Abstract

This article examines the role of both resource- and activity-based views of a firm in creating a sustainable competitive advantage. The research design is a case study of a consistently high-performing firm in the motor service industry in Kenya. To collect data, in-depth, semi-structured, face-to-face audio-taped interviews with senior managers including the chairman and CEO were employed. This study’s key finding is that tangible resources should possess the characteristics of rarity, valuability, inimitability and unsubstitutability which create sustainable competitive advantage and include state-of-the-art modern showrooms, service workshops, financial resources, spare parts warehouses and human resources. This research contributes to the development of a new theory that integrates the resource- and activity -based view of management, it provides a new research methodology and has implications for policy makers and business in the motor industry. The activity-based view framework is integrated with the resource-based view to explain the actual value creation process by means of tangible resources.

Key words: Resource- and activity-based views, competitive advantage, activity drivers, Kenya.