Conceptualising the Resource-Based View and the Theory of Firm Heterogeneity: A systematic theoretical review and call for future research in strategic management

Abstract

This paper examines the Resource-Based View (RBV) and the Theory of Firm Heterogeneity to clarify their theoretical boundaries and enhance their explanatory power. It addresses key limitations of RBV, including endogeneity, tautological reasoning, and limited attention to contextual influences, and examines how digital technologies and artificial intelligence (AI) reshape strategic resources and firm heterogeneity. The study employs a systematic review of the strategic management literature. It synthesises the core assumptions of RBV with insights from firm heterogeneity, evolutionary theory, and capability-based perspectives to assess how internal resources, contextual factors, and technological capabilities shape competitive advantage. The review indicates that RBV and the Theory of Firm Heterogeneity provide complementary explanations of persistent performance differences among firms. Competitive advantage depends not only on heterogeneous resources but also on firms' ability to adapt, integrate, and deploy these resources in response to changing environmental and institutional conditions. Digital transformation and AI further amplify firm heterogeneity by creating differences in technological capabilities and innovation capacity. The paper advances the strategic management literature by integrating RBV with the Theory of Firm Heterogeneity, offering a more comprehensive explanation of sustained competitive advantage. It demonstrates how digital technologies and AI reshape strategic resources and identifies future research opportunities in contextual influences, capability development, and technology-driven competitive advantage.

Keywords: {'name': 'Resource-Based View, Firm Heterogeneity, Competitive Advantage, Artificial Intelligence, Dynamic Capabilities, Strategic Management'}

Authors & affiliations

Nelly Musau
Kenyatta University

Ruth Muli
Kenyatta University

Grace Ndethi
Kenyatta University

Mugambi Zachary
Kenyatta University

Patrick Oboge
Kenyatta University

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