A1 Refereed original research article in a scientific journal
Dynamic capability in a small global factory
Authors: Eriksson T, Nummela N, Saarenketo S
Publisher: ELSEVIER SCIENCE BV
Publication year: 2014
Journal: International Business Review
Journal name in source: INTERNATIONAL BUSINESS REVIEW
Journal acronym: INT BUS REV
Volume: 23
Issue: 1
First page : 169
Last page: 180
Number of pages: 12
ISSN: 0969-5931
DOI: https://doi.org/10.1016/j.ibusrev.2013.03.007
Abstract
In order to balance their local and global operations optimally, SMEs are moving toward a 'global factory' type of organizational form, meaning a differentiated network of activities held together through the control of key assets and flows of knowledge, and coordinated by a focal firm. Managing such a network requires a specific dynamic capability comprising, according to our study, cognitive, managerial, and organizational capabilities. Cognitive capabilities - cultural awareness, entrepreneurial orientation, and a global mindset - are the basis for a global factory because they are the source for opportunity recognition and exploitation, and are therefore crucial. The focal firm's organizational flexibility and absorptive capacity, as well as managerial capabilities in the areas of interface competence and analytical capability, are needed in the steering of a small global factory, the success of which depends on the nurturing of these assets. (C) 2013 Elsevier Ltd. All rights reserved.
In order to balance their local and global operations optimally, SMEs are moving toward a 'global factory' type of organizational form, meaning a differentiated network of activities held together through the control of key assets and flows of knowledge, and coordinated by a focal firm. Managing such a network requires a specific dynamic capability comprising, according to our study, cognitive, managerial, and organizational capabilities. Cognitive capabilities - cultural awareness, entrepreneurial orientation, and a global mindset - are the basis for a global factory because they are the source for opportunity recognition and exploitation, and are therefore crucial. The focal firm's organizational flexibility and absorptive capacity, as well as managerial capabilities in the areas of interface competence and analytical capability, are needed in the steering of a small global factory, the success of which depends on the nurturing of these assets. (C) 2013 Elsevier Ltd. All rights reserved.
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