Dynamic non-market capabilities in developing countries: An exploratory study

Business executives are increasingly confronted with a non-market environment characterised by high levels of uncertainty. While dynamic capabilities and uncertainty are examined in business strategy contexts, few non-market strategy studies explicitly refer to them as a means of responding to uncertainty. This study employs an exploratory, qualitative methodology in our paper that examines the role played by dynamic capabilities deployed by executives in the management of non-market strategy. Our study makes three contributions to the extant literature. It builds exploratory theoretical and empirical linkages between dynamic capabilities and non-market strategy. It examines antecedents of dynamic non-market capabilities, and it explores three specific dynamic capabilities in a non-market context: ambidexterity, absorptive capacity, and continuous morphing. Using in-depth interviews with senior executives from developed and developing countries and employing deductive content analysis, we find the utilisation of dynamic non-market capabilities is prevalent in two cases: (a) when a manager’s professional experience has been in a developing country or (b) their life experience was in a developed country. Managers with life experience in a developed country have better formal understanding of dynamic capabilities than counterparts from developing countries. The paper concludes with implications for management and strategy.