PARADOX AND THEORIZING WITHIN THE RESOURCE-BASED VIEW

1. PARADOX AND THEORIZING WITHIN THERESOURCE-BASED VIEW AUGUSTINE A. LADO, NANCY G. BOYD, PETER WRIGHT, MARK KROLL. Disiapkan oleh : Anna Maria Dewi Astuti

2. PARADOX: A CONCEPTUAL BACKGROUND • 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).

3. Extant Conceptualizations of Paradox The term paradox has been conceptualized in different 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

4. Extant Conceptualizations of Paradox 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

5. Extant Conceptualizations of Paradox we use paradox in the informal or “ordinary language” sense to understand how actors make sense of apparent contradictions, oppositions, and ambiguities encountered in work contexts.

6. Extant Conceptualizations of Paradox 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 uses of paradox provide an integrative and holistic understanding of RBV phenomena.

7. Paradox in Philosophy of Science As noted above, the criticism that RBV logic 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”

8. Paradox in Philosophy of Science • 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”

9. Paradox in Philosophy of Science • 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

10. Paradox in Philosophy of Science • 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.

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

12. Logical Conundrums Within the RBV If a resource is unobservable, it cannot be easily imitated and, thus, forms the basis of sustained competitive advantage (Barney, 1991; Reed & DeFillippi, 1990). Yet if a resource is unobservable, it cannot be accurately measured and empirically verified (Godfrey & Hill, 1995); thus, ascertaining its ability to generate sustainable competitive advantage is rendered moot.

13. Logical Conundrums Within the RBV 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 that the RBV is in danger of slipping into an “infinite regress” (Collis, 1994). By this they mean that RBV logic could lead to an endless and futile search for the ultimate stock of resources and capabilities that generate sustained competitive advantage.

14. Logical Conundrums Within the RBV Building on Lakatos’s (1978) ideas, we arrive at a different understanding of the role of these conundrums in advancing RBV scholarship.

15. Logical Conundrums Within the RBV 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.

16. Logical Conundrums Within the RBV 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.

17. Logical Conundrums Within the RBV 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

18. Logical Conundrums Within the RBV 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

19. Ordinary-Language Paradoxes Within the RBV In order to advance understanding, in this section we apply an alternative theory-building 120 Academy of Management Review January strategy that encompasses paradox to three types of ordinary-language paradoxes within the RBV—causal ambiguity, imitation/innovation, and “rules for riches.” These paradoxes illustrate “the potential to enliven [the RBV] if researchers search for and work with inconsistencies, contradictions, and tensions” in the theory

20. Ordinary-Language Paradoxes Within the RBV Causal ambiguity paradox. Causal ambiguity represents a mixed blessing for RBV scholarship. On the one hand, the relative difficulty of deciphering causal relationships between firm resources and capabilities and outcomes is claimed as a significant barrier to imitation of a firm’s competitive advantage

21. Ordinary-Language Paradoxes Within the RBV 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 of competitive advantage (Porter, 1980; Rumelt, 1984, 1987)

22. Ordinary-Language Paradoxes Within the RBV Rules for riches paradox. Critics of the RBV have argued that the theory offers little practical guidance on how managers should build and sustain strategic advantage

23. Rhetorical Paradoxes in the RBV In the following subsections we discuss (1) conflicts among RBV schools of thought and (2) the performance paradox to illustrate how scholars might foster such conversation and promote reflexivity in theorizing

24. Rhetorical Paradoxes in the RBV 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.

25. Rhetorical Paradoxes in the RBV Schulze (1994) distinguishes between two perspectives within the RBV. In one perspective scholars assume a state of equilibrium and focus on how firms gain and sustain competitive advantage using their unique, valuable, and hard-to-copy resources (Barney, 1991; Wernerfelt, 1984). Proponents of the other perspective assume a dynamic process and focus on how asset stocks are accumulated, mobilized, and developed over time to generate a sustainable competitive advantage (Dierickx & Cool, 1989; Teece et al., 1997)

26. Rhetorical Paradoxes in the RBV 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.

27. Rhetorical Paradoxes in the RBV The paradoxical perspective also enables us to explore the tension between knowledge about organizational performance and the power structures that legitimate and “normalize” such knowledge. As Bradbury and Lichenstein note, “The power of those in control produces the knowledge about how to act, and gaining that knowledge about ‘acting normal’ reproduces the power structure”

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