DOI: 10.5176/2251-1970_IE14.05
Authors: George Tovstiga
Abstract: This paper presents the theoretical and conceptual background to empirical research which is currently in progress. It explores the three constituent activities of dynamic capabilities (Teece, 2007, 2009; Teece and Pisano, 1994; Teece, Pisano and Shuen, 1997), consisting of sensing, seizing and reconfiguring; and their relationships to two strategic performance measures, technical and evolutionary fitness as defined by Helfat et al. (2000, 2003, 2007 and 2009). Moreover, this paper explores the role that market dynamics play as the firm seeks to establish evolutionary fitness. For this effect, the paper draws on the definitions of market dynamics (‘moderately dynamic’ and ‘high velocity’) proposed by Eisenhardt and Martin (2000). The specific focus of this study is on entrepreneurial high-technology start-ups. This paper derives a conceptual framework that in a subsequent study forms the basis for an empirical study. On a primary level, we would expect to see some degree of correlation between the three shaping factors, which conceptually contribute to the path dependence exhibited by the firm’s evolving learning trajectory, which we argue is expressed by its technical fitness at any point along that trajectory. On a secondary level, we would expect to find moderating influences of market dynamics on the technical fitness of the firm, and ultimately on the firm’s evolutionary fitness. The conceptual framework developed in this paper lays the groundwork for a subsequent empirical study that is to explore the nature of the moderating effect of market dynamics on both of these factors with the help of structural equation modelling.)
Keywords: dynamic capabilities, market dynamics, technical and evolutionary fitness, strategic performance
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