Date of Award

Spring 2014

Document Type

Dissertation

Degree Name

Doctor of Philosophy (PhD)

Program/Concentration

Business Administration-Strategic Management

Committee Director

Anil Nair

Committee Member

Lance Frazier

Committee Member

Edward Markowski

Abstract

Despite a growing body of research on dynamic capabilities, their contribution to competitive advantage and firm performance, as well as their origins remain unclear. This three-essay dissertation integrates the literatures on dynamic capabilities, environmental jolts, and imprinting theory to examine the following research questions:

1) What is the relationship between dynamic capabilities and firm performance?

2) How do dynamic capabilities influence firm performance during environmental jolts? and

3) What is the role of industry conditions in the development of dynamic capabilities and the dynamic capabilities-performance relationship?

While several scholars have suggested that dynamic capabilities should lead to superior firm performance, others put forth a more skeptical perspective. Thus, the exact nature of the relationship between dynamic capabilities and firm performance, and the contingencies that affect it remain a topic of heated theoretical debates and contradictory findings. Essay I addresses these issues by performing a meta-analysis of empirical studies on dynamic capabilities and firm performance published over the past two decades. Results provide support for an overall positive contribution of dynamic capabilities to performance, with evidence for a stronger relationship between the two constructs in emerging markets. Surprisingly, results suggest that dynamic capabilities contribute more to performance in moderately dynamic environments.

Essay 2 examines whether and how dynamic capabilities contribute to organizational performance amid environmental jolts. Using a sample of firms operating in Israel during the 2008 global financial crisis, I found that dynamic managerial capability and dynamic knowledge-management capability were positively related to performance, while dynamic relationship management capability was not related to performance. Further, I found that interactions between pairs of these capabilities produce negative influences on performance, suggesting that these capabilities are substitutable. Thus, this essay contributes to theory and practice by examining the influence of dynamic capabilities on organizational performance during extremely unfavorable macro-environmental conditions.

Essay 3 uses imprinting theory to argue that firms develop dynamic capabilities as an evolutionary means to successfully compete in their task environments. My analysis using a sample of multinational enterprises (MNEs) found that global industry dynamism had a positive effect on asset management capability. However, results also revealed that asset management capability had a negative impact on financial performance during the 2008 economic crisis, though this effect was positive for MNEs operating in munificent global industries. This study contributes to the dynamic capabilities literature by suggesting that dynamic capabilities may be an outcome of operating in dynamic task environments, rather than driving performance of firms in dynamic task environments. In addition, the findings suggest that some dynamic capabilities may have negative performance implications during times of crisis, and that the availability of critical resources in the environment is complementary to dynamic capability deployment.

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DOI

10.25777/evd1-2917

ISBN

9781303881862

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