Impact of Dynamic Capabilities on Performance in Dairy Sheep Farms in Spain

Abstract

This study links the dynamic capabilities (DCs) theory with performance in dairy sheep farms in Castilla La Mancha (central Spain). The approach is novel as it seeks to understand how best results can be achieved by deploying DCs in farms. The proposal is that dynamic capabilities are interrelated to each other and present a positive impact on the farm’s economic sustainability. A mixed methods approach (a combination of qualitative and quantitative methods of research) was utilized. First, 30 indicators of dynamic capabilities (8 of absorption, 11 of integration, 9 of innovation, and 2 of profits) were selected by applying Delphi’s methodology. Second, a structural equation model (SEM) was applied over a random sample of 157 dairy sheep farms to measure the relationship between DCs and the impact of each capability on farms’ final performance. The existence of positive relationships amongst absorption, integration, and innovation capabilities was evidenced. Absorption and integration capabilities exhibited positive influences on a farm’s final performance. The knowledge of the relationships amongst dynamic capabilities is a new orientation to increase farms’ viability. These findings reveal that the application of the dynamic capabilities theory can explain best farms’ economic sustainability.

Small agricultural businesses' performance—What is the role of dynamic capabilities, entrepreneurial orientation, and environmental sustainability commitment?

“…This happens because many fresh fruit entrepreneurs adopt business-to-business environmental schemes required by the large distribution as GlobalGap and Integrated Farming (Muller & Vermeulen, 2009;Tasca et al, 2017), which consumers have little knowledge and not provide price premiums (Ras & Vermeulen, 2009). Despite fruit growing is considered an intensive agricultural system in terms of pesticides, fertilizers, and financial capital (Cerutti et al, 2014), other subsectors have deeper environmental impacts as greenhouse horticulture (Galdeano-Gómez et al, 2008) or livestock production (Cerutti et al, 2014) and may not present adequate innovation capabilities as well as entrepreneurial strategies, especially the smaller ones (Bastanchury-López et al, 2020). As the agricultural sector is not homogeneous (McElwee, 2008), it is thus essential that the entrepreneurial behavior of farmers should be analyzed in keeping with the differences not only between regions but also between subsectors.…”

“…Further studies must analyze different sectors, including both fresh and packaged products, to identify the role of MCs in developing entrepreneurial opportunities, essentially those interrelated with environmental preservation. As the environmental impacts and the type of DCs also seem to differ between crop and livestock sectors (Bastanchury‐López et al, 2020), future studies should also take into account the relationships prevailing between EO, DCs, and EP.…”

The Project-Based Firm: A Theoretical Framework for Building Dynamic Capabilities

“…Our dynamic capability framework also contributes to literature streams that have approached dynamic capabilities to improve performance in a sustainable mode since it helps to clarify the routines behind building dynamic capabilities, hence facilitating decision-making for those small and medium companies that deploy ecological or sustainable initiatives as a strategy for promoting a new business model [48,62].…”

Redes, conocimientos y capacidades en el contexto de la industria del software. Análisis del caso Bahía Blanca

“…Dado que este proceso resulta ser de carácter interno (endógeno) y relacional (ya que se realiza interactuando con otros) suele denominarse proceso de construcción de capacidades dinámicas. Además, el término dinámico alude a su perfil evolutivo, ya que se da a lo largo del tiempo (Bastanchury-López et al, 2020;Villaroel-Molina et al, 2021).…”