RBV argues that if every firm does the same analysis it would end up with the same conclusions. Barney (1986) then argues that the sustainable competitive advantage has to lie within the firm’s resources and the way they employ them. According to Barney (1991), if firms want to achieve sustainable competitive advantage and consequently above normal profits, the resources they employ should be valuable, rare, inimitable and non-substitutable. But the preliminary condition for a company to acquire those resources at a price, that allows positive economic profits, is the existence of factor market imperfections and heterogeneity (Barney, 1986).

RBV is more applicable to leading firms with resources of high order to shape the strategy; in case of average performing organisations it would be better to formulate the strategy more by taking the industry structure into account.

RBV theory is a political theory in which any organization who has the resources could impact on the other organizations whom they need relevant resources. So in this case we should see 2 limitation as follows:

• Sometimes you have length & Width limitations like as "time" and "Place".
• Sometimes you need to revise the marketing mix in this order to eliminate any limitation.
• Sometime you yourself make any limitation to control the environment even internal or external like as Quality Control (QC) and Quality Assurance (QA)

RBV is a broadly supported model for thinking about how organisations compete which proposes the limits on a firm's activities are the resources it controls (which can be tenuously defined) and the quality of the administrative framework that is used by the firm to co-ordinate their use.  RBV predates and is embedded in much of modern strategic thinking, in particular as it relates to inter-firm competition.  

If there are weaknesses, they must relate to limitations relating to one or other of its precepts, or one or more 'missing' elements.  

One example of limitations in the precepts is our ability to fully understand them.  If we are unable to accurately form a view about the extent of a firm's resources, or to fully understand the nature of its administrative patterns, our ability to use this information to usefully direct strategy has to be constrained.  Yet (for example) Stiglitz and Williamson's separate work on information impactedness would indeed suggest  suggest that our ability to understand these two elements for an organisation is severely constrained.

An example of a 'missing' element is the assumption in RBV that the context within which a firm operates provides good information about opportunities both current and future.  This perhaps can be approximated away by claiming 'good environmental awareness' is yet another resource to include in the firm's inventory - but it is still possible to suggest that context-changing events (such as innovation and regulatory change) are not well reflected in the pure RBV view.

The utility and influence of RBV as a mental-model for considering how organisations fit into the wider landscape, or as a framework for decision making should not be dismissed, but there certainly is a case to be made to argue that RBV is best considered an abstract framework upon which to build, rather than a solution in its own right.

Dear Colleagues

You answers to my question has given me insights in to the limitations of RBV Theory. I was only focusing on  its assumptions (1) that resources must be heterogeneous (2) that resources must be inimitable as the only limitations of RBV

The resource-based view of the firm that gained currency in the mid-1980s considered that the competitive advantage of an organization rests on the application of the strategic resources at its disposal. These days, orthodoxy recognizes the merits of the dynamic, knowledge-based capabilities underpinning the positions organizations occupy in a sector or market. PS: Learning in Strategic Alliances, available at https://www.researchgate.net/publication/241801661_Learning_in_Strategic_Alliances, may be of related interest.

Article Learning in Strategic Alliances

I agree with Lawrie's view that RBV should be employed as a framework to build upon, for example: 1. What were considered valuable, rare, inimitable and non substitutable, may not always remain so. Have these resources been further developed, or have they been eroded over time? 2. Where do these resources stand in the current/ future business scenario? 3. How has the organisation exploited opportunities using these resources? How have the organisation's capabilities to attract, acquire, use and develop such resources changed over time?

These dynamic elements would have to be woven into the RBV.

VRIO can be replicated over time and my not considered as SCA.

How a large organisation view RBV will differ from a small or a start up where they may find unique ways to over come VRIO disadvantage and create there own SCA.

limitations of the Resource-Based View

Like most theories used in business, the resource-based view has its share of criticism. For example, it can be difficult to determine the appropriate level of analysis due to the broad definitions of resources. Furthermore, certain types of resources, such as a company's reputation or knowledge, are subjective. Managers must also consider the fact that heterogeneity doesn't necessarily imply uniqueness.

While it's true that a firm's resources are important, they are not the only factor behind business growth and performance. Regulatory policies, strategic planning and other aspects matter too. Another potential issue is that new technologies and trends are emerging every day and may have a dramatic effect on your key resources.

Researchers also state that valuable resources don't necessarily provide a competitive advantage. The global economy and other external factors may have a greater impact under certain circumstances. For example, even if your software program is valuable, rare and so on, customers may still want a less-advanced product that comes with a lower price tag during economic downturns. Additionally, your competitors may offer a completely different product that yields similar results in terms of efficiency.