Innovation Capability: From Technology Development to Transaction Capability

Authors

  • Paulo Antônio Zawislak Universidade Federal do Rio Grande do Sul
  • André Cherubini Alves Universidade Federal do Rio Grande do Sul
  • Jorge Tello-Gamarra Universidade Federal do Rio Grande do sul
  • Denise Barbieux Universidade Federal do Rio Grande do Sul
  • Fernanda Maciel Reichert Universidade Federal do Rio Grande do Sul

DOI:

https://doi.org/10.4067/S0718-27242012000200002

Keywords:

operational capabilities, managerial capabilities, technological capabilities, transactional capabilities, innovation capability

Abstract

The firm’s role, besides producing goods and services, is to promote technological change and innovation. While academic research on technological capabilities has led to a better understanding of the process of technical change itself, there is no consensus on the ultimate definition of innovation capability. The purpose of this paper is to present a framework for innovation capability. This is formed by four key capabilities (technology development, operations, management and transaction) that enable firms to reach Schumpeterian profits. Given that the study is characterized as a theoretical paper, methodologically is supported on an extensive literature review. Our main findings can be summed up in three aspects: (1) every firm has all four capabilities; none of them are null; (2) to be innovative, at least one of the firm’s capabilities must be predominant; (3) any firm, when established, is primarily technological or transactional, in a second stage, operational or managerial.

Downloads

Download data is not yet available.

References

ALVES, A, C., Zen, A, C., Padula, A. D. (2011). Routines, Capabilities and Innovation in the Brazilian Wine Industry. Journal of Technology Management and Innovation. 2011, 6 (2), 128-144.

AFUAH, A.N. (2002) Mapping technological capabilities into product markets and competitive advantage’. Strategic Management Journal, 23 (2),171-179.

ARGYRES, N. (1996). Evidence on the role of firm capabilities in vertical integration decisions. Strategic Management Journal, 17 (2), 129-150.

ARGYRES, N., Mayer, K. (2007). Contract design as a firm capability: an integration of learning and transaction cost perspectives. Academy of Management Review, 32 (4), 1060-1077.

ARGYRES, N. (2011). Using organizational economics to study organizational capability development and strategy. Organization Science, 22(5), 2205-1138.

BARNARD, C. (1966). The Functions of the Executive. Harvard University Press, Cambridge. First published in 1938.

BARNEY, J. (1991). Firm resource and sustained competitive advantage. Journal of Management, 17 (1), 99-120.

BELL, M., Pavitt, K. (1995). The development of technological capabilities. Trade, Technology and International Competitiveness. Economic Development Institute of the World Bank, 69-100.

CHANDLER, Alfred D., Jr. (1977), The Visible Hand. Cambridge, Mass. and London, England: The Belknap Press of Harvard University Press.

CHANDLER, A. D. (1992). Organizational capabilities and the economic history of the industrial enterprise. Journal of Economic Perspectives, 6 (3), 79-100.

COASE, R. (1937).The nature of the firm. Economica, 4 (16), 386-405.

COHEN,W., Levinthal, D. (1990). Absorptive capacity: a new perspective on learning and innovation. Administrative Science Quarterly, 35 (1), 128-152.

DEMSETZ, H. (1968).The cost of transacting.The Quarterly Journal of Economics. 82 (1), 33-53.

DOSI, G., Nelson, R.,Winter, S. (2000). Introduction:The Nature and Dynamics of Organizational Capabilities. In: Dosi, G., Nelson, R., Winter, S. (Eds.). The Nature and Dynamics of Organizational Capabilities. Oxford University Press, New York.

DUTRÉNIT, G. (2000). Learning and knowledge Management in the firm: from knowledge accumulation to strategic capabilities. Edward Elgar, Northampton, Ma. Reprinted 2003.

FAYOL, H. (1949). General and industrial management. London, Sir Issac Pitman & Son.

FORSMAN, H. (2011). Innovation capacity and innovation development in small enterprises. A comparison between the manufacturing and service sectors. Research Policy, 40 (5), 739–750.

GARCÍA-MUIÑA F., Navas-López, J. (2007). Explaining and measuring success in new business:The effect of technological capabilities on firm results.Technovation, 27 (1-2), 30-46.

GOMEL M.M., Sbragia R. (2006). A capacitação tecnológica e o desempenho exportador da indústria brasileira de software: o papel dos investimentos em P&D. Journal of Technol- ogy Management & Innovation, 1 (3), 60-73.

GUAN, J., Ma, N. (2003). Innovative capability and export performance of Chinese firms.Technovation 23 (9), 737–747

HAYES, R. H., Pisano, G. P. (1994). Beyond world-class: The new manufacturing strategy. Harvard Business Review, 72 (1), 77-86.

HAYES, R.H., Pisano, G.P., Upton, D., Wheelwright, S. (2005). Operations, Strategy, and Technology: Pursuing the competitive edge. Hoboken:Wiley. (Brazilian translation)

HODGSON, G. (1998). Competence and contract in the theory of the firm. Journal of Economic Behavior and Or- ganization, 35 (2), 179-210.

ITAMI, H., Roehl, T. (1987). Mobilizing invisible assets. Harvard University Press,Cambridge.

JACOBIDES, M.G., Hitt, L. M. (2005). Losing sight of the forest for the trees? Productive capabilities and gains from trade as drivers of vertical scope. Strategic Management Journal, 26, 1209-1227.

JACOBIDES, M.G., Winter, S. (2005). The Co-Evolution of Capabilities and Transaction Costs: Explaining the Institutional Structure of Production. Strategic Management Journal, 26 (5), 395-413.

KIM, L. (1999). Building technological capability for industrialization: analytical frameworks and Korea’s experience. Industrial and Corporate Change, 8 (1), 111-136.

KOTABE, M., Srinivasan, S.S., Aulakh, P. (2002). Multinationality and firm performance: The moderating role of R&D and Marketing Capabilities. Journal of International Business Studies, 33 (1), 79-97.

LALL, S. (1992). Technological capabilities and industrialization.World Development, 20 (2), 165-186.

LANGLOIS, R.N. (2003). The Vanishing Hand: The Changing Dynamics of Industrial Capitalism. Industrial and Corporate Change, 12 (2), 351-385.

LANGLOIS, R. N. (2007).The Dynamics of Industrial Capitalism: Schumpeter, Chandler, and the New Economy. The Graz Schumpeter Lectures 2004. London: Routledge.

LANGLOIS, R.N., Foss, N. (1999). Capabilities and governance: the rebirth production in the theory of economic organization. Kyklos, 52 (2), 201-218.

LAZONICK, W. (1991). Business Organization and the Myth of the Market Economy. Cambridge University Press, New York.

LAZONICK,W. (1992). Business Organisation and Competitive Advantage: Capitalist Transformations in the Twentieth Century. In: Dosi, G., Giannetti, R., Toninelli, P. A. (Eds). Tech- nology and Enterprise in a Historical Perspective, Oxford University press, Oxford, 119-163.

LOASBY, B. J. (1999). Knowledge, Institutions and Evolution in Economics. Londres: Routledge.

MAYER, K., Argyres, N. (2004). Learning to contract: Evidence from the personal computer industry. Organization Science, 15 (4), 394-410.

MAYER, K., Salomon, R. (2006). Contract design as a firm capability: an integration of learning and transaction cost perspectives. Academy of Management Review, 49 (5), 942-959.

MINTZBERG, H. (1973). The Nature of Managerial Work. Harper & Row, New York.

NELSON, R., Winter, S. (1982). An Evolutionary Theory of Economic Change.The Belknap Press of Harvard University Press, Cambridge, Ma.

NOGUEIRA A.C., Bataglia,W. (2012).Transaction Costs and Organizational Competences: Explaining the Governance Structure for Manufacturing Stage. Journal of Technology Management & Innovation, 7 (1), 159-174.

PENROSE, E. (1959).The Theory of the Growth of the Firm. Oxford University Press, New York. 272p. Reprinted in 1995.

PRAHALAD, C., Hamel, G. (1990). The core competence of the corporation. Harvard Business Review, 68 (3), 79-91.

REICHERT, F. M.; Beltrame, R. S; Corso, K. B.; Trevisan, M.; Zawislak, P. A. (2011). Technological Capability’s Predictor Variables. Journal of Technology Management & Innovation, 6 (1), 14-25.

RICHARDSON, G. (1972).The organization of industry. Economic Journal, 82 (327), 883-896.

RUSH, H., Bessant, J.; Hobday, M. (1991). Assessing the technological capabilities of firms: developing a policy tool. British Journal Management, v. 2, p. 41-50.

SCHUMPETER, Joseph A. (1942). Capitalism, Socialism and Democracy. Harper, New York.

SELZNICK, P. (1957). Leadership in administration: a sociological interpretation. University of California Press, Berkeley and Los Angeles, Ca. Reprinted in 1984.

SIMON, H. (1945). Administrative Behavior. Free Press, New York. Reprinted in 1997.

SKINNER, W. (1969). Manufacturing: missing link in corporate strategy. Harvard Business Review, 47 (3), 136-145.

SKINNER,W. (1974).The focused factory. Harvard Business Review, 113-121.

SLACK, N., Lewis, M. (2008). Operations Strategy. Pearson Education, Essex.

SNOW, C., Hrebiniak, L. (1980). Strategy, distinctive competence, and organizational performance. Administrative Science Quarterly, 25 (2), 317-336.

STAMP, G. (1981). Levels And Types Of Managerial Capability. Journal of Management Studies, 18 (3), 277-298.

SRI, (2011). Sunnybrook Research Institute. Spinoff Companies & Success Stories. Available from: <http://sunnybrook.ca/research/content/?page=sri_comm_spinoff>. Accessed in Jan, 23.

TAYLOR, F. (1911). Princípios de Administração Científica. 3 ed. São Paulo: Atlas, brazilian translation in 1957.

TEECE, D. (1986). Profiting from technological innovation. Research Policy, 15 (6), 285– 305.

TEECE, D. (2006). Reflections on Profiting from Innovation. Research Policy, 35, (8), 1131-1146.

TEECE, D., Rumelt, R., Dosi, G., Winter, S. (1994). Understanding corporate coherence:Theory and evidence. Journal of Economic Behavior and Organization, 23 (1), 1 - 30.

WANG, C.-H., Lu, I.-Y., and Chen, C.-B. (2008). Evaluating firm technological innovation capability under uncertainty. Technovation, 28(6), 349-363.

WARD, P., McCreery, J., Ritzman, L., Sharma, D. (1998). Competitive priorities in operations management. Decisions Science, 29 (4), 1035-1046.

WESTPHAL, L.E., Kim, L., Dahlman, C.J. (1985). Reflections on the Republic of Korea’s acquisition of technological capability. In: Rosenberg, N., Frischtak, C. International technol- ogy transfer: concepts, measures, and comparisons. Praeger, New York.

WHITLEY, R. (1989). On the nature of managerial tasks and skills: their distinguishing characteristics and organization. Journal of Managerial Studies, 26, 209-224.

WILLIAMSON, O. (1985).The Economic Institutions of Capitalism. Free Press, New York. 450p.

WILLIAMSON, O. (1999). Strategic research: governance and competence. Strategic Management Journal, 20 (12), 1087-1108.

WINTER, S. (1991). On Coase, Competence, and the Corporation, In:Williamson, O. E.,Winter, S. (Eds.).The Nature of the Firm: Origins, Evolution, and Development. Oxford University Press, Oxford, 179-195.

YAM, R.; Lo, W.; Tang, E; Lau, A. (2011). Analysis of sources of innovation, technological innovation capabilities, and performance: An empirical study of Hong Kong manufacturing industries. Research Policy, 40 (3), 737–747.

ZHANG, S., Sood, S. (2002). “Deep” and “Surface” cues: Brand extension evaluations by children and adults. Journal of Consumer Research, 29 (1), 129-141.

ZHOU, K.Z., Wu, F. (2010). Technological capability, strategic flexibility, and product innovation. Strategic Management Journal, 31, 547-561.

ZAWISLAK, P.A., Larentis F., Machado C. and Andrade, A. (2009). Firm’s Innovation Expectation, Potential and Actions: Impressions on the Japanese Videogame Console Market. Journal of Technology Management & Innovation, 4 (4), 69-81.

Downloads

Published

2012-07-14

How to Cite

Zawislak, P. A., Cherubini Alves, A., Tello-Gamarra, J., Barbieux, D., & Reichert, F. M. (2012). Innovation Capability: From Technology Development to Transaction Capability. Journal of Technology Management & Innovation, 7(2), 14–27. https://doi.org/10.4067/S0718-27242012000200002

Issue

Section

Research Articles

Most read articles by the same author(s)

1 2 > >>