On micro-foundations of dynamic capabilities: A multi-level perspective based on CEO personality and knowledge-based capital

By David Bendig, Steffen Strese, Tessa Flatten, Maika Eva Susanne da Costa, Malte Brettel. Long range planning, 2017

110 citations recorded by the source corpus.

Abstract In recent years, researchers have asked why some firms are better than others at developing dynamic capabilities. The existing literature assesses micro-foundations separately, either on the managerial or on the organizational level. This study aims to provide a more holistic picture on the antecedents of dynamic capabilities by integrating managerial and organizational micro-foundations. Specifically, we posit that the personality of Chief Executive Officers (CEOs), manifested through their core self-evaluation (CSE), represents an individual-level micro-foundation which influences three types of a firm's knowledge-based capital—human, social, and organizational capital. We also argue that these three, in turn, are organization-level micro-foundations that ultimately enable the development of a firm's dynamic capabilities. We test our multi-level framework using data from 307 German CEOs, and confirm that CEO CSE is positively related with all three forms of knowledge-based capital. We further find that human capital and organizational capital mediate the relationship between a CEO's CSE and a firm's dynamic capabilities. Our research contributes by extending a central framework of the micro-foundations project (the bathtub model) that integrates the upper echelons perspective into a multi-level analysis. We empirically validate this model and advance the understanding of how firm leaders indirectly influence firm dynamic capabilities by shaping individual learning conditions.

Subfields: Accounting, Strategy and Management

View Paper: https://www.semanticscholar.org/paper/929cf6dc18c5a3d5db02205cb741deae1596d0a7

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