Dynamic capabilities facilitating innovative strategies in SMEs
by Odd Jarl Borch, Einar Lier Madsen
International Journal of Technoentrepreneurship (IJTE), Vol. 1, No. 1, 2007

Abstract: In this study we present dynamic capabilities that facilitate innovative strategies (proactive-creativity strategy and growth-risk orientation) in Small- and Medium-sized Enterprises (SMEs). Corporate entrepreneurship is seen as the integration of opportunity-seeking and advantage-seeking actions providing new, valuable and unique business concepts. We build upon the Resource-Based View (RBV) of the firm and in particular elaborate on the accumulation of dynamic capabilities contributing to innovation and growth-oriented strategies. Based on the literature and an explorative study of 235 small- and medium-sized firms, we develop four categories of dynamic capabilities that are critical for the SMEs entrepreneurial position: internal and external reconfiguration and integration capabilities, resource acquisition capability, learning network capabilities and strategic path aligning capabilities. Most of the relations are medium to highly statistical significant for dynamic capabilities relationships with innovative strategies. Thus, the results indicated support for all the hypotheses, except of the relation between path aligning capabilities and the proactive-creativity strategy.

Online publication date: Thu, 02-Aug-2007

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