Firm resources, competitive actions and performance: investigating a mediated model with evidence from the in‐vitro diagnostics industry

Abstract

Building on the resource‐based view (RBV) and competitive dynamics literatures, this paper proposes that considering resources or actions independently offers an incomplete understanding of the drivers of superior performance. Instead, we hypothesize that resources enable competitive actions and that when these actions leverage the firm's resources, superior performance results. We tested these hypotheses with panelized data on the technological resources and competitive actions of firms in the in‐vitro medical diagnostic substance manufacturing industry. The results provide substantial support for our hypotheses, specifically with respect to mediation. Our theory and results underscore how the integration of the competitive dynamics and RBV literatures can significantly improve our understanding of firm performance. Copyright © 2011 John Wiley & Sons, Ltd.

How do dynamic capabilities transform external technologies into firms’ renewed technological resources? – A mediation model

“…The key logic behind the proposed conceptual framework for the external resource path is that a firm's dynamic capabilities will change and develop in response to the attributes of external access to valuable resources, a process through which a firm's VRIN resource configurations could be renewed. This conceptual positioning is in line with the recent theoretical development regarding the DCV, which suggests that dynamism exists in the interplay between a firm's dynamic capabilities and resource base, allowing the modification of the resource base (Chen, Su, & Tsai, 2007;Ambrosini & Bowman, 2009;Peteraf & Bergen, 2003;Sirmon & Hitt, 2009;Ndofor, Sirmon, & He, 2011;Newbert, 2008). Figure 1 here…”

“…The DCV focuses on a firm's abilities to purposefully create, extend or modify its resource base (Helfat et al, 2007). It suggests that resources can influence performance only to the extent that a firm can leverage and renew them with organizational capabilities (Ndofor, Sirmon, & He, 2011;Hitt, Ireland, & Lee, 2000). Recently, it has been suggested that the RBV and the DCV must be understood as complementary perspectives that explain firms' performance to avoid the use of underspecified models and erroneous conclusions (Sirmon & Hitt, 2009;Ndofor, Sirmon, & He, 2011).…”

“…Dynamic capabilities are "routines" because they are repetitious and purposefully patterned (Winter, 2003;Teece, Pisano, & Shuen, 1997); they are also "activities" because they are continuously "in action" in response to changes in a firm's resource configuration and external environment (Zollo & Winter, 2002;Ambrosini & Bowman, 2009). Scholars have studied various actionable microfoundations of dynamic capabilities, such as research and development (R&D) investments (Tsai, Hsieh, & Hultink, 2011;Lane & Lubatkin, 1998), integrating activities (Sen & Rubenstein, 1989), and technology diversification (Ndofor, Sirmon, & He, 2011;Argyres, 1996).…”

“…The multi-level perspective of organizational capabilities (Collis, 1994) provides us with a foundation to conceptualize a firm's dynamic technological capabilities and define its measurable microfoundations. We focus on two microfoundations of dynamic technological capabilities -in-house R&D investment (Chesbrough, 2003;Chandler & Hikino, 1990;Mowery & Rosenberg, 1998) and technological diversification (Ndofor, Sirmon, & He, 2011;Sen & Rubenstein, 1989). First, inhouse R&D is essential for an industrial firm to enhance its technological innovation performance (Sun & Du, 2010;Li-Ying & Wang, 2015).…”

Social Capital and Learning Advantages: A Problem of Absorptive Capacity

“…We use the Sobel Test (one-tailed) to determine the extent of mediation. For full mediation, the Sobel test Z-value must exceed 1.645 for 5% significance (or 1.282 for 10% significance) and the effect ratio should exceed 0.8; for partial mediation, the Sobel test Z-value must exceed 1.645 (or 1.282 for 10% significance) and the effect ratio be lower than 0.8 (Ndofor, Sirmon, and He, 2011). This mediation effect is supported as the path from absorptive capacity to performance is positive and significant for all forms of performance and the mediation effect is partial in each case (Appendix).…”