools of thought within industrial organization economics:
Do we have a new theory of the firm? Journal of Management, 17, 1, 121–154.
Conner, Kathleen, (1991) “A Historical Comparison of Resource-Based Theory and Five Schools of Thought Within Industrial
Organization Economics: Do We Have a New Theory of the Firm?”, Journal of Management, vol. 17, No. 1, 121-154.
Cool, Karel, Almeida Costa, Luis and Dierickx, Ingemar, (2002) “Constructing Competitive Advantage”, in Pettigrew, Andrew, Thomas,
Howard and Whittington, Richard (Eds), Handbook of Strategy and Management, Sage publications.
Dierickx, Ingemar and Cool, Karel, (1989) “Asset Stock Accumulation and Sustainability of Competitive Advantage”, Management
Science, Vol. 35, No. 12, 1504-1513.
Eisenhardt, K. M., & Martin, J. A. (2000). Dynamic capabilities: What are they? Strategic Management Journal, 21 (10–11), 1105–1121.
Ernst
&

Young.
(2017).
What
role
could
the
finance
function
play
in
a
4.0
world?.
Available:
Last accessed 10th July 2018.
Fiol, M. (2001). Revisiting an identity-based view of sustainable competitive advantage. Journal of Management, 6, 691–699.
Foss, Nicolai and Knudsen, Thorbjørn, (2003) “The Resource-Based Tangle: Towards a Sustainable Explanation of Competitive
Advantage”, Managerial and Decision Economics, Vol. 24, No. 4, 291-307.
Foss, Nicolai, (1998) “The Resource-Based Perspective: An Assessment and Diagnosis of Problems”, Scandinavian Journal of
Management, Vol. 14, No. 3, 133-149.
Foss, Nicolai,(1996) “Research in strategy, economics, and Michael Porter”, Journal of Management Studies, Vol. 33, No. 1, 1-24.
Franklin, S., Lockett, A., & Wright, M. (2001). Academic and surrogate entrepreneurs in university spin-out companies. Journal of
Technology Transfer, 26 (1–2), 127–141
Gimeno, Javier and Woo, Carolyn, (1996) “Hypercompetition in a Multimarket Environment: The Role of Strategic Similarity and
Multimarket Contact in Competitive De-Escalation”, Organization Science, Vol. 7, No. 3, 322-341.
Gimeno, Javier and Woo, Carolyn, (1999) “Multimarket Contact, Economies of Scope, and Firm Performance”, Academy of Management
Journal, Vol. 43, No. 3, 239-259.
Gimeno, Javier, (1999) “Reciprocal Threats in Multimarket Rivalry: Staking out ‘Sphere of Influence’ in the U.S. Airline Industry”, Strategic
Management Journal, Vol. 20, 101-128.
Gnyawali, Devi and Madhavan, Ravindranath, (2001) “Cooperative networks and competitive dynamics: a structural embeddedness

perspective”, Academy of Management Review, Vol. 26, No. 3, 431-445.
Godfrey, P. C., & Hill, C. W. (1995). The problem of unobservables in strategic management research. Strategic Management Journal, 16
(7), 519–533.
Grant, Robert, (1991) “The Resource-Based Theory of Competitive Advantage: Implications for Strategy Formulation”, California
Management Review, Vol. 33, No. 3, 114135.
Harris, Ira and Ruefli, Timothy, (2000) “The Strategy/Structure Debate: An Examination of the Performance Implications”, Journal of
Management Studies, Vol. 34, No. 4, 587603.
Harrison, Hitt, M., Hoskisson, R. E., & Ireland, D. (2001). Resource complementarity in business combinations: Extending the logic to
organizational alliances. Journal of Management, 6, 000–000.
Hawawini, Gabriel, Subramanian, Venkat and Verdin, Paul, (2003) “Is performance driven by industry- or firm-specific factors? A new
look at the evidence”, Strategic Management Journal, Vol. 24, No. 1, pg. 1.
Henderson, Rebecca and Mitchell, Will,(1997) “The Interactions of Organizational and Competitive Influences on Strategy and
Performance”, Strategic Management Journal, Vol. 18, 5-14.
Hitt, M. A., Dacin, M. T., Levitas, E., Arregle, J-L. & Borza, A. (2000). Partner selection in emerging and developed market contexts:
Resource-based and organizational learning perspectives. Academy of Management Journal, 43 (3), 449–467.
Hoskisson, R. E., Eden, L., Lau, C-M. & Wright, M. (2000). Strategies in emerging economies. Academy of Management Journal, 43 (3),
249–267.
Hoskisson, R. E., Hitt, M. A., Wan, W. P., & Yiu, D. (1999). Theory and research in strategic management: Swings of a pendulum. Journal
of Management, 25 (3), 417–456.

714


Hult, G. T., & Ketchen, D. (2001). Does market orientation matter?: A test of the relationship between positional advantage and
performance. Strategic Management Journal 22 (9), 899–906.
Jayachandran, Satish, Gimeno, Javier and Varadarajan, P. Rajan, (1999) “The Theory of Multimarket Competition: A Synthesis and
Implications for Marketing Strategy”, Journal of Marketing, Vol. 63, 49-66.
Jensen, M. (1993). The modern industrial revolution, exit, and the failure of internal control systems. Journal of Finance, 48, 831–880.
Jick, T. (1979). Mixing qualitative and quantitative methods: Triangulation in action. Administrative Science Quarterly, 24, 602–611.
Karnani, Aneel and Wernerfelt, Birger, (1985) “Multiple Point Competition”, Strategic Management Journal, Vol. 6, No. 1, 87-96.

Keasey, K., & Wright, M. (1993). Corporate governance: Issues and concerns. Accounting and Business Research, 23 (91A), 301–313
Knott, Anne Marie, (2003) “The Organizational Routines Factor Market Paradox”, Strategic Management Journal, Vol. 24, No. 10, 929-943.
Korn, Helaine and Baum, Joel, (1999) “Chance, Imitative, and Strategic Antecedents to Multimarket Contact”, Academy of Management
Journal, Vol. 42, No. 2, 171-193.
Kotler, P., Kartajaya, H., & Setiawan, I. (2017). Marketing 4.0: Moving from traditional to digital.
Lado, Augustine, Boyd, Nancy and Hanlon, Susan, (1997) “Competition, Cooperation, and the Search for Economic Rents: a Syncretic
Model”, Academy of Management Review, Vol. 22, No. 1, 110-141.
Levinthal, Daniel and Myatt, Jennifer,(1994) “Co-Evolution of Capabilities and Industry: The Evolution of Mutual Fund Processing”,
Strategic Management Journal, Vol. 15, 45-62.
Lippman S.A. & Rumelt, R.P. (1982). "Uncertain Imitability: An Analysis of Interfirm Differences in Efficiency under Competition," Bell
Journal of Economics, The RAND Corporation, vol. 13(2), pages 418-438, Autumn
Lockett, A., & Thompson, S. (2001). The resource-based view and economics. Journal of Management, 6, 723–754.
Mahoney, J. (2001). A resource-based theory of sustainable rents. Journal of Management, 6, 651–660.
Mahoney, Joseph and Pandian, Rajendran, (1992) “The Resource-Based View Within The Conversation of Strategic Management”,
Strategic Management Journal, Vol. 13, 363-380.
Mathews, John, 2003) “Strategizing by firms in the presence of markets for resources”, Industrial and Corporate Change, Vol. 12, No. 6,
1157-1193.
McGahan, Anita and Porter, Michael, (1997) “How much does industry matter, really?”, Strategic Management Journal, Vol. 18, 15-30.
McGrath, Rita Gunther, Chen, Ming-Jer and MacMillan, Ian, (1998) “Multimarket Maneuvering in Uncertain Spheres of Influence:
Resource Diversion Strategies”, Academy of Management Review, Vol. 23, No. 4, 724-740.
McWilliams, Abagail, Van Fleet, David and Cory, Kenneth, (2002) “Raising Rivals’ Costs Through Political Strategy: An Extension of
Resource-Based Theory”, Journal of Management Studies, Vol. 39, No. 5, 707-723.
Oliver, Christine, (1997) “Sustainable Competitive Advantage: Combining Institutional and Resource-Based Views”, Strategic
Management Journal, Vol. 18, No. 9, 697-713.
Peteraf, Margaret and Barney, Jay, (2003) “Unraveling The Resource-Based Tangle”, Managerial and Decision Economics, Vol. 24, 309323.
Peteraf, Margaret and Bergen, Mark, (2003) “Scanning dynamic competitive landscapes: a market-based and resource-based framework”,
Strategic Management Journal, Vol. 24, 1027-1041.
Peteraf, Margaret, (1993) “The Cornerstones of Competitive Advantage: A Resource-Based View”, Strategic Management Journal, Vol.
14, No. 3, 179-191.
Porter Michael, (2980) Competitive Strategy: Techniques for Analyzing Industries and Competitors, New York, The Free Press.

Porter, Michael, (1981) “the contributions of industrial organization to strategic management”, Academy of Management Review, Vol. 6,
609-620.
Porter, Michael, (1991) “Towards a dynamic theory of strategy”, Strategic Management Journal, Vol. 12, 95-117.
Prahalad, C. K. and Hamel, Gary, (1994) “Strategy as a Field of Study: Why Search for a New Paradigm?”, Strategic Management Journal,
Vol. 15, Special Issue, 5-16.
Priem, Richard and Butler, John, (2001a) “Is the resource-based “view” a useful perspective for strategic management research?”,
Academy of Management Review, Vol. 26, No. 1, 22-40.
Priem, Richard and Butler, John, (2001b) “Tautology in the resource-based view and the implications of externally determined resource
value: further comments”, Academy of Management Review, Vol. 26, No. 1, 57-66.
Reed, Richard and Defillippi, Robert, (1990) “Causal Ambiguity, Barriers to Imitation, and Sustainable Competitive Advantage”, The
Academy of Management Review, Vol. 15, No. 1, 88-102.
Riordan, Michael, (1998) “Anticompetitive Vertical Integration by a Dominant Firm”, The American Economic Review, Vol. 88, No. 5,
1232-1248.
Rumelt, Richard, (1984) “Towards a strategic theory of the firm”, in Lamb, R., (Ed.), Competitive Strategic Management, Prentice-Hall,
Englewood Cliffs (NJ).
Rumelt, Richard, (1998) “How much does industry matter?”, Strategic Management Journal, 1991, Vol. 12, 167-185. Sampler, Jeffrey,
“Redefining Industry Structure for the Information Age”, Strategic Management Journal, Vol. 19, No. 4, 343-355.
Russo, M. V., & Fouts, P. A. (1997). A resource-based perspective on corporate environmental performance and profitability. Academy of
Management Journal, 40 (3), 534–559.
Scandura, T. (1998). Dysfunctional mentoring relationships and outcomes. Journal of Management, 24 (3), 449–467.
Schendel, Dan, (1991) “Introduction to the Winter 1991 Special Issue: Fundamental Research Issues in Strategy and Economics”, Strategic
Management Journal, Vol. 12, 1-3.
Schmalensee, Richard, (1985) “Do Market Differ Much?”, The American Economic Review, Vol. 75, No. 3, 341-351.
Schoemaker, Paul, (1990) “Strategy, complexity, and economic rent”, Management Science, Vol.36, 1178-1192.
Schwab, K. (2017). The Fourth Industrial Revolution. New York, USA: Crown Publishing Group New York.
Short, H., Keasey, K., Wright, M., & Hull, A. (1999). Corporate governance: From accountability to enterprise. Accounting and Business
Research, 29 (4), 337–352.
Spender, J. C., & Grant, R. (1996). Knowledge and the firm: Overview. Strategic Management Journal, 17, 5–10.
Spender, J.-C., (1996) “Making Knowledge the Basis of a Dynamic Theory of the Firm”, Strategic Management Journal, Vol. 17, Special
Issue, 45-62.

Staw, B. (1991). Dressing up like an organization: When psychological theories can explain organizational action. Journal of Management,
17 (4), 805–819.

715


Steier, L., & Greenwood, R. (1995). Venture capitalist relationships in the deal structuring and post-investment stages of new firm creation.
Journal of Management Studies, 32, 337–357.
Teece, David, Pisano, Gary and Shuen, Amy (1997) “Dynamic capabilities and strategic management”, Strategic Management Journal,
Vol. 18, No. 7, 509-533.
Tripsas, Mary, (1997) “Unraveling the Process of Creative Destruction: Complementary Assets and Incumbent Survival in the Typesetter
Industry”, Strategic Management Journal, Vol. 18, 119-142.
Wernerfelt, Birger, (1984) “A Resource-Based View of the Firm”, Strategic Management Journal, Vol. 5, No. 2, 171-180.
Williamson, Oliver, (1991) “Strategizing, economizing, and economic organization”, Strategic Management Journal, Vol. 12, 75-94.
Wright, M., Hoskisson, R., & Busenitz, L. (2001). Firm rebirth buyouts as facilitators of strategic growth and entrepreneurship. Academy
of Management Executive, 15 (1), 111–125.
Wright, M., Hoskisson, R., Busenitz, L., & Dial, J. (2000). Privatization and entrepreneurship: the upside of management buy-outs.
Academy of Management Review, 25 (3), 591–601.
Wright, P., Dunford, B., & Snell, S. (2001). Human resources and the resource-based view of the firm. Journal of Management, 6, 701–721
Zhong, R. Y., Xu, X., Klotz, E., & Newman, S. T. (2017). Intelligent Manufacturing in the Context of Industry 4.0: A Review. Engineering,
3(5), 616-630. DOI: 10.1016/J.ENG.2017.05.015

716