Search results

Based on the dynamic capability theory, the purpose of this study is to examine the mediating role of the adaptive capability of small- and medium-sized enterprises (SMEs) on the relationship between business ties and firm performance. This study also investigates the moderating role of technological turbulence in those relationships.

Data were collected from 1,265 SME managers in Turkey. Partial least squares analysis, a variance-based structural equation modelling, was applied to examine a mediated moderation model.

The results support the proposed framework illustrating that business ties are positively related to adaptive capability and firm performance. Moreover, adaptive capability mediates the relationship between business ties and firm performance. The results also indicate that the indirect effect of business ties on firm performance through adaptive capability was moderated by technological turbulence.

SMEs in emerging economies need to enhance their business ties and invest in their adaptive capabilities to increase their performances. This relation becomes more strategic under technologically turbulent environments.

By introducing empirical data from the Turkish emerging context, this paper contributes to our understanding of how SMEs’ relational networks contribute to firm performance. From the dynamic capability perspective, it shows how SMEs use their adaptive capabilities to environmental challenges. It also fills an important gap by showing that environmental uncertainties (specifically technological turbulence) moderate the adaptive capability’s mediating impact on the relationship between business ties and firm performance. The results also provide potential future directions for dynamic capabilities research in emerging contexts.

This article focusses on the hybrid strategy, a simultaneous combination of cost leadership and differentiation strategy. The study aims to examine the impact of hybrid strategy on firm performance through its anticipated positive effects on process and product innovation. In addition, we study the moderating role of adaptive capacity in the direct relationships of hybrid strategy with process and product innovation.

Structural equation modelling was used to analyse 1,842 Spanish firms with fewer than 250 employees. We randomly selected small and medium-sized enterprises (SMEs) operating in Spain from the Spanish Central Business Directory (2021) database. The overall sample design was based on stratified sampling.

We found that hybrid strategy is positively related to firm performance and to process and product innovation. Additionally, in firms implementing hybrid strategies, process innovation fostered firm performance. Finally, adaptive capacity strengthened the relationships of hybrid strategy with process and product innovation. This sheds light on how and when hybrid strategy is most effective in fostering SME performance.

We highlight that SMEs need to establish strategies that use diverse resources and capabilities and not just generate competitive advantage using one strategy (cost leadership or differentiation strategy). This requires an agile and flexible systems and structures.

Our research provides novel results by proposing the adoption of hybrid strategies instead of pure strategies (cost leadership and differentiation strategy) as a way for SMEs to survive during crises. Unlike “stuck in the middle” strategies, our study demonstrates the importance of hybrid strategies in a comprehensive model that links them to innovation and firm performance, with adaptive capacity being a determining factor.

Although strategic scholars have made great effects to exploring the moderating roles of team interaction in explaining the effect of top management team (TMT) diversity, they have adopted seemingly conflicting theoretical perspectives to explain how it works. Drawing on ideas from the threat rigidity theory, the authors integrated these perspectives by proposing a contingency model in which the relationships between TMT diversity and adaptive firm performance depend on the matching between the internal context (i.e. overlapping team tenure) and external context (i.e. severity of threat).

This study sampled 579 Chinese A-share listed companies that have been severely affected by the COVID-19 pandemic, and multilevel linear regression analysis was used to test the hypothesis.

Results provided support for this hypothesis. Specifically, the interaction between TMT age/tenure diversity and overlapping team tenure is significant only when the severity of threat is high, while the interaction between TMT functional diversity and overlapping team tenure is significant only when the severity of threat is low.

The results of this study provide a comprehensive perspective to predict the performance impact of team diversity and contribute to diversity research and practice.

In view of a disruptive environment, the authors consider theories that explain left-skewed performance outcomes and inverse risk–return relationships where some rationales imply causal dependencies with slightly differing outcomes while others refer to spurious artifacts. These literatures are briefly outlined and dynamic response capabilities introduced as an alternative perspective expressed as strategic responsiveness where commonly observed performance outcomes derive from heterogeneous response capabilities among firms that compete in dynamic environments. Financial performance outcomes are analyzed empirically based on a comprehensive corporate dataset where computational simulations of adaptive strategy making among firms generate comparable outcomes from a simple strategic responsiveness model. The findings demonstrate how diverse adaptive strategy-making processes can generate a substantial part, if not all, of the commonly observed artifacts of firm financial performance. The implications of these results are discussed pointing to propitious approaches of analyzing the impact of dynamic adaptive strategies.

This chapter explores other theoretical explanations to the commonly observed phenomenon of negatively skewed performance outcomes and inverse risk-return relationships in empirical firm data. The analysis conducted in many prior studies have implicated direct causal dependencies between performance and risk, or vice versa, with the possibility of simultaneous two-way relationships that are harder to discern. It is also shown how spurious artifacts deriving from the arithmetic links between mean and variance associate left-skewed distributions with negative mean variance correlations. However, the heterogeneous display of response capabilities among firms that compete in the same industry contexts may provide an alternative explanation for the observed performance characteristics. This is expressed as strategic responsiveness where performance outcomes with high negative skewness and excess kurtosis derive from heterogeneous adaptive processes among firms as they respond to a dynamic environment with different degrees of success. We test these results in different simulated competitive contexts disrupted by major unexpected events and find robust results across different environmental scenarios. The analysis looks at two different response processes, one modeled as conventional adaptive planning following an annual budget cycle, and another modeled as interactive updating where executives have frequent informative budget discussions with operating managers in the firm. The computational simulations show that interactive updating generates outcomes with higher returns and lower performance risk for moderate learning levels and restructuring costs. However, the resulting performance distributions are not as left-skewed as those observed in the empirical data that show higher resemblance to the adaptive planning outcomes.

Marketing adaptation has been considered a factor critical to a firm′s success in international markets. In order to know how companies can effectively adapt their marketing activities to international markets, one has to go beyond marketing function to understand the development of a firm′s experience curve advantage. Presents a framework for a firm to improve its adaptive abilities in developing appropriate marketing strategies for global expansion. Strategic managers should manage the process of investing organizational slacks in order to enhance adaptive ability. Globally‐oriented Taiwanese PC firms were studied to examine the relationship between a firm′s adaptive ability and its performance. Indicates that companies can improve performance by enhancing their adaptive abilities in the areas of technology, marketing mix and finance. Suggests further research.

The author introduces a strategic responsiveness model that reflects an organization’s ability to sense environmental changes and learn from emergent adaptive responses that attempt to realign organizational activities and gain a better fit with the changing conditions. The author shows in computational simulations how superior strategic adaptation is associated with higher average returns and lower performance risk among firms that compete in the same industry contexts and generate negatively skewed outcome distributions consistent with empirical observations. The model is refined to incorporate an interactive strategy-making process, where experiential insights from decentralized initiatives update forward-looking projections in central planning. The ensuing analysis demonstrates how this adaptive strategy-making approach further enhances the favorable risk-return outcomes. The author discusses these findings and the implications for the study of dynamic adaptive strategy-making processes.

This paper aims to examine how the efficacy of organizational routines varies and the mechanism through which organizational routines improve firm performance.

A theoretical model is proposed and tested using data from 53 interviews with financial services experts and 291 survey responses from financial advisors.

Operational and adaptive routines work through absorptive capacity to positively contribute to firm performance. The positive effects of adaptive routines are magnified under market governance.

The examination of organizational routines is focused on routines at the firm level. Therefore, higher corporate-level routines were not measured. Response rate for the survey is a possible concern, so future research will benefit from increasing the response rate from the focal population.

This study benefits firms facing the dual role of customization and discipline in working with clients toward service delivery. The findings suggest that firms should develop both operational and adaptive routines, particularly when operating under market governance.

This study identified two categories of routines (operational and adaptive) and the circumstances in which the causal link between routines and performance varies. This study examined the potential moderating influence of a governance mode (market vs hierarchy). Absorptive capacity was identified as a mediator between the use of routines and firm performance.

In this study, we examine the influence of different components of dynamic capabilities on value-based pricing and export performance. We develop a research model investigating the three component factors of dynamic capabilities, that is, adaptive capability, absorptive capability, and innovative capability, and their respective influence on value-based pricing and export performance. Furthermore, we hypothesize a relationship between value-based pricing and export performance. Building upon a sample of 172 Austrian CEOs and marketing managers, we test our hypotheses through structural equation modeling using partial least squares. The results reveal that a firm’s adaptive capability and innovative capability both positively influence value-based pricing. Furthermore, our results show that adaptive capability has a positive influence on export performance. The relationship between value-based pricing and export performance could not be supported. Hence, we conclude that a firm’s adaptive capability plays a central role in international pricing and leads to enhanced export performance.

In the literature it is proposed that high adaptive capability is associated with high costs and internal inefficiency, despite the potential benefits to be gained from being adaptive. Investigates a set of adaptability variables that have not been previously researched and, therefore, takes an alternative focus on adaptive capability. Identifies two distinct degrees of high and low adaptive capability in an empirical UK study. Suggests that companies with high adaptive capability seemingly perform better than low adapters, despite the implication of high costs and inefficiency. High adapters also seem to have more comprehensive market orientation and decision‐making style, although they appear to operate in more turbulent external environments. The results extend the current adaptive capability literature, and directions for further research are proposed.