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

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.

Welfare Effort and Poverty from the Monetary and Capabilities Approach: A Cross-Country Analysis in Latin American and the Caribbean (1990-2010)

There is abundant empirical evidence on the negative relationship between welfare effort and poverty. However, poverty indicators traditionally used have been representative of the monetary approach, excluding its multidimensional reality from the analysis. Using three regression techniques for the period 1990-2010 and controlling for demographic and cyclical factors, this paper examines the relationship between social spending per capita —as the indicator of welfare effort— and poverty in up to 21 countries of the region. The proportion of the population with an income below its national basic basket of goods and services (PM1) and the proportion of population with an income below 50% of the median income per capita (PM2) were the two poverty indicators considered from the monetarist approach to measure poverty. From the capability approach the proportion of the population with food inadequacy (PC1) and the proportion of the population without access to improved water sources or sanitation facilities (PC2) were used. The fi ndings confi rm that social spending is actually useful to explain changes in poverty (PM1, PC1 and PC2), as there is a high negative and signifi cant correlation between the variables before and after controlling for demographic and cyclical factors. In two regression techniques, social spending per capita did not show a negative relationship with the PM2. Countries with greater welfare effort for the period 1990-2010 were not necessarily those with the lowest level of poverty. Ultimately social spending per capita was more useful to explain changes in poverty from the capability approach.

Religion and Clothing: the Capabilities Approach Considered

Proponents of the capabilities approach claim that it should be used to give guidance for the implementation of good constitutional laws. This suggests that it also gives us grounds to support attempts to create or protect constitutions based on something like the capabilities approach. The Turkish Republic claims that in order to protect secularism and the equal status of women, it needs to keep certain Islamic practices away from the public domain. The wearing of the headscarf has been singled out as such a practice, and the Turkish Republic has therefore legislated against headscarf wearing in schools, universities, and government buildings. In consequence many women are forced to choose between religion over education and politics in a way that curtails central human capabilities. Nussbaum claims that the best way to help states resolve the dilemma presented by the conflict between religious choice and other central capabilities is to refer to principles embodied in to the US Religious Freedom Restoration Act 1993, which states that a law can burden a person's exercise of religion only when the burden is a furtherance of a compelling state interest. In this paper I consider how this advice partly vindicates the Turkish case and how the solution it yields is in many ways more satisfactory than that of more traditional approaches in political philosophy.

The Capabilities Approach as a Foundation for an Ethical-Political Theory of the Good

L’approche des capabilités a été caractérisée par un développement fulgurant au cours des vingt-cinq dernières années. Bien que formulée à l’origine par Amartya Sen, détenteur du Prix Nobel en économie, Martha Nussbaum reprit cette approche dans le but de s’en servir comme fondation pour une théorie éthico-politique intégrale du bien. Cependant, la version de Nussbaum s’avéra particulièrement vulnérable à plusieurs critiques importantes, mettant sérieusement en doute son efficacité globale. À la lumière de ces faits, cette thèse vise à évaluer la pertinence théorique et pratique de l’approche des capabilités de Nussbaum, en examinant trois groupes de critiques particulièrement percutantes formulées à son encontre.

Stages of organizational transformation in transition economies: A dynamic capabilities approach

How do organizations previously dominated by the state develop dynamic capabilities that would support their growth in a competitive market economy? We develop a theoretical framework of organizational transformation that explains the processes by which organizations learn and develop dynamic capabilities in transition economies. Specifically, the framework theorizes about the importance of, and inter-relationships between, leadership, organizational learning, dynamic capabilities, and performance over three stages of transformation. Propositions derived from this framework explain the pre-conditions enabling organizational learning, the linkages between types of learning and functions of dynamic capabilities, and the feedback from dynamic capabilities to organizational learning that allows firms in transition economies to regain their footing and build long-term competitive advantage. We focus on transition contexts, where these processes have been magnified and thus offer new insights into strategizing in radically altered environments.

Approaching Migrant Youth Marginalization through the Capabilities Approach: Methodological Proposals

Adopting the capabilities approach and the terminology that has been respectively developed, we could assume that Amartya Sen’s “capabilities” consist in the actual living that people manage to achieve (“functionings”) as a result of actual free will. Sen’s freedom does not “only [depend on the] mere degree of the presence or absence of coercion or interference (from others)” (Otto and Ziegler 2006) but also on “the range of options a person has in deciding what kind of life to lead” (Dreze and Sen 1995, 10). In his book, Identity and Violence, Sen, without explicitly connecting the capabilities approach with his views on “genuine multiculturalis” (Sen 2007), in fact, introduces this extended conception of freedom in the way we examine identity matters. Since freedom becomes perceptible as the range of options a person has, concerning the kind of life he wishes to live, cultural freedom can be defined through the concept of the multiplicity of belonging. In other words, cultural freedom constitutes itself a capability, which is realized when nothing and no one, not even myself, can tie me down to a kind of cultural rigidity that tends to exclude and marginalize me. This latent connection of “capabilities” with “multiple identities” (Sen 2007) challenges us to search for the contribution Sen’s approach could have in the understanding and confrontation of issues concerning migrants, away from theoretical patterns that overemphasize the cultural otherness as an impediment to inclusion. Besides, Sen himself, without of course focusing exclusively on migrants, has already approached the matter of social exclusion with terms of his capabilities approach (Sen 2000).

Linking entrepreneural orientation to export performance: the role of intangible resources and dynamic capabilities

Understanding the determinants of international performance, and in particular, export performance is key for the success of international companies. Research in this area focuses mainly on how resources and capabilities allow companies to gain competitive advantage and superior performance in external markets. Building on the Resource-Based View (RBV) and the Dynamic Capabilities Approach (DCA), this study aims at analysing the effect of intangible resources and capabilities on export performance. Specifically, this study focuses on the proposition that entrepreneurial orientation potentiates the attraction of intangible resources, namely relational and informational resources. Moreover, we propose that these resources impact export performance both directly and indirectly through dynamic capabilities.

Why are some companies more successful than others? An exploration into organizational culture and dynamic capabilities

Why are some companies more successful than others? This thesis approaches the question by enlisting theoretical frameworks that explain the performance with internal factors, deriving from the resource-based view, namely the dynamic capabilities approach. To deepen the understanding of the drivers and barriers towards developing these higher order routines aiming at improving the operational level routines, this thesis explores the organisational culture and identity research for the microfoundational antecedents that might shed light on the formation of the dynamic capabilities. The dynamic capabilities framework in this thesis strives to take the theoretical concept closer to practical applicability. This is achieved through creation of a dynamic capabilities matrix, consisting of four dimensions often encountered in dynamic capabilities literature. The quadrants are formed along internal-external and resources-abilities axes, and consist of Sensing, Learning, Reconfiguration and Partnering facets. A key element of this thesis is the reality continuum, which illustrates the different levels of reality inherent in any entity of human individuals. The theoretical framework constructed in the thesis suggests a link between the collective but constructivist understanding of the organisation and both the operational and higher level routines, evident in the more positivist realm. The findings from three different case organisations suggest that the constructivist assumptions inherent to an organisation function as a generative base for both drivers and barriers towards developing dynamic capabilities. From each organisation one core assumption is scrutinized to identify its connections to the four dimensions of the dynamic capabilities. These connections take the form of drivers or barriers – or have the possibility to develop into one or the other. The main contribution of this thesis is to show that one key for an organisation to perform well in a turbulent setting, is to understand the different levels of realities inherent in any group of people. Recognising the intangible levels gives an advantage in the tangible ones.

Which way out of poverty? the human capital versus human capabilities approaches

La pobreza es un problema mundial que afecta a personas de diferentes maneras. El propósito de este artículo es explorar dos teorías principales que abordan la pobreza y la posibilidad de su superación, que son los enfoques de capital humano y de capacidades humanas. El enfoque del capital humano se centra exclusivamente en la faceta económica de la pobreza; en esta perspectiva, la pobreza se define como la falta de dinero y puede abordarse mediante el aumento de los ingresos financieros de las personas que viven en la pobreza. El enfoque de las capacidades humanas ve la pobreza como un problema multidimensional que va más allá de la economía para áreas como la salud, la educación y la libertad. Este enfoque se orienta hacia el cambio social y ayudar a las personas en situación de pobreza para descubrir y desarrollar su potencial. El autor considera que las capacidades humanas abarcan con mayor precisión el alcance de la pobreza y las personas afectadas por el mismo, aunque debido a su amplia gama ha sido difícil diseñar e implementar políticas eficaces que aborden todas las facetas de la pobreza.

On IT governance structures and their effectiveness in collaborative organizational structures

Organizations today engage in various forms of alliances to manage their existing business processes or to diversify into new processes to sustain their competitive positions. Many of today’s alliances use the IT resources as their backbone. The results of these alliances are collaborative organizational structures with little or no ownership stakes between the parties. The emergence of Web 2.0 tools is having a profound effect on the nature and form of these alliance structures. These alliances heavily depend on and make radical use of the IT resources in a collaborative environment. This situation requires a deeper understanding of the governance of these IT resources to ensure the sustainability of the collaborative organizational structures. This study first suggests the types of IT governance structures required for collaborative organizational structures. Semi-structured interviews with senior executives who operate in such alliances reveal that co-created IT governance structures are necessary. Such structures include co-created IT-steering committees, co-created operational committees, and inter-organizational performance management and communication systems. The findings paved the way for the development of a model for understanding approaches to governing IT and evaluating the effectiveness for such governance mechanisms in today’s IT dependent alliances. This study presents a sustainable IT-related capabilities approach to assessing the effectiveness of suggested IT governance structures for collaborative alliances. The findings indicate a favourable association between organizations IT governance efforts and their ability to sustain their capabilities to leverage their IT resources. These IT-related capabilities also relate to measures business value at the process and firm level. This makes it possible to infer that collaborative organizations’ IT governance efforts contribute to business value.

Creating and evaluating IT-related business value in developing markets - Part 2

A deeper understanding on two aspects of use of IT resources in organisations is important to ensure sustainable investment in these IT resources. The first is how to leverage the IT resources to attain its maximum value. We discussed this aspect of use of IT resources in part 1 of this series. This discussion suggested a complementary approach as a first stage of IT business value creation, and dynamic capabilities approach to secure sustainable IT-related business value from the IT resources. The second important aspect of IT business value is where to evaluate IT-related business value in the organisations value chains. This understanding is important for organisations to ensure appropriate accountability of the investment and management of IT resources. We address this issue in this second part of the two part series.

A capability-based view of organisational renewal : Combining opportunity- and advantage-seeking growth in large, established European and North American wood-industry companies

The purpose of this study was to extend understanding of how large firms pursuing sustained and profitable growth manage organisational renewal. A multiple-case study was conducted in 27 North American and European wood-industry companies, of which 11 were chosen for closer study. The study combined the organisational-capabilities approach to strategic management with corporate-entrepreneurship thinking. It charted the further development of an identification and classification system for capabilities comprising three dimensions: (i) the dynamism between firm-specific and industry-significant capabilities, (ii) hierarchies of capabilities and capability portfolios, and (iii) their internal structure. Capability building was analysed in the context of the organisational design, the technological systems and the type of resource-bundling process (creating new vs. entrenching existing capabilities). The thesis describes the current capability portfolios and the organisational changes in the case companies. It also clarifies the mechanisms through which companies can influence the balance between knowledge search and the efficiency of knowledge transfer and integration in their daily business activities, and consequently the diversity of their capability portfolio and the breadth and novelty of their product/service range. The largest wood-industry companies of today must develop a seemingly dual strategic focus: they have to combine leading-edge, innovative solutions with cost-efficient, large-scale production. The use of modern technology in production was no longer a primary source of competitiveness in the case companies, but rather belonged to the portfolio of basic capabilities. Knowledge and information management had become an industry imperative, on a par with cost effectiveness. Yet, during the period of this research, the case companies were better in supporting growth in volume of the existing activity than growth through new economic activities. Customer-driven, incremental innovation was preferred over firm-driven innovation through experimentation. The three main constraints on organisational renewal were the lack of slack resources, the aim for lean, centralised designs, and the inward-bound communication climate.

From Habits to Social Structures : Pragmatism and Contemporary Social Theory

Pragmatism has sometimes been taken as a catchphrase for epistemological stances in which anything goes. However, other authors argue that the real novelty and contribution of this tradition has to do with its view of action as the context in which all things human take place. Thus, it is action rather than, for example, discourses that should be our starting point in social theory. The introductory section of the book situates pragmatism (especially the ideas of G. H. Mead and John Dewey) within the field and tradition of social theory. This introductory also contextualizes the main core of the book which consists of four chapters. Two of these chapters have been published as articles in scientific journals and one in an edited book. All of them discuss the core problem of social theory: how is action related to social structures (and vice versa)? The argument is that habitual action is the explanation for the emergence of social structures from our action. Action produces structures and social reproduction takes place when action is habitualized; that is, when we develop social dispositions to act in a certain manner in familiar environments. This also means that even though the physical environment is the same for all of us, our habits structure it into different kinds of action possibilities. Each chapter highlights these general insights from different angles. Practice theory has gained momentum in recent years and it has many commonalities with pragmatism because both highlight the situated and corporeal character of human activity. One famous proponent of practice theory is Margaret Archer who has argued that the pragmatism of G. H. Mead leads to an oversocialized conception of selfhood. Mead does indeed present a socialized view of selfhood but this is a meta-sociological argument rather than a substantial sociological claim. Accordingly, one can argue that in this general sense intersubjectivity precedes subjectivity and not the other way around. Such a view does not indicate that our social relation would necessarily "colonize" individual action because there is a place for internal conversations (in Archer s terminology); it is especially in those phases of action where it meets obstacles due to the changes of the environment. The second issue discussed has the background assumption that social structures can fruitfully be conceptualized as institutions. A general classification of different institution theories is presented and it is argued that there is a need for a habitual theory of institutions due to the problems associated with these other theories. So-called habitual institutionalism accounts for institutions in terms of established and prevalent social dispositions that structure our social interactions. The germs of this institution theory can be found in the work of Thorstein Veblen. Since Veblen s times, these ideas have been discussed for example, by the economist Geoffrey M. Hodgson. His ideas on the evolution of institutions are presented but a critical stance is taken towards his tendency of defining institutions with the help of rules because rules are not always present in institutions. Accordingly, habitual action is the most basic but by no means the only aspect of institutional reproduction. The third chapter deals with theme of action and structures in the context of Pierre Bourdieu s thought. Bourdieu s term habitus refers to a system of dispositions which structure social fields. It is argued that habits come close to the concept of habitus in the sense that the latter consists of particular kinds of habits; those that are related to the reproduction of socioeconomic positions. Habits are thus constituents of a general theory of societal reproduction whereas habitus is a systematic combination of socioeconomic habits. The fourth theme relates to issues of social change and development. The capabilities approach has been associated with the name of Amartya Sen, for example, and it underscores problems inhering in economistic ways of evaluating social development. However, Sen s argument has some theoretical problems. For example, his theory cannot adequately confront the problem of relativism. In addition, Sen s discussion lacks also a theory of the role of the public. With the help of arguments derived from pragmatism, one gets an action-based, socially constituted view of freedom in which the role of the public is essential. In general, it is argued that a socially constituted view of agency does not necessarily to lead to pessimistic conclusions about the freedom of action.

Recovering Nussbaum's aristotelian roots

Abstract: The paper examines the relationship between Creating Capabilities and political liberalism. Originally founded on the basis of Aristotelian philosophy, the theory of ‘capabilities’ developed by Nussbaum turns to political liberalism in the mid 90’s. Throughout the article, the principles of both perspectives are depicted and contrasted, focusing on the capacity of affiliation, the concept of common good and the idea of freedom. Severine Deneulin argues that the current reality calls for the capabilities approach to be more rooted in a relational anthropology which the Aristotelian ethical tradition is more akin to. This line can be found in Nussbaum’s first approach to the theory of capabilities, where affiliation as an architectonic capability leads to the common good being the end of political action, and practical reason as an architectonic capability leads to reasoning ordered towards the achievement of the common good, to the detriment of individualism.

Moradia como Liberdade

A habitação de interesse social decorre da existência do déficit habitacional que não é passível de ser enfrentado pela lógica do mercado imobiliário. Conforme aponta omainstreamda economia regional, a cidade é foco do crescimento mundial devido ao fluxo de informações e conhecimento; é nas cidades que o déficit habitacional se concentra e por isso o acesso a ela se torna tão relevante. O déficit habitacional urbano confirma a teoria de que habitar no centro urbano é algo que se valorize, deste modo o acesso à cidade é significativo para a expansão da liberdade. Não obstante, nossas observações confirmam que a maioria dos investimentos do Minha Casa Minha Vida do município do Rio de Janeiro são nas periferias urbanas, com infraestrutura precária, o que dificulta o acesso à cidade e ao trabalho, o pode ser um entrave para o desenvolvimento socioeconômico do Brasil. Desse modo, este trabalho analisa a moradia pela abordagem seniana das capacidades. Esta abordagem se faz relevante por considerar fatores sociológicos importantes para a superação da condição de privação econômica e social dos cidadãos. A pesquisa consiste na mensuração do déficit habitacional com a utilização dos dados do Censo Demográfico 2010 do IBGE. O trabalho consiste num esforço para delinear a satisfação e do acesso a cidade dos moradores do Rio de Janeiro que foram beneficiados pelo Programa Minha Casa Minha Vida. Este trabalho ressalta a importância do acesso à cidade bem como da moradia para a expansão das liberdades e para o desenvolvimento do país.