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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.

Purpose The aim of this study is to identify and analyze empirical evidence, which verifies the existence of the transactional capability construct in firms of financial systems in two different countries. Design/methodology/approach This study investigates how the dimensions, and sub dimensions, of the transactional capability construct are reflected in the design of contracts. When analyzing the information from personal consumption loan contracts of nine Spanish firms and ten Peruvian firms in the financial system of each country, generalizable evidence of the transactional capability can be identified. Findings The main result of this study is the identification of empirical evidence that proves the existence of transactional capability in financial markets with different characteristics. Research limitations/implications This study was limited by a lack of similar research, which hampered the task of identifying and defining the dimensions that form the transactional capability construct. Originality/value The identification of transactional capability was based on the analysis of contracts of personal credit consumption in the Peruvian and Spanish financial systems.

Aunque existen estudios sobre los límites de la firma, este campo de estudio sigue siendo un tema que necesita mayor desarrollo. El objetivo de este artículo es analizar los límites de la firma a la luz de las capacidades tecnológica y transaccional. El método utilizado fue el estudio de casos múltiples en firmas de diferentes estratos de intensidad tecnológica. Los principales resultados de este estudio pueden expresarse mediante tres proposiciones. Primero, todas las firmas industriales tienen capacidad tecnológica y capacidad transaccional. Segundo, las firmas con capacidades más desarrolladas (tecnológica y transaccional) amplían sus límites. Tercero, las firmas pueden ampliar sus límites acumulando capacidad tecnológica, capacidad transaccional o ambas. Como conclusión del artículo, las capacidades tecnológicas y transaccionales son esenciales para la expansión de las fronteras de las firmas en cualquier extracto de intensidad tecnológica. Although there is research pertaining to the boundaries of firms, this field of study still requires more development. The objective of this paper is to analyse firm boundaries considering technological and transactional capabilities. The method chosen was that of multiple case studies conducted in firms having different technological intensity levels. The main results are contained in three propositions. Firstly, all industrial firms have technological and transactional capability. Secondly, firms with more developed capabilities (technological and transactional) expand their boundaries. Thirdly, the firms are able to expand their boundaries by means of the accumulation of technological capability, transactional capability, or both. As a conclusion to this paper, technological and transactional capabilities are essential for expanding the boundaries of firms at any level of technological intensity.

This essay revisits my 2014 JIBS article about the potential for integrating international business internalization theory with a strategic management capabilities perspective. It recaps the capabilities framework with an emphasis on the learning required of emerging market multinationals and illustrates this with the case of Hyundai Motor Company’s internationalization and growth. It also discusses two aspects of the global economy that have become more prominent since 2014 in shaping international business: geopolitical uncertainty and digitalization. A rise in geopolitical tensions appears to be rebalancing the relationships between multinationals and home/host governments. Digitalization facilitates international business; but it adds new vulnerabilities by (further) accelerating competition, enabling new rivals, and introducing systemic risks into digital supply chains. Implications for managers, board members, and international business scholars are drawn.

Research on entrepreneurial ecosystems has largely taken a macro-perspective to better conceptualize and map the determinants and evolution of entrepreneurial ecosystems, yet has neglected the micro-level interactions of various entrepreneurial ecosystem actors. Recent criticisms of entrepreneurial ecosystems have centered on the lack of explicit case and effect relationships, attribution, units of analysis, the different use of network definitions as well as the static nature of existing frameworks. The purpose of our paper is to present a micro level principal investigator (PI)-centered governance framework that addresses these posited criticisms and in doing so identifies the value creation indicators (benefits), PI capabilities, the problem categories (costs), and solving mechanisms that PIs can use to govern effectively and efficiently large-scale publicly funded research programs. In leading such research programs, PIs interact with different actors within entrepreneurial ecosystems and manage governance issues, conflicts, and tensions effectively at the micro level to deliver the anticipated benefits and costs for each actor. Our framework provides the basis for future empirical research on entrepreneurial ecosystem as we have attributed cause and effect at an individual actor level and conceptualized the governance challenges at a micro rather than at the macro level that overcomes the static nature of previous frameworks.

In responding to the Forsgren and Holm (2021) critique of internalization theory, we develop a capability-based model of internalization and quasi-internalization, highlighting the key role of the international recombination of assets. With external control mechanisms becoming more sophisticated, full internalization has become increasingly unnecessary. Rather, the capacity to orchestrate complex networks is an increasingly important source of competitive advantage. We demonstrate that internalization theory does not need to assume that the MNE is all powerful, or that it can dictate the choice of mode with its foreign business partners. We also disagree with the argument that internalization theory presumes perfect rationality. When managers’ perceptions deviate from reality, they do indeed make wrong choices (over- and under-internalization) that come with various types of efficiency penalties. We share the Forsgren and Holm view that a learning perspective can provide insights on the evolution of an MNE’s asset recombination mode, as it gains experience and knowledge. Furthermore, we show that internalization theory has been extended to incorporate such a learning perspective.

Enterprises’ resources and capabilities determine their ability to achieve competitive advantage. In this regard, the key innovation challenges that enterprises face are liabilities associated with their age and size, and the entry barriers imposed on them. In this line, a growing number of enterprises are starting to implement innovation practices in which they employ both internal/external flows of knowledge in order to explore/exploit innovation in collaboration with commercial or scientific agents. Within this context, universities play a significant role providing fertile knowledge-intensive environments to support the exploration and exploitation of innovative and entrepreneurial ideas, especially in emerging economies, where governments have created subsidies to promote enterprise innovation through compulsory university partnerships. Based on these ideas, the purpose of this exploratory research is to provide a better understanding about the role of universities on enterprises’ innovation practices in emerging economies. More concretely, in the context of Mexico, we explored the enterprises’ motivations to collaborate with universities in terms of innovation purposes (exploration and exploitation) or alternatives to access to public funds (compulsory requirement of being involved in a university partnership). Using a sample of 10,167 Mexican enterprises in the 2012 Research and Technological Development Survey collected by the Mexican National Institute of Statistics and Geography, we tested a multinomial regression model. Our results provide insights about the relevant role of universities inside enterprises’ exploratory innovation practices, as well as, in the access of R&D research subsidies.

The purpose of this paper is to examine the hypothesis that increased participation in global value chains (GVCs), such as assembly of imported parts for exports, leads to higher economic growth. The focus is particularly on the extent to which this holds for low-income countries, and the role that capability-building, i.e. development of the national innovation system, plays in the possibility of benefitting from GVCs. The analysis is based on evidence from 125 countries over the period 1997–2013. To analyse the issue, a comprehensive framework that allows for inclusion of a range of relevant factors, including GVC participation (measured by the foreign value added embodied in a country’s exports), is applied. The results suggest that countries that increase GVC participation do not grow faster than other countries, when other relevant factors are controlled for. Small countries, and countries with low capabilities, appear to be particularly disadvantaged.

Building on the organizational capabilities view, this study explores the impact of network and managerial capabilities on the performance of entrepreneurial firms in the architecture and real estate sector. We apply an extended organizational capabilities model by integrating Porter's value chain model and Grant's hierarchy of organizational capabilities. Starting from differences in entrepreneurial orientation between architecture and real estate development firms, we argue that under higher environmental uncertainty, network capabilities are more important for the performance of architecture firms whereas managerial capabilities are more important for the performance of real estate development firms. Employing data from Austria, Germany, and Switzerland, the research results support the hypotheses. This study integrates Porter's value chain concept and the organizational capabilities model and delivers a contribution to the organizational capability theory. In addition, it contributes to the entrepreneurship literature by showing that network capabilities are more important for creating competitive advantage in entrepreneurial firms than in other firms.

We propose a typology that captures the heterogeneity of international new ventures’ (INVs’) entrepreneurial behavior and their commitment to foreign markets. The typology identifies four types of INVs, highlighting the dynamic interplay between the degree of radicalness of their entrepreneurial behavior and the level of their foreign market commitment. By integrating theories from both international business and entrepreneurship, we illustrate how the diverse underlying capabilities and networks of different INV types provide strategic advantages. Moreover, we argue that changes in the degree of radicalness in INVs’ entrepreneurial behavior over time reveal important temporal dynamics with strategic and performance implications. Our typology addresses a limitation in international entrepreneurship research by emphasizing the INVs’ entrepreneurial essence, which has often been overlooked. Prior conceptualizations of INVs have primarily focused on aspects such as the degree and mode of internationalization, neglecting the diversity of their entrepreneurial approaches. Consequently, our understanding of the sources of INVs’ competitive advantage and resilience in international markets has been limited. Our typology offers an array of novel research questions that merit thorough empirical and theoretical explorations.