Revisiting the cumulative capability model (CCM) among manufacturing firms in developing countries

Abstract

We examine the applicability of the competitive cumulative capability model among firms in developing economies within the context of the manufacturing industry. We specifically investigate whether the pattern in which competitive capabilities are pursued differs among firms in different developing countries, as well as whether these firms pursue their capabilities in a cumulative fashion. Using a global dataset and focussing on firms in three developing countries that are geographically dispersed – Nigeria, India, and Vietnam – we investigate relationships for firms both within and across countries. Although notions of the cumulative capability model were confirmed, the pattern of the progression is different among firms in the three countries studied. The findings suggest that firms in different developing countries exhibit different manufacturing strategies based on their relative location to their performance frontier, their country’s current state of economic development, as well as the extent of western manufacturing influence in each country.