Abstract
As environments become more competitive and change, firms need to look for new ways of competing by implementing changes and innovations aiming at improving or even building new capabilities. Through multiple case studies, we examine the relationship between routines, capabilities and innovation seeking to identify the changes and innovations that have occurred along the trajectory of two wine producing firms in the Serra Gaucha of Rio Grande do Sul, Brazil. The results indicate that both companies submitted changes/innovations in routines and capabilities, however, the different strategies and decisions made led to totally different outcomes in terms of size, growth and market-share.
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