Lessons For Enhancing Competitive Advantage: Dynamic Capabilities Framework

Abstract

In turbulent business environments, building and exploiting competitive advantages necessitate manufacturing companies to start new strategic initiatives. For this purpose, new product development (NPD) should be seen as dynamic capabilities (DC) that enable companies to create a better match between the configuration of a firm’s resources and changing conditions. This study aims to make use of the operationalised DC model including sensing, seizing and reconfiguration capacities in a hierarchical decision structure. A multi-case-studies approach is employed for validation of the DC assessment model on automotive companies which are categorized as European, Japanese and American. The qualitative analysis reveals the appropriate management practices underlying the micro-foundation of DC at the operational management level, which can help chief executives to implement the appropriate strategy for enhancing NPD performance. Managers can creatively leverage their companies’ DC components by conceiving of different ways to integrate these DC components into NPD projects.