Coevolution of Firm Capabilities and Industry Competition

61 Pages Posted: 21 Feb 2003

See all articles by Marc Huygens

Marc Huygens

Erasmus University Rotterdam (EUR) - Rotterdam School of Management (RSM)

Charles Baden‐Fuller

City University, London - Cass Business School; University of Pennsylvania - The Wharton School

Frans A. J. Van Den Bosch

Erasmus University Rotterdam (EUR) - Department of Strategic Management and Entrepreneurship; Erasmus Research Institute of Management (ERIM)

H. W. Volberda

Erasmus University Rotterdam (EUR) - Rotterdam School of Management (RSM); Erasmus Research Institute of Management (ERIM)

Date Written: February 2001, 11

Abstract

This paper proposes that rival firms not only search for new capabilities within their organization, but also for those that rest in their competitive environment. An integrated analysis of these search processes at both firm and industry levels of analysis shows how their interaction makes industries and firms coevolve over time. To contribute to an enhanced understanding of the concept of coevolution, a dynamic and integrative framework crossing meso and micro levels of analysis is constructed. This framework is applied to a longitudinal study of the music industry with a time-span of 120 years. The first part, a historical study, covers the period 1877 - 1990. The second part, a multiple-case study, covers the period 1990 - 1997. We conclude that search behavior drives coevolution through competitive dynamics among new entrants and incumbent firms and manifests itself in the simultaneous emergence of new business models and new organizational forms.

Keywords: coevolution, longitudinal research, music industry, competitive regime, multilevel research

JEL Classification: M, L20, L22

Suggested Citation

Huygens, Marc and Baden-Fuller, Charles and Van Den Bosch, Frans A. J. and Volberda, Henk W., Coevolution of Firm Capabilities and Industry Competition (February 2001, 11). ; Cass Business School Research Paper. Available at SSRN: https://ssrn.com/abstract=370920

Marc Huygens

Erasmus University Rotterdam (EUR) - Rotterdam School of Management (RSM)

P.O. Box 1738
Room T08-21
3000 DR Rotterdam, 3000 DR
Netherlands

Charles Baden-Fuller

City University, London - Cass Business School ( email )

106 Bunhill Row
London, EC1Y 8TZ
United Kingdom

University of Pennsylvania - The Wharton School ( email )

3641 Locust Walk
Philadelphia, PA 19104-6365
United States

Frans A. J. Van Den Bosch (Contact Author)

Erasmus University Rotterdam (EUR) - Department of Strategic Management and Entrepreneurship ( email )

RSM Erasmus University
Rotterdam, 3000 DR
Netherlands
+31 10 408 1955/2005 (Phone)
+31 10 453 0137 (Fax)

HOME PAGE: http://www.rsm.nl/fvandenbosch

Erasmus Research Institute of Management (ERIM)

P.O. Box 1738
3000 DR Rotterdam
Netherlands

Henk W. Volberda

Erasmus University Rotterdam (EUR) - Rotterdam School of Management (RSM) ( email )

P.O. Box 1738
Room T08-21
3000 DR Rotterdam, 3000 DR
Netherlands
+31 10 408 2761 (Phone)
+31 10 408 9013 (Fax)

HOME PAGE: http://www.eur.nl/fbk/dep/dep4/faculty_members/Henk_Volberda

Erasmus Research Institute of Management (ERIM)

P.O. Box 1738
3000 DR Rotterdam
Netherlands

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