Professor of Strategy
2011 Prix Académique de la Recherche en France Strategy/Finance/Corporate Governance Category
Modes of Capability Acquisition; Selection Capability; Resource Gap; Institutional Gap; Internal Development; External Sourcing;
The dynamic capabilities literature suggests that firms need to use both internal development and external sourcing in order to thrive over time, but we have a limited understanding of the conditions that best suit different sourcing choices.This study examines how constraints that arise from firms' existing stocks of capabilities and from their internal social contexts shape their choices of capability sourcing modes and, in turn, their ability to obtain new capabilities. Thus, the research focuses on an under-emphasized form of dynamic capability: the ability to select appropriate modes of capability sourcing.The authors test the arguments with a survey and longitudinal survival study of the international telecommunications industry.The authors find intriguing variations in the way that firms' selection capability influences their ability to renew their capabilities and, ultimately, to survive.