Fernanda Maciel Reichert

Innovation Capability: From Technology Development to Transaction Capability

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.

Technological Capability's Predictor Variables

The aim of this study was to identify the factors that influence in configuration of the technological capability of companies in sectors with medium-low technological intensity. To achieve the goal proposed in this article a survey was carried out. Based on the framework developed by Lall (1992) which classifies firms in basic, intermediate and advanced level of technological capability; it was found that the predominant technological capability is intermediate, with 83.7% of respondent companies (plastics companies in Brazil). It is believed that the main contribution of this study is the finding that the dependent variable named “Technological Capability” can be explained at a rate of 65% by six variables: development of new processes; selection of the best equipment supplier; sales of internally developed new technology to third parties; design and manufacture of equipment; study of the work methods and perform inventory control; and improvement of product quality.