Dynamic capabilities, ordinary capabilities and international intensity contributions to performance

Purpose Drawing on the resource-based view and dynamic-capabilities view, the purpose of this study is to investigate the influence of a firm’s ordinary and dynamic capabilities on performance. The study also explores the moderating effects of international intensity on the relationship between capabilities and performance. Design/methodology/approach The study used a data envelopment analysis and a generalized moments method to analyze secondary panel data collected from a sample of 164 manufacturing firms for nine years. Findings The findings reveal that a firm’s capabilities are a predictor of firm performance, dynamic capabilities strengthen the ordinary capabilities – performance relationships and international intensity positively moderates the capabilities – performance relationships. Research limitations/implications There is a need for more in-depth methods to capture dynamic capabilities and effects in an international context. Practical implications The findings reveal two practical implications for managers. First, to be successful, managers must make more efforts to maintain technological, marketing and financial capabilities, which are considered determinants of performance. Second, managers must invest even more to build a dynamic capability to ensure capabilities reconfiguration to effectively benefit from an internationalization strategy. Originality/value The study introduces many ordinary capabilities alongside dynamic ones as predictors of performance in the same theoretical model. The authors also examine the moderating influence of international intensity on the relationship between ordinary capabilities – dynamic capabilities – and performance.