Resource-based view - BT Sport
Context - question from the LSE
The resource-based view (RBV) offers an alternative perspective for business strategy, with a focus on resources and markets. Considering an analytical versus a trial-and-error approach, describe how the RBV might influence business strategy in your context.
My thoughts - answer for the LSE
I worked on the launch of BT Sport UHD. This was a product market; competitor Sky had monetised HD and were expected to launch UHD.
Based on Wernerfelt, consider HD as market 1 and UHD football market 2. Resource 1 (HD) and 2 (UHD) are defined as the assets required. Sky had decades of experience and BT had recently entered. Sky was superior in resource 1, in a stronger position to enter market 2.
BT took a product view and had an intuition that launching in the product market first would deliver revenue. This strategy was based on first mover advantage without appreciating that Sky had a resource position barrier. Our rationale was guided by instinct, experience, and a desire to move quickly. I used structured reasoning; the cost side of the business case was tens of millions in GBP. The revenue side was weak (low UHD TV sales & low HD monetisation).
We also demonstrated trial and error, launching and learning whether UHD could be monetised. The problem was not novel so did not necessitate trial-and-error. Data was available for analytical reasoning. A RBV would have helped us to see that we were overly focused on the product market.