The role of the market sub-system and the socio-technical sub-system in innovation and firm performance: A dynamic capabilities approach

Jay Weerawardena*, Gillian Sullivan Mort, Sandeep Salunke, Gary Knight, Peter W. Liesch

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

72 Citations (Scopus)

Abstract

Organizational learning has been studied as a key factor in firm performance and internationalization. Moving beyond the past emphasis on market learning, we develop a more complete explanation of learning, its relationship to innovation, and their joint effect on early internationalization. We theorize that, driven by the founders’ international vision, early internationalizing firms employ a dual subsystem of dynamic capabilities: a market subsystem consisting of market-focused learning capability and marketing capability, and a socio-technical subsystem comprised of network learning capability and internally focused learning capability. We argue that innovation mediates the proposed relationship between the dynamic capability structure and early internationalization. We conduct case studies to develop the conceptual framework and test it in a field survey of early internationalizing firms from Australia and the United States. Our findings indicate a complex interplay of capabilities driving innovation and early internationalization. We provide theoretical and practical implications and offer insights for future research.

Original languageEnglish
Pages (from-to)221-239
Number of pages19
JournalJournal of the Academy of Marketing Science
Volume43
Early online date3 Apr 2014
DOIs
Publication statusPublished - Mar 2015

Keywords

  • Born globals
  • Dynamic capabilities
  • Early internationalization
  • Innovation
  • International vision
  • Marketing capability
  • Organizational learning
  • Organizational subsystems

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