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Service-dominant orientation, dynamic capabilities and firm performance

Ralf Wilden (University of Newcastle, Sydney, Australia)
Siegfried Gudergan (Newcastle Business School at the University of Newcastle, Callaghan, Australia) (Waikato Management School at the University of Waikato, Hamilton, New Zealand)

Journal of Service Theory and Practice

ISSN: 2055-6225

Article publication date: 10 July 2017

Abstract

Purpose

The purpose of this paper is to investigate the effects of a firm’s service-dominant orientation on marketing and technological capabilities, and its performance. It outlines how a service-dominant orientation offers guidance for the development and deployment of ordinary capabilities, and indirectly affects performance. Additionally, it delineates how dynamic capabilities affect the impact of a service-dominant orientation on ordinary capabilities.

Design/methodology/approach

Partial least squares structural equation modeling drawing on data from 228 firms serves to assess hypotheses relating service-dominant orientation and dynamic capabilities with firm performance.

Findings

The results indicate that marketing and technological capabilities fully mediate the relationship between a firm’s service-dominant orientation and firm performance. Furthermore, the positive marginal effect of a firm’s service-dominant orientation on its marketing capabilities increases with the firm displaying a stronger service-dominant orientation. In addition, the positive effect of service-dominant orientation on marketing capabilities reduces the more the firm deploys dynamic capabilities.

Research limitations/implications

Because of the cross-sectional sample, future studies could adopt longitudinal research designs to explore the impact of a service-dominant orientation on ordinary capabilities and performance, or investigate the applicability of the findings in other contexts.

Practical implications

The findings imply that implementing a service-dominant orientation can be beneficial for firms. However, because the impact of such an orientation weakens the greater a firm’s dynamic capabilities, managers need to be mindful of this trade-off.

Originality/value

The study is the first to establish a link between the dynamic capability view, originating from strategy research, and service-dominant logic, stemming from marketing thinking.

Keywords

Citation

Wilden, R. and Gudergan, S. (2017), "Service-dominant orientation, dynamic capabilities and firm performance", Journal of Service Theory and Practice, Vol. 27 No. 4, pp. 808-832. https://doi.org/10.1108/JSTP-04-2016-0077

Publisher

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Emerald Publishing Limited

Copyright © 2017, Emerald Publishing Limited