Abstract
The paper examines how a small entrepreneurial firm can achieve successful product innovation and technology change by substituting the traditional drivers for innovation with higher order organizational capabilities. In particular, we introduce the concept of dynamic entrepreneurial capabilities defined as higher order capabilities peculiar to small and medium‐sized enterprises. We used a longitudinal case study to investigate a complex and discontinuous technology innovation undertaken by Vetromed. Our findings clarify the role of dynamic entrepreneurial capabilities in enacting, developing, refining, and deploying three substantive entrepreneurial capabilities: distributed entrepreneurial insight, entrepreneurial heuristics, and entrepreneurial flexibility.
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