Dynamic mechanism and evolutionary simulation of dynamic capabilities formation of heritage craft enterprises in ethnic villages

THE AIMS OF THE PAPER The existence of dynamic capabilities is key for newly created organizations. However, the development of these capabilities is less researched, especially in the case of start-ups. The primary aim of the study is to explore the characteristics of the development of dynamic capabilities through the case study of a domestic start-up, to illustrate the relationship between organizational and individual capabilities, while providing insights into the interaction between individual capabilities that can lead to the development of dynamic organizational capabilities. METHODOLOGY The primary data collection took place at a domestic start-up. The chosen methodology is the case study, in which three data sources were used. The in-depth interview served as the primary data source, personal or online interviews for at least 45 minutes were conducted with all members of the organization. The in-depth interviews were supplemented by document analysis to gather information from other sources. At the end of the study, the results were validated in a management workshop. MOST IMPORTANT RESULTS During the development of dynamic capabilities four types of interactions between individual capabilities could be identified: complementation, merging and extending similarities, searching and selecting alternatives and acceptance. Each type of interaction provides a solution in different situations, but all of them ultimately contribute to the development of dynamic capabilities. RECOMMENDATIONS Development of dynamic organizational capabilities (hence flexibility) is at least partly rooted in individuals and the interactions between them. It is therefore worthwhile for organizations to emphasize the acquisition of employees with good dynamic managerial capabilities and their involvement in interactions.

Creating dynamic capabilities through business partnerships: the role of resources and capabilities and implications for performance

We conceptualize the dynamic capabilities of multinational enterprises (MNEs) as learning and adaptation capabilities that address the pressure of global integration and local responsiveness. Complementing the extant literature on dynamic capabilities, which is focused on the supply side, our study draws attention to the demand-side influences, especially in terms of global demand heterogeneity. We propose that global demand heterogeneity provides pressures and opportunities for MNEs to learn and adapt and, thus, positively relates to the development of MNE dynamic capabilities. However, external sources per se may be insufficient. Firm-specific advantages, particularly human capital (at the managerial and employee levels), facilitate the internalization of external knowledge and pressure into the development of dynamic capabilities. An empirical study of Chinese multinational service firms strongly supports these arguments.

We surprisingly know little about the process through which dynamic capabilities are generated and developed within organizations. When organizations cope with changes, they need to challenge the very essence and reflect upon the core attributes that make their employees respond to the question of ‘who are we as an organization?’, i.e. organizational identity. In this study we investigate the interplay between organizational identity and the development of dynamic capabilities. Our two qualitative case studies of Italian companies show that the search for coherence between the new routines introduced from outside (i.e. consultants) and organizational identity engenders the development of dynamic capabilities. In the first case, the introduction of new routines triggered the definition of a new organizational identity coherent with the underlying practices, and turned into the development of replication dynamic capabilities. In the second case, an enduring identity inspired the redefinition of the routines and contributed to the development of adaptation dynamic capabilities. The paper discusses contributions to the literatures about dynamic capabilities and organizational identity, as well as practical implications.

While researchers have conceptualized both dynamic and substantive capabilities in a variety of ways, there are still no established measures for either dynamic or substantive capabilities. Although learning has been referred to as a specific type of process underlying the evolution and development of dynamic capabilities, the deep connection between dynamic capabilities and organizational process research has not yet been adequately explored. There is a need for conceptualization and operationalization of these different aspects of the learning process. In this paper, we address these gaps in the literature by drawing upon concepts from the organizational learning, marketing and strategic management fields to understand better and define dynamic and substantive capabilities concepts. First, we define dynamic and substantive capabilities and form a theoretical foundation for their conceptualization. We then develop and test specific item measures for each construct. Our findings support our conceptualization and measurement of both these important aspects of organizational performance.

By investigating drivers of dynamic learning in service alliance firms, this empirical study demonstrates the locus of dynamic knowledge articulation (DKA) and dynamic capabilities (DCs) development. This study uses a sample of 363 service alliance firms to test the distinctive role of drivers of dynamic learning in DKA and DC development. The results show that manager integration powers, external linkages, codification of experience, and ambiguity have positive effects on DKA. Moreover, DKA has a strong positive influence on DC development. This study contributes to the literature by focusing on DKA and DC development from the perspective of processes, structure, and DCs of service alliance firms.

By investigating drivers of dynamic learning in service alliance firms, this empirical study demonstrates the locus of dynamic knowledge articulation (DKA) and dynamic capabilities (DCs) development. This study uses a sample of 363 service alliance firms to test the distinctive role of drivers of dynamic learning in DKA and DC development. The results show that manager integration powers, external linkages, codification of experience, and ambiguity have positive effects on DKA. Moreover, DKA has a strong positive influence on DC development. This study contributes to the literature by focusing on DKA and DC development from the perspective of processes, structure, and DCs of service alliance firms.

Purpose– The purpose of this paper is to examine the development process of dynamic capabilities.Design/methodology/approach– The paper adopts a qualitative, longitudinal participant-observation research design. A single case study firm was observed over a ten-year period of active researcher engagement allowing for the collection of rich data on the development and deployment of dynamic capabilities as they evolved.Findings– Dynamic capabilities can be identified as sensing, seizing and transforming. They are capable of intentional development by managers through strategic decision making and deliberative learning, within a path-dependent evolution.Research limitations/implications– A longitudinal single case study allowed for a close look at the development of dynamic capabilities, exploring the context and conditions that facilitated change and tracing the evolution of the organization’s processes. However, this study remains subject to the limits of a single case approach. Future cross-sectional research would be able to test the conceptual model and allow for generalization of the findings to other populations of firms.Practical implications– The dynamic capability concept has been criticized for being of little practical use to managers. This research shows the process of intentional dynamic capability development, offering insights to practicing managers.Originality/value– This research adds to the relatively scant base of empirical work on dynamic capabilities and offers a conceptual model of dynamic capability development. The paper contributes to the neglected area of dynamic capabilities in SME’s, showing that the dynamic capability concept is relevant to this sector. The paper provides insight for practitioners by showing that intentional dynamic capability development is achievable.

Leaders play a vital role in the development of dynamic capabilities. However, the effects of leadership styles on firms’ dynamic capabilities have not been fully explored, with relatively few studies examining the relationship between leadership and dynamic capabilities. This research examined the influence of transformational and transactional leadership styles on dynamic capabilities. Using data from 279 Kenyan firms. Data analysis was done using hierarchical linear regression model. The finding shows that transformational and transactional leadership styles influence the development of organizational dynamic capabilities. While the transformational leadership style leads to the development of sensing, seizing, and configuration capabilities, transactional leaders do not affect the development of sensing dynamic capabilities. However, they have significant effects on seizing and configuration capabilities development. This study develops knowledge that enables leaders, scholars and practitioners to understand how to use different leadership styles to pursue or develop different dynamic capabilities.

Dynamic capabilities are crucial for China’s private manufacturing enterprises to adapt to environmental changes and maintain their level of competitiveness. However, no thorough conclusions have been drawn as to how to cultivate dynamic capabilities, adapt to the increasingly complicated environment, and maintain competitive edges for China’s private manufacturing enterprises that lack management experience and adequate operational resources. Basing on the literature review about the function-based theories” that cover the definition, elements, and dimensions of dynamic capabilities and the formation-based theories” that include the organizational learning and leadership impact during the development of dynamic capabilities, this study introduces the study framework of the dynamic capability building mechanism in Japan’s manufacturing enterprises, followed by an exploration and interpretation of the building mechanism of dynamic capabilities in China’s private manufacturing enterprises, which was done via interviews with the staff of Geely Automobile and industrial insiders from 2012 to 2018.The findings suggest that the dynamic capability building paths inChina’s private manufacturing enterprises are mostly unplanned and responsive. Builders of dynamic capabilities are limited to senior managers with diverse functional backgrounds. External support from fully functional industrial-academic alliances also help to guarantee the smooth operation of basic organizational functions, whereas inadequate experience, capital and technology support, frequently environmental changes increase the uncertainties of organizational plans, which leads to an unplanned and responsive dynamic capability development path. The limited time for sensing, seizing and transferring, as well as the high employee dismissal rate narrow the builders of dynamic capabilities down to the loyal senior managers with diverse functional backgrounds. External support from fully functional industrial-academic alliances also helps to train the basic organizational capabilities of the middle-level and grass-roots staff, thus supporting the operation of basic organizational functions. To conclude, the main contribution of this study can be reflected in: Firstly, the consideration of factors such as organizational learning and leadership, and the systematic interpretation of the building mechanism of dynamic capabilities from such aspects as the building path, the personnel assigned to accomplish such task, and the organizational features, have further enriched the research on the formation-based theories” in accordance with dynamic capabilities; Secondly, the comparative study on the dynamic capability building mechanisms adopted by enterprises in China and Japan, and the introduction of the subsequent conclusions into the context of developing private manufacturing enterprises in China, both efforts can be considered as not only significant in terms of providing actual and practical guidelines, but also beneficial for deepening the understanding of the organizational characteristics of China’s private manufacturing enterprises to help to establish corporate governance theories with oriental characteristics.

Learning and innovation are important ways for enterprises to develop dynamic capabilities, and dynamic capabilities are a key factor for enterprise to acquire and maintain competitive advantage in dynamic environment. It studies the relationships among organizational learning, knowledge innovation and dynamic capability. The sample of this study includes 271 enterprises in South China. The result indicated that knowledge innovation has a positive direct impact on dynamic capability, but organizational learning impacts dynamic capability indirectly by knowledge innovation. That is to say, if we want to strengthen the dynamic capability and competition advantage of enterprise from organizational learning process, we need the pilot process of knowledge innovation. The main research achievements will be beneficial to Chinese enterprise to promote knowledge innovation by organizational learning, and improve the dynamic capabilities.

In recent years, the dynamic capabilities view has attracted attention in the management literature, and theoretical papers note many research challenges. Currently, one of the most significant issues is the role of the marketing function in the development of dynamic capabilities, and some recent discussions have even introduced the new term ‘dynamic marketing capabilities’. The main area of interest is how to achieve a well‐integrated framework to serve as the starting point for empirical papers. Although the most recent research proposes a wide range of processes as possible dynamic marketing capabilities, it is difficult to find consensus among these proposals. To resolve this difficulty, this paper seeks to define the dynamic marketing capabilities construct based on accepted components in the generic dynamic capabilities view. More specifically, it defines the role of dynamic marketing capabilities through absorptive capacity and knowledge management. By identifying these components and relating them in an integrative model, the authors propose to explain how dynamic marketing capabilities work and precisely which marketing processes promote both components.

Sensing, seizing, and reconfiguring dynamic capabilities in innovative firms: Why does strategic leadership make a difference?

A crucial requirement for firms to remain competitive is to consistently and simultaneously engage in exploratory and exploitative activities. The academic literature has broadly accepted that the development of dynamic capabilities (ie firms' abilities to create, reconfigure and improve resources and capabilities to fit their changing environments) are vital to meeting this competitive requirement. Research has predominately addressed these dynamic capabilities from a management perspective. Little attention has been paid to the influence of the board of directors on these firm capabilities even though boards hold the fiduciary responsibility for the corporation and its long-term viability. Even less has been written on how boards ought to organise themselves and develop their dynamic board capabilities to support and govern corporate renewal and performance effectively. This paper aims to start addressing this gap by using two related aims. First, a process framework for board behaviours is proposed that ensures, and supports, a systematic way of building and developing corporate-level dynamic capabilities. Then, evidence is presented and reviewed from a survey of two board member communities which supports the idea that board capabilities are essential for a firm's successful renewal and economic performance, and need to be improved in practice. This framework is closely aligned with well-established components identified by the management literature but differs in having the board as the unit of analysis. A crucial question and action agenda is proposed for boards eager to acquire and develop their dynamic capabilities.

The roles of cross-cultural adjustment and social capital formation in the dynamic capabilities development of multiunit organizations