A resource is costly to imitate if other organizations that doesn’t have it can’t imitate, buy or substitute it at a reasonable price. Imitation can occur in two ways: by directly imitating (duplicating) the resource or providing the comparable product/service (substituting).
A firm that has valuable, rare and costly to imitate resources can (but not necessarily will) achieve sustained competitive advantage. Barney has identified three reasons why resources can be hard to imitate:
Historical conditions. Resources that were developed due to historical events or over a long period usually are costly to imitate.
Causal ambiguity. Companies can’t identify the particular resources that are the cause of competitive advantage.
Social Complexity. The resources and capabilities that are based on company’s culture or interpersonal relationships.