Articles MSI - Hart: A natural resource based view of the firm

9 important questions on Articles MSI - Hart: A natural resource based view of the firm

What does the article of Hart proposes?

A natural-resource-based view of the firm: a theory of competitive advantage based upon the firms rerlationship to the natural environment. It is composed to the three itnerconnected strategies: pollution prevention, product stewardship, and sustainable development.

During the past decade there has been pressure for firms to minimize or eliminate emissions, effluents and waste from their operations. How can this pollution be prevented (pollution prevention), according to Hart?

Pollution abatement (vermindering) can be achieved through 2 primary means:
- Control: emissions and effluents are trapped, stored, treated, and disposed of using pollution-control equipment
- Prevention: emissions and effluents are reduced, changed, or prevented through better housekeeping, material substitution, recycling and process innovations.
> Through pollution prevention, companies can realize significant savings, resulting in a cost advantage relative to competitors.

Pollution prevention focuses on new capability building in production and operations. However, activities at every step of the value chain, have environmental impacts and these will almost certainly need to be internalized in the future. What does product stewardship (beheer) do with this problem? (Hart)

Product stewardship entai;s integrating the 'voice of the environment', that is, external (stakeholder) perspectives into product design and development processes. 
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Reducing emissions is the fundamental aim of pollution prevention., whereas product stewardship guides the selection of raw materials and disciplines product design with the objective of minimizing the environmental impact of product systems. In what does this result? (Hart)

Together, these two strategies help sever (verbreken) the negative links between business and environment in the developed markets in the North (USA, Western Europe, Japan etc.). A sustainable development strategy also dictates that effort be made to sever the negative links between environment and economic activity in the developing countries of the south.

What is the challenge of sustainable development according to Hart?

The challenge is to have significant implications for firms, particularly large multinationals:
-Recognizing the link between material consumption in the north and environmental degradation in the south (most products consumed in the north require raw materials or resources from the south)
-firms must build amrkets in the south while reducing the environmental burden created by this new economic activity
> For a firm, pursuing a sustainable development strategy implies both substantial investment and a long-term commitment to market development. 

Explain why the 3 strategies of the natural-resource-based view appear to be interconnected according to Hart? First, explain interconnectedness.

Interconnectedness means: 1) acquiring a certain resource might depend upon having already developed other resources first, or 2) a given capability depends on the simultaneous presence of other resources acquired due to a unique path through history. Interconnected consists thus of 2 dimensions: path dependence and embeddedness.

To be interconnected, the 3 strategies have to be path depended and/or embedded. Explain if they are embedded? (Hart)

In short, if a firm takes a purely sequential path, it may fail to take advantage of the clear synergies that exist across the strategies. So by being embedded, the stratgies create synergies. 

Hart has argued that a limited view of what constitutes a firm's environment renders (maakt) the RBV inadequate as a basis for identifying important future source of competitive advantage. What did this research do regarding this?

Hart proposed a natural-resource-based view of the interconnected strategies (pollution prevention, product stewardship, sustainable development) and offered propostions concerning their connection to sustained competitive advantage. But there is much work to be done examining the relationships among the 3 startegies and indicators of financial and market performance. 

What is the key message of Hart?

Management theory has neglected natural constraints. "RBV takes the perspective that VRIN is the key to sustainable competitive advantage"
(The RBV combines internal (org. capabilities) and external (environmental circumstances) perspectives to explain competitive advantage.

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