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Innovation Capabilities: Affirming an Oxymoron?
Karl Joachim Breunig , Tor Helge Aas
The relationship between resources and capabilities and performance has
been discussed since Edith Penrose addressed the mechanisms behind
the growth of the firm (Penrose, 1959). Early contributions to this area of
research suggest that valuable and inimitable resources and capabilities are
the primary sources of superior performance and sustained competitive
advantage (Barney, 1991; Wernerfelt, 1984), while more recent contributions
suggest that the ability to change and re-configure resources and capabilities
(dynamic capabilities) are the most important for performance, especially
when the market is unstable (Teece, 2014; Teece, Pisano & Shuen, 1997).
It has also been argued that firms may utilize their resources and
capabilities through the development of innovations in the form of new
products, services or processes (Hill, Brandeau, Truelove & Lineback, 2015),
and empirical research has confirmed that there is a positive relationship
between the implementation of innovation activities and the future
performance of firms (Bowen, Rostami & Steel, 2010; Rubera & Kirca,
2012). However, innovation as a phenomenon entails change, as opposed
to resources and capabilities that represents a firm’s ability to reproduce a
certain performance – and as such involves stability. Viewed in this way the
very term innovation capability can constitute an oxymoron.
The study of innovation capabilities is therefore a complex field of study
that is emerging. The topic has already attracted interest from a number of
scholars (e.g. Forsman, 2011; Guan & Ma, 2003; Hertog, van der Aa & de
Jong, 2010; Wang, Lu & Chen, 2008; Yam, Lo, Tang & Lau, 2011), but despite
these important advances there is still a lack of consensus in the literature
and a pressing need to clarify what type of resources and capabilities drive
innovation in different contexts (Lidija & Robert, 2014), and how these
capabilities are developed and utilized (Helfat & Peteraf, 2003).
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