DYNAMIC CAPABILITIES IN NEW PRODUCT DEVELOPMENT AND ITS EFFECTS ON FIRM PERFORMANCE

Abstract

Achieving a sustainable competitive advantage through supply chains (SC) leads to a company being able to generate an economic surplus into the future (Teece, 2007). Prior studies have highlighted that developing organisational capabilities are a means by which this sustainable competitive advantage can be realised (Grant, 1996). In particular, dynamic capabilities (DC), which are considered as higher order organisational capabilities, are necessary for the manufacturing companies to enhance new product development (NPD) performance in a competitive business environment. This study aims to measure the three main interrelated capacities of the DC model (Teece, 2007), namely: sensing capacity, seizing capacity and reconfiguration capacity, with respect to the micro-foundations which include organisational and managerial process for the improving NPD performance, more accurately. The multi-dimensional and replicable DC and NPD performance assessment frameworks have been developed, validated and tested on selected appropriate cases including, Cummins, Rolls Royce, Nissan, Jaguar Land Rover and LAM Research in order to help senior managers to make robust decisions in both volatile and stable business environments, and also to identify the areas of strength and weakness through sensitivity analysis. The Multiple Criteria Decision Analysis (MCDA) through Evidential Reasoning (ER) approach deployed the Intelligent Decision System (IDS) software tool which has been applied to perform self-performance assessment of the manufacturing companies on DC and NPD performance. The study has also made an important theoretical contribution to the existing literature by being one of the first studies to explore the complex inter-relationships between DC and NPD performance using a MCDA approach. The results show the positive effects of sensing capacity, seizing capacity and reconfiguration capacity on NPD effectiveness, NPD efficiency for the most scattered data points. The positive NPD performance effects of seizing capacity and reconfiguration capacity are slightly more significant than sensing capacity. There are also positive effects of aforementioned capacities on product content. The results are comparable and consistent with previous empirical studies and qualitative judgement of case study with some new contribution to the exiting literature. Additionally, the areas of improvement that need to be more focused upon are the search for new technology, intern-organisation communication, building trust, governance mechanism and autonomy, NPD efficiency and product content.

Date of Award	1 Aug 2018
Original language	English
Awarding Institution	The University of Manchester
Supervisor	Jian-Bo Yang (Supervisor) & Stephen Eldridge (Supervisor)