Jim Dewald

Identifying, Enabling and Managing Dynamic Capabilities in the Public Sector

In this paper, we examine how a public sector organization developed a new strategic approach based on the identification and use of an internal dynamic capability (learning through experimenting). In response to the need for continual performance improvement in spite of reduced financial resources, this organization engaged in three overlapping phases as they shifted to this strategic approach. First, managers identified appropriate latent dynamic capabilities. Next, they used their leadership skills and built on established levels of trust to enable the use of these dynamic capabilities. Finally, they managed the tension between unrestricted development of local initiatives and organizational needs for guidance and control.

Storm Clouds and Silver Linings: Responding to Disruptive Innovations Through Cognitive Resilience

Incumbent firms facing disruptive business model innovations must decide whether to respond through inaction, resistance, adoption, or resilience. We focus on resilient responses to simultaneous perceived threat and opportunity by managers of small incumbent firms. Using cognitive framing arguments, we argue that risk experience moderates perceptions of opportunity, whereas perceived urgency moderates situation threat. We test our framework in the real estate brokerage context, where small incumbents face considerable challenges from disruptive business model innovations, such as discount brokers. Analysis of data from 126 real estate brokers broadly confirms our framework. We conclude with implications of our research for small business incumbents.

The Governance Paradox: Preferences of Small Vulnerable Firms in the Homebuilding Industry

This article explores the variables that drive small firms to choose quasi–integration as an alternative to vertical integration in situations of high asset frequency. Drawing on transaction cost theory and institutional approaches, we develop and test several hypotheses regarding quasi–integration among homebuilders and land developers in a major Canadian city. Our focus is on the preferences of small, vulnerable firms operating in an environment where quasi–integration has been institutionalized as a trusted form of governance. The findings indicate that the preference for quasi–integration is driven by asset specificity, bargaining power, and opportunistic expectations, supporting a paradoxical view that small, vulnerable firms pursue both efficiency and institutional legitimacy in making governance choices regarding large dominant suppliers.