Aligning Firm Capabilities with Customer Needs: Unpacking Dynamic Managerial Capabilities

39 Pages Posted: 9 Apr 2012

See all articles by Tim Coltman

Tim Coltman

University of Wollongong - Faculty of Business (BUS)

Timothy M. Devinney

University of Manchester - Alliance Manchester Business School

Pierre J. Richard

University of New South Wales (UNSW) - Management; UNSW Australia Business School, School of Economics

Date Written: April 1, 2012

Abstract

Organizations are complex systems that require mixtures of capabilities that interact in potentially quite complex ways both within and across points in time. This is particularly true of the dynamic managerial capability in sensing and seizing market opportunities. This study uses an experimental methodology to examine how managers make decisions that align necessary capabilities inside the firm with diverse customer types. Our results reveal that the resource allocation decisions made by managers vary in important ways. In highly commoditized markets managers rely on an intense utilization of discrete operational capabilities that are superior to the competition. In highly differentiated markets these same managers depend on interactions amongst complementary capabilities to enhance the service offering. These results imply that dynamic managerial capabilities can be ambidextrous, in the sense that managers rely on the same set of capabilities for dual purposes.

Keywords: dynamic capability, discrete choice analysis, ambidexterity

JEL Classification: M1, M21

Suggested Citation

Coltman, Tim and Devinney, Timothy M. and Richard, Pierre J., Aligning Firm Capabilities with Customer Needs: Unpacking Dynamic Managerial Capabilities (April 1, 2012). Available at SSRN: https://ssrn.com/abstract=2036617 or http://dx.doi.org/10.2139/ssrn.2036617

Tim Coltman

University of Wollongong - Faculty of Business (BUS) ( email )

Building 40A, Level 2
NSW, 2522
Australia
+61 (2) 4221 3912 (Phone)
+61 (2) 9313 7279 (Fax)

Timothy M. Devinney (Contact Author)

University of Manchester - Alliance Manchester Business School ( email )

Booth Street West
Manchester, M15 6PB
United Kingdom

Pierre J. Richard

University of New South Wales (UNSW) - Management ( email )

Sydney, NSW 2052
Australia

UNSW Australia Business School, School of Economics ( email )

High Street
Sydney, NSW 2052
Australia

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