Achieving a firm’s competitive advantage through dynamic capability

2016 ◽  
Vol 11 (3) ◽  
pp. 260-285 ◽  
Author(s):  
Chinho Lin ◽  
Hua-Ling Tsai
Keyword(s):  
Competitive Advantage ◽  
Organizational Performance ◽  
Dynamic Capabilities ◽  
Dynamic Environment ◽  
Quantitative Model ◽  
Organizational Capabilities ◽  
Dynamic Capability ◽  
Top Management ◽  
Content Type ◽  
Firm Model

Purpose – The purpose of this paper is to propose a quantitative model to help managers diagnose what dynamic capabilities a firm needs to address the demands of a rapidly changing environment. Design/methodology/approach – A two-firm model based on the VRIO framework is built using quantitative techniques to assist top management in formulating and implementing strategies regarding when and how to develop a firm’s dynamic capabilities for achieving a competitive advantage. This model is developed by considering both internal and external competences, with the former measured by the features of the organizational capabilities of the focal firm and latter evaluated by comparing the relative utilities of the dynamic capabilities of the two competing firms. Findings – Three resource allocation strategies are introduced to guide a firm to leverage dynamic capability that generates strong organizational performance. The first two strategies are, respectively, synergy oriented, focussing on acquiring various knowledge or experiences of a capability, and uniqueness oriented, emphasizing the depth of knowledge and technology of the capabilities. The third one is a hybrid of the first two strategies. Originality/value – The proposed model is useful to help top management determine how and when to renew, bundle, and leverage resources and capabilities in a dynamic environment. It enables decision makers to detect changes in the competitive environment and take corrective action in a timely and appropriate manner.

The effect of knowledge management capability and dynamic capability on organizational performance

2014 ◽  
Vol 27 (2) ◽  
pp. 158-179 ◽  
Author(s):  
Shu-Mei Tseng ◽  
Pei-Shan Lee
Keyword(s):  
Knowledge Management ◽  
Organizational Performance ◽  
Dynamic Capabilities ◽  
Sampling Method ◽  
Management Practices ◽  
Dynamic Environment ◽  
Dynamic Capability ◽  
Future Research ◽  
Content Type ◽  
Main Research

Purpose – The current conventional strategic management model is incapable of dealing with various questions on organizational management in a dynamically discontinuous environment. Hence, how an enterprise can effectively apply its knowledge management (KM) capability and develop a uniquely dynamic capability in order to provide quick response to a dynamic environment has become an urgent need. The purpose of this paper is to discuss the above-mentioned issues. Design/methodology/approach – In order to gain best exploration on KM capability, dynamic capability, and organizational performance, the questionnaire and statistical analytical techniques were used. Findings – The results indicate that dynamic capability is an important intermediate organizational mechanism through which the benefits of KM capability are converted into performance effects at the corporate level. That is, KM capability enhances the dynamic capability of organizations. While dynamic capability, in turn, increases organizational performance and provides competitive advantages. Research limitations/implications – This research applied a purposive sampling method and obtained a slightly inadequate number of respondents. Therefore, it is suggested that future research should apply a random sampling method to collect more responses and increase the generalizability. Practical implications – This research aims to investigate KM capability, dynamic capability, and organizational performance, as well as establish and verify the patterns of the aforementioned relationships based on how enterprises implement their KM capabilities and dynamic capabilities to enhance organizational performance. Originality/value – There is still little related literature investigating the relationships among KM capability, dynamic capability, and organizational performance. Hence, this study applies questionnaire methods as the main research tools in order to conduct an in-depth investigation into the influence of KM capability and dynamic capability on organizational performance. Furthermore, this research is expected to provide enterprises with valuable suggestions for management practices.

scholarly journals Meningkatkan Produktivitas Industri Kecil Menengah Kota Batam Melalui Kompetensi Inti dan Daya Saing

2018 ◽  
Vol 5 (2) ◽  
pp. 230-247
Author(s):  
Yuddy Giovanna Priscilla
Keyword(s):  
Competitive Advantage ◽  
Organizational Performance ◽  
Dynamic Capabilities ◽  
Core Competencies ◽  
Shared Vision ◽  
Organizational Capabilities ◽  
Company Performance ◽  
Organizational Resources ◽  
Organizational Capability ◽  
The Impact

The purpose of this study is to measure the influence of core competencies consisting of organizational resources (shared vision, cooperation and empowerment) and organizational capabilities (knowledge management capabilities and dynamic capabilities) on the company's performance through competitive advantage in Small and Medium Industries in Batam to be able to face competition business is getting tighter due to the impact of the Asean Economic Community (AEC). The sample was taken from 105 top-level management as owners or managers of 105 Small and Medium Industries companies that have characteristics in accordance with Law No. 3 of 2014 concerning the regulation of small and medium industries using Purposive Sampling method. This study uses a comparative causal approach. The results of this study indicate that organizational resources have no significant effect on competitive advantage, but organizational resources have a significant impact on company performance. While the ability of the organization, by using the mediating role of competitive advantage has a significant effect on the performance of the company, but the ability of the organization does not have a significant direct effect on the company's performance. And for the mediation itself (competitive advantage) has a significant influence on the dependent variable (organizational performance).   Keywords: Core Competence; Competitive Advantage;Organizational Resources; Organizational Capability; Organizational Performance

scholarly journals The interrelatedness of organizational ambidexterity, dynamic capabilities and open innovation: a conceptual model towards a competitive advantage

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Johannes W.F.C. van Lieshout ◽  
Jeroen M. van der Velden ◽  
Robert J. Blomme ◽  
Pascale Peters
Keyword(s):  
Competitive Advantage ◽  
Conceptual Model ◽  
Open Innovation ◽  
Dynamic Capabilities ◽  
Dynamic Environment ◽  
Organizational Ambidexterity ◽  
Organization Studies ◽  
Content Type ◽  
Research Fields ◽  
The Impact

PurposeEstablishing a competitive advantage in today's dynamic environment involves optimizing an organization's exploration and exploitation strategy. This paper aims to explore how an open innovation strategy complements the organization's ambidextrous strategy in attaining a competitive advantage. Organizational ambidexterity and dynamic capability theories are also explored to investigate the impact of open innovation on the organization's ambidextrous strategy and competitive advantage – especially inbound and outbound open innovation.Design/methodology/approachThe authors conducted a systematic literature review using Boolean search techniques, which was focused on the research fields of the sub-areas of general management, strategy, innovation, organization studies, information management, entrepreneurship, international business, marketing, and economics, supplemented by the snowball technique.FindingsOrganizations that combine their ambidextrous strategy with open innovation attributes achieve a competitive advantage through developing their dynamic capabilities by which organizations change their value proposition. This study also shows that an ambidextrous strategy should no longer be viewed as a structural solution implemented by management, but also as a bottom-up intervention. Additionally, the authors found that the organization's dynamic capabilities establish a feedback loop, which changes the organization's ambidextrous strategy to resolve the efficiency–agility paradox.Originality/valuePrevious research has focused on strategic orientation; however, hardly any research has investigated how the interrelatedness of open innovation, organizational ambidexterity and dynamic capabilities support a competitive advantage. The authors present a conceptual model that inspires new research avenues.

The challenges of organizational agility (part 1)

2017 ◽  
Vol 49 (1) ◽  
pp. 6-14 ◽  
Author(s):  
Steven H. Appelbaum ◽  
Rafael Calla ◽  
Dany Desautels ◽  
Lisa Hasan
Keyword(s):  
Competitive Advantage ◽  
Organizational Performance ◽  
High Speed ◽  
Dynamic Capabilities ◽  
Environmental Changes ◽  
Continuous Change ◽  
Organizational Agility ◽  
Content Type ◽  
Operational Activities ◽  
Traditional Structures

Purpose Planned episodic change programs, rigid processes and traditional structures, optimized for efficiency rather than agility, are no longer appropriate in a context where competitive advantage is fueled by high-speed innovation, supported by a more entrepreneurial mindset. The purpose of this two part paper is to offer a review of relevant research to provide an informed case for continuous strategic transformation facilitated by enhanced organizational agility. The concept of agility is explored, defined and a framework for categorizing agility-enhancing capabilities is presented. Specific aspects of this agility framework are examined to better understand how these interrelated competencies contribute to overall corporate performance in this fast-paced world. Design/methodology/approach A range of published empirical and practitioner research articles were reviewed to study the concepts of organizational agility and transformation as critical factors contributing to sustained competitive advantage, organizational performance and survival in the increasingly competitive global context. This literature review explores how organizations are overcoming the challenges imposed by their traditional structures, cultures and leadership models and identifies dynamic competencies to be developed to achieve a greater level of corporate agility. Findings Increased organizational agility increases the ability to respond proactively to unexpected environmental changes. The commitment to continuous transformation and agile strategies implies changes at all levels of the organization from its structure, through its leadership and decision-making dynamics, down to the skills and interpersonal relationships of the individuals implementing the agile mission. Research limitations/implications There is a gap in the literature with respect to agility, namely, that most research focuses on the characteristics of agile organizations, with little attention given to how to develop agile capabilities and embed the commitment to continuous change deep into the corporate DNA, beyond the process level, into the psyche of the people driving the organization. Practical implications Managers should consider agility as an overarching principle guiding strategic and operational activities. Fostering agility-enhancing capabilities will be paramount in ensuring the successful integration of agility as a performance enhancing paradigm. Social implications For small- and medium-sized companies with limited resources, this reality makes staying relevant an uphill battle but also opens windows of opportunity. The challenge of the next century for large organizations will be to rekindle their innovative agile beginnings and for start-ups to continue to foster their dynamic capabilities as they grow. Originality/value The paper provides practical and empirical evidence of the importance of enterprise agility and specific dynamic capabilities on firm performance.

Big data and competitive advantage at Nielsen

2014 ◽  
Vol 52 (3) ◽  
pp. 573-601 ◽  
Author(s):  
Michael E. Prescott
Keyword(s):  
Competitive Advantage ◽  
Business Strategy ◽  
Dynamic Capabilities ◽  
Secondary Data ◽  
Business Environment ◽  
Digital Data ◽  
Dynamic Capability ◽  
Annual Reports ◽  
Content Type

Purpose – The purpose of this paper is to illustrate how an international company, Nielsen Holdings, reacted to changes in their highly competitive industry brought about by advances in technology. This case presents the strategic management decisions that enabled Nielsen to regain its competitive advantage. This case further describes the functioning of the resource-based view (RBV) of strategy, dynamic capabilities framework, and digital data genesis (DDG), in a turbulent business environment. Design/methodology/approach – The case study is based primarily upon secondary data to include annual reports, press releases, company web site, as well as articles. Findings – The case study provides an example of the functioning of a once durable competitive advantage that was eroded due to advances in technology, and the steps the company took to regain that advantage. The paper illustrates the functioning of a capability and a dynamic capability in DDG. Practical implications – This case can be used for the teaching of decision making, business strategy, the RBV of strategy, dynamics capabilities, and DDG. Originality/value – This paper provides an example of the functioning of the capability and dynamic capability of DDG.

The challenges of organizational agility: part 2

2017 ◽  
Vol 49 (2) ◽  
pp. 69-74 ◽  
Author(s):  
Steven H. Appelbaum ◽  
Rafael Calla ◽  
Dany Desautels ◽  
Lisa N. Hasan
Keyword(s):  
Competitive Advantage ◽  
Organizational Performance ◽  
High Speed ◽  
Dynamic Capabilities ◽  
Environmental Changes ◽  
Continuous Change ◽  
Organizational Agility ◽  
Content Type ◽  
Operational Activities ◽  
Traditional Structures

Purpose Planned episodic change programs, rigid processes and traditional structures, optimized for efficiency rather than agility, are no longer appropriate in a context where competitive advantage is fueled by high-speed innovation, supported by a more entrepreneurial mindset. The purpose of this paper is to offer a review of relevant research to provide an informed case for continuous strategic transformation facilitated by enhanced organizational agility. The concept of agility is explored, defined and a framework for categorizing agility-enhancing capabilities is presented. Specific aspects of this agility framework are examined to better understand how these interrelated competencies contribute to overall corporate performance in this fast-paced world. Design/methodology/approach A range of published empirical and practitioner research articles were reviewed to study the concepts of organizational agility and transformation as critical factors contributing to sustained competitive advantage, organizational performance and survival in the increasingly competitive global context. This literature review explores how organizations are overcoming the challenges imposed by their traditional structures, cultures and leadership models and identifies dynamic competencies to be developed to achieve a greater level of corporate agility. Findings Increased organizational agility increases the ability to respond proactively to unexpected environmental changes. The commitment to continuous transformation and agile strategies implies changes at all levels of the organization from its structure, through its leadership and decision-making dynamics, down to the skills and interpersonal relationships of the individuals implementing the agile mission. Research limitations/implications There is a gap in the literature with respect to agility, namely that most research focuses on the characteristics of agile organizations, with little attention given to how to develop agile capabilities and embed the commitment to continuous change deep into the corporate DNA, beyond the process level, into the psyche of the people driving the organization. Practical implications Managers should consider agility as an overarching principle guiding strategic and operational activities. Fostering agility-enhancing capabilities will be paramount in ensuring the successful integration of agility as a performance enhancing paradigm. Social implications For small- and medium-sized companies with limited resources, this reality makes staying relevant an uphill battle but also opens windows of opportunity. The challenge of the next century for large organizations will be to rekindle their innovative agile beginnings and for start-ups to continue to foster their dynamic capabilities as they grow. Originality/value The paper provides practical and empirical evidence of the importance of enterprise agility and specific dynamic capabilities on firm performance.

Mediation effect of dynamic capability in the relationship between knowledge management and strategic leadership on organizational performance accountability

2018 ◽  
Vol 60 (2) ◽  
pp. 517-529 ◽  
Author(s):  
Kamariah Najmi ◽  
Abdul Rahman Kadir ◽  
Muh. Isa Ansari Kadir
Keyword(s):  
Knowledge Management ◽  
Organizational Performance ◽  
Dynamic Capabilities ◽  
Hospital Performance ◽  
Mediating Effect ◽  
Dynamic Capability ◽  
Equation Modeling ◽  
Strategic Leadership ◽  
Content Type ◽  
The Relationship

Purpose This study aims to examine and assess the effect of knowledge management and strategic leadership on performance of hospitals by using variables’ mediating effect of dynamic capability. Design/methodology/approach The population included in this study are all the elements of leadership, i.e. both structural and functional leaders at the four hospitals in Makassar [the central government (Dr Wahidin Sudiro Husodo), Regional General Hospital belonging to the Provincial Government of South Sulawesi (Hospital Labuang Baji and hospitals Hajj) and government hospitals (hospitals belonging Makassar City Government)]. The sample size resulting from the analysis tools included approximately 100 respondents. This research used both structural, i.e. structural equation modeling (SEM), and Sobel tests for assessing the mediation effects. Findings First, dynamic capabilities as a mediation variable in relationship between the knowledge management and performance of hospitals, indicates that higher knowledge management will result in improved hospital performance, if the mediated dynamic capability was also higher. Second, dynamic capabilities as the mediation in the relationship between strategic leadership and hospital performance indicates that a higher strategic leadership will lead to improved hospital performance, if the mediated dynamic capability was also higher. Originality/value The results of previous studies on knowledge management in public sector organizations were not sufficiently clear. Moreover, the study of knowledge management in the health services industry also received less attention from previous researchers. This research attempts to fill the gap further by examining the influence of knowledge management on organizational dynamic capability and organizational performance of hospitals. The presence of the mediating variable dynamic capability also differentiates this study from previous studies.

scholarly journals Identification of dynamic capabilities in open innovation

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Edson Rodrigues de Aro ◽  
Gilberto Perez
Keyword(s):  
Grounded Theory ◽  
Data Collection ◽  
Strategic Management ◽  
Competitive Advantage ◽  
Open Innovation ◽  
Dynamic Capabilities ◽  
Dynamic Capability ◽  
Content Type ◽  
External Knowledge ◽  
Data Collection And Analysis

Purpose This study aims to understand the interaction between capabilities inherent in open innovation and dynamic capabilities (sensing, seizing and transforming) as a source of competitive advantage. Design/methodology/approach Qualitative method and grounded theory were used as guidelines for data collection and analysis. Findings The study identifies a set of capabilities in the practice of open innovation related to dynamic capabilities, which indicates the importance of developing dynamic capability in the strategic management of internal and external knowledge in the company. Research limitations/implications The number of interviewees approached herein do not allow generalizations, but the use of grounded theory through various strategies of data collection in the interviews allowed the triangulation of the data, increasing the credibility, validity and quality of the research. Originality/value This study presents capabilities identified in open innovation and their relationship with dynamic capabilities, identifying the importance of the dynamic capability in the strategic management of internal and external knowledge in the company as a source of competitive advantage.

scholarly journals Understanding collaborative innovation from a dynamic capabilities perspective

2018 ◽  
Vol 30 (6) ◽  
pp. 2396-2416 ◽  
Author(s):  
Philip Alford ◽  
Yanqing Duan
Keyword(s):  
Competitive Advantage ◽  
Dynamic Capabilities ◽  
Dynamic Capability ◽  
Future Research ◽  
Key Factors ◽  
Strong Base ◽  
Content Type ◽  
Collaborative Innovation ◽  
Management Organisation

PurposeThis paper aims to understand the key factors affecting collaborative innovation in a destination management organisation from a dynamic capability perspective.Design/methodology/approachAn in-depth case study was conducted using semi-structured interviews with the CEO and Chairman of the destination management organisation (DMO) and internal DMO documents from 2011 to 2016. Thematic analysis was carried out on the data both deductively, with generic themes identified and informed by theory, and inductively, where detailed subthemes were developed from the data.FindingsThe success of innovation in the context of a DMO depends on having a strong base of microfoundations that underpin the DMO’s capabilities to sense and seize opportunities and reconfigure its assets for competitive advantage. Collaboration with the key players in the sector has been the essential elements of these microfoundations.Research limitations/implicationsThis study has been conducted within a single DMO case study. Future research should test the proposed models in different types of organisations and collaborative contexts.Practical implicationsThe proposed dynamic capability framework helps managers achieve collaborative innovation, leading to competitive advantage through better development of relevant capabilities.Originality/valueThe study represents a first attempt to understand the key factors enabling successful collaborative innovation in the context of DMOs, from a dynamic capability perspective. The unique opportunity of accessing information and witnessing the changes in a DMO over a period of five years enabled the authors to gain in-depth insights and comprehensive understanding as to why and how a UK DMO has been successful in enhancing its business performance through a successful collaborative innovation.

scholarly journals The applicability of Grant’s framework in the dynamic digital age

2015 ◽  
Vol 27 (6) ◽  
pp. 656-678 ◽  
Author(s):  
Mona Rashidirad ◽  
Ebrahim Soltani ◽  
Hamid Salimian ◽  
Yingying Liao
Keyword(s):  
Competitive Advantage ◽  
Design Methodology ◽  
Dynamic Capabilities ◽  
Theoretical Foundation ◽  
Dynamic Environment ◽  
Digital Age ◽  
Internal Factors ◽  
Resource Based View ◽  
Content Type ◽  
Strategic Resources

Purpose – This paper aims to investigate the applicability of Grant’s framework in the current changing and dynamic environment. Design/methodology/approach – In this paper, a critical review of Grant’s paper was conducted to identify the limitations and weaknesses of the framework, which prevent its effective application in the current digital age. Findings – As a result, this paper presented a modified framework and four propositions to consider dynamic capabilities in the new turbulent environment and extend the relationships between a firm’s resources, capabilities, dynamic capabilities, competitive advantage and competitive strategy. Findings tied to this initiative will provide important contributions to research. Originality/value – Rooted in resource-based view (RBV), the proposed framework puts forward a valid theoretical foundation on how to create a competitive advantage from a firm’s internal factors, including strategic resources, capabilities and dynamic capabilities. Furthermore, it contributes to RBV literature by considering dynamic capabilities, as the firms’ most crucial factors in the current dynamic digital market.

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