Toward Greater Integration of the Resource-Based View and Strategic Groups Research: An Illustration Using Random Coefficients Modeling

Abstract

The resource-based view (RBV) of the firm focuses on how firm-level assets and capabilities influence firm performance. Scholars have noted the need for studies grounded in the RBV to account for the role of the strategic group level, but uncertainty remains about how to do so. Random coefficients modeling (RCM) provide an appropriate technique to integrate these two levels of analysis, but its use has been limited in strategic management research to date. I review research integrating firm and strategic group levels and provide a roadmap for future research seeking to integrate these two levels’ influences on firm performance, and use RCM to illustrate the effects of firm resources on performance under three depictions of the strategic group level culled from strategic management research. Findings suggest that interpretations about the efficacy of resources’ influence on performance vary considerably across methodological specification. Next, I use RCM to illustrate how strategic management researchers can further integrate the firm and group levels by demonstrating how variables at the group level of analysis may interact with firm-level characteristics. I conclude with suggestions for future research using RCM to integrate the strategic group into multilevel studies predicting firm performance.