Paper info

Dynamic capabilities view for closing the capability gaps in business model’s transfer process: A case study of Japanese international retailer

Hajime Kobayashi and Yasuaki Saito

The paper was published at the 35th IMP-conference in Paris, France in 2019.

The firms are trying to close the capability gaps and (re)generate the business system locally, but there are differences (heterogeneity) among firms in this ability. This paper analyze how international firms (re) generate own business model for closing the ordinary capability gap caused by foreign expansion. There are many difficulties in (re)building own business model across borders, which hinder the adequate working of the ordinary (operational, substantive) capabilities that the company intends to perform globally. This paper refers to the breakdowns /malfunctions of ordinary capabilities (here after OC) as the capability gaps. Based on existing analysis, we classify two types of the capability gaps, replication (standardization) problem and adaptation problem. The first capability gap (replication problem) implies that we cannot do things rightly. While we try to transfer the best practices into foreign countries, we face the knowledge transfer problem. The second capability gap (adaptation problem) implies that we cannot do right things in foreign context. We must search out the best answer. This paper analyze how international firms rebuild own business model by solving the second capability gap as the adaptation problems. In doing so, we adopt IMP’s ARA dimensions and a dynamic capabilities view of the firms (hereafter DC). This research aims to clarify the dynamic transfer process of the retail business model focusing on the working of the three DC’s sub-capabilities. We conduct a qualitative case study by collecting and analyzing longitudinal data about a Japanese international retailer called Ito-Yokado. As a contribution of this paper, we have found several combined effects of DC’s sub-capabilities on the evolutionary process of retail business models within local business ecosystem.