Abstract
This study explores how start-ups manage high-turbulent markets during the first six-months of the COVID-19 pandemic, and how dynamic capabilities are operationalized in that situation. A multiple-case study approach was employed to investigate eight start-up cases in Indonesia. Indonesia was chosen to represent an emerging economy with a tremendous growing number of start-ups. The data are presented based on the evolving circumstances of the COVID-19 crisis. The research findings illustrate how dynamic capabilities are operationalized simultaneously with the validation of adjusted business models through simple-experiential routines, iterative executions, and action-oriented processes amidst the high-turbulent markets. Dynamic capabilities that operate in full combination by sensing, seizing, and transforming capabilities potentially can facilitate the creation of values for firms faster than otherwise. This study also identifies specific elements and alignment mechanisms incorporated in the dynamic capabilities.
References
Agarwal, R., A. Santoso, K. T. Tan, and P. Wibowo. 2021. “Ten Ideas to Unlock Indonesia’s Growth after COVID-19”. McKinsey. May 3. https://www.mckinsey.com/featured-insights/asia-pacific/ten-ideas-to-unlock-indonesias-growth-after-covid-19 (Accessed October 3, 2021).Search in Google Scholar
Alvarez, S., and L. W. Busenitz. 2001. “The Entrepreneurship of Resource-Based Theory.” Journal of Management 27 (6): 755–75. https://doi.org/10.1177/014920630102700609.Search in Google Scholar
Ambrosini, V., and C. Bowman. 2009. “What Are Dynamic Capabilities and Are They a Useful Construct in Strategic Management?” International Journal of Management Reviews 11 (1): 29–49. https://doi.org/10.1111/j.1468-2370.2008.00251.x.Search in Google Scholar
Argote, L. 1999. Organizational Learning: Creating, Retaining, and Transferring Knowledge. Boston: Kluwer Academic.Search in Google Scholar
Aulet, B. 2013. Disciplined Entrepreneurship: 24 Steps to a Successful Startup. Hoboken: John Wiley & Sons.Search in Google Scholar
Baker, T., and R. E. Nelson. 2005. “Creating Something from Nothing: Resource Construction through Entrepreneurial Bricolage.” Administrative Science Quarterly 50 (3): 329–66. https://doi.org/10.2189/asqu.2005.50.3.329.Search in Google Scholar
Barreto, I. 2009. “Dynamic Capabilities: A Review of Past Research and an Agenda for the Future.” Journal of Management 36 (1): 256–80. https://doi.org/10.1177/0149206309350776.Search in Google Scholar
Berends, H., M. Jelinek, I. Reymen, and R. Stultiëns. 2014. “Product Innovation Processes in Small Firms: Combining Entrepreneurial Effectuation and Managerial Causation.” Journal of Product Innovation Management 31 (3): 616–35. https://doi.org/10.1111/jpim.12117.Search in Google Scholar
Blank, S. 2013. “Why the Lean Start-Up Changes Everything.” Harvard Business Review 91 (5): 63–72.Search in Google Scholar
Bryman, A., and B. Burgess. 2002. Analyzing Qualitative Data. London: Routledge.10.4324/9780203413081Search in Google Scholar
Burns, P. 2016. Entrepreneurship and Small Business, 4th ed. London: Palgrave Macmillan Limited.10.1007/978-1-137-43034-2Search in Google Scholar
Carland, J. 2015. “Seeing What’s Not There: The Enigma of Entrepreneurship.” Journal of Small Business Strategy 7 (1): 1–20.Search in Google Scholar
Chaparro, X. A. F., and L. A. V. Gomes. 2021. “Pivot Decisions in Startups: A Systematic Literature Review.” International Journal of Entrepreneurial Behavior & Research. Advance online publication 27 (4): 884-910, https://doi.org/10.1108/ijebr-12-2019-0699.Search in Google Scholar
Doern, R., N. Williams, and T. Vorley. 2019. “Special Issue on Entrepreneurship and Crises: Business as Usual? An Introduction and Review of the Literature.” Entrepreneurship & Regional Development 31: 400–12. https://doi.org/10.1080/08985626.2018.1541590.Search in Google Scholar
Eisenhardt, K. M. 1989. “Building Theories from Case Study Research.” Academy of Management Review 14 (4): 532–50. https://doi.org/10.5465/amr.1989.4308385.Search in Google Scholar
Eisenhardt, K. M., and M. E. Graebner. 2007. “Theory Building from Cases: Opportunities and Challenges.” Academy of Management Journal 50 (1): 25–32. https://doi.org/10.5465/amj.2007.24160888.Search in Google Scholar
Eisenhardt, K. M., and J. A. Martin. 2000. “Dynamic Capabilities: What Are They?” Strategic Management Journal 21: 1105–21. https://doi.org/10.1002/1097-0266(200010/11)21:10/11<1105::aid-smj133>3.0.co;2-e.10.1002/1097-0266(200010/11)21:10/11<1105::AID-SMJ133>3.0.CO;2-ESearch in Google Scholar
Enkel, E., and V. Sagmeister. 2020. “External Corporate Venturing Modes as New Way to Develop Dynamic Capabilities.” Technovation 96–97: 1–14. https://doi.org/10.1016/j.technovation.2020.102128.Search in Google Scholar
Feng, N., C. Fu, F. Wei, Z. Peng, Q. Zhang, and K. H. Zhang. 2019. “The Key Role of Dynamic Capabilities in the Evolutionary Process for a Startup to Develop into an Innovation Ecosystem Leader: An Indepth Case Study.” Journal of Engineering and Technology Management 54: 81–96. https://doi.org/10.1016/j.jengtecman.2019.11.002.Search in Google Scholar
Foss, N. J., and P. G. Klein. 2017. “Entrepreneurial Discovery or Creation? In Search of the Middle Ground.” Academy of Management Review 42 (4): 733–6. https://doi.org/10.5465/amr.2016.0046.Search in Google Scholar
Freeman, J., and J. S. Engel. 2007. “California Management Models of Innovation: Startups and Mature Corporations.” California Management Review 50 (1): 94–119. https://doi.org/10.2307/41166418.Search in Google Scholar
Gibbert, M., W. Ruigrok, and B. Wicki. 2008. “What Passes as a Rigorous Case Study?” Strategic Management Journal 29 (13): 1465–74. https://doi.org/10.1002/smj.722.Search in Google Scholar
Glaser, B. G., and A. L. Strauss. 1967. The Discovery of Grounded Theory: Strategies for Qualitative Research. New York: Aldine De Gruyter.10.1097/00006199-196807000-00014Search in Google Scholar
Hamel, G., and L. Valikangas. 2003. “The Quest for Resilience.” Harvard Business Review 81: 52–63.Search in Google Scholar
Hanchi, S. E., and L. Kerzazi. 2020. “Startup Innovation Capability from a Dynamic Capability-Based View: A Literature Review and Conceptual Framework.” Journal of Small Business Strategy 30 (2): 72–92.Search in Google Scholar
Helfat, C. E. 1997. “Know-How and Asset Complementary and Dynamic Capability Accumulation: The Case of R & D.” Strategic Management Journal 18: 339–60, https://doi.org/10.1002/(SICI)1097-0266(199705)18:5%3C339::AID-SMJ883%3E3.0.CO;2-7.10.1002/(SICI)1097-0266(199705)18:5<339::AID-SMJ883>3.0.CO;2-7Search in Google Scholar
Helfat, C. E., S. Finkelstein, W. Mitchell, M. Peteraf, H. Singh, D. Teece, and S. Winter. 2007. Dynamic Capabilities: Understanding Strategic Change in Organizations. Singapore: Blackwell Publishing.Search in Google Scholar
Helfat, C. E., and M. A. Peteraf. 2009. “Understanding Dynamic Capabilities: Progress along a Developmental Path.” Strategic Organization 7 (1): 91–102. https://doi.org/10.1177/1476127008100133.Search in Google Scholar
Ho, T. H., and C. S. Tang. 2004. “Introduction to the Special Issue on Marketing and Operations Management Interfaces and Coordination.” Management Science 50 (4): 429–30. https://doi.org/10.1287/mnsc.1030.0171.Search in Google Scholar
Irwin, K. C., C. M. Gilstrap, P. L. Drnevich, and C. M. Tudor. 2019. “From Start-Up to Acquisition: Implications of Financial Investment Trends for Small- to Medium-Sized High-Tech Enterprises.” Journal of Small Business Strategy 29 (2): 22–43.Search in Google Scholar
Korber, S., and R. B. McNaughton. 2018. “Resilience and Entrepreneurship: A Systematic Literature Review.” International Journal of Entrepreneurial Behavior & Research 24: 1129–54. https://doi.org/10.1108/IJEBR-10-2016-0356.Search in Google Scholar
Kost, D. 2020. “COVID Not Slowing VC Investment”. Harvard Business School Working Knowledge. https://hbswk.hbs.edu/item/covid-not-slowing-vc-investment (Accessed September 25, 2021).Search in Google Scholar
Kuckertz, A., L. Brändle, A. Gaudig, S. Hinderer, C. Arturo Morales Reyes, A. Prochotta, K. M. Steinbrink, and E. S. Berger. 2020. “Startups in Times of Crisis—A Rapid Response to the COVID-19 Pandemic.” Journal of Business Venturing Insights e00169. https://doi.org/10.1016/j.jbvi.2020.e00169.Search in Google Scholar
Leih, S., Linden, G., and Teece, D. 2015. Business Model Innovation and Organizational Design. In Business Model Innovation. UC Berkeley Previously Published Works. Also available at https://escholarship.org/uc/item/49x3z5jj.10.1093/acprof:oso/9780198701873.003.0002Search in Google Scholar
Ma, H., C. Lang, Q. Sun, and D. Singh. 2021. “Capability Development in Startup and Mature Enterprises.” Management Decision 59 (6): 1442–61. 10.1108/MD-03-2020-0313.10.1108/MD-03-2020-0313Search in Google Scholar
Martinelli, E., G. Tagliazucchi, and G. Marchi. 2018. “The Resilient Retail Entrepreneur: Dynamic Capabilities for Facing Natural Disasters.” International Journal of Entrepreneurial Behavior & Research 24: 1222–43. https://doi.org/10.1108/ijebr-11-2016-0386.Search in Google Scholar
McKelvie, A., and P. Davidsson. 2009. “From Resource Base to Dynamic Capabilities: An Investigation of New Firms.” British Journal of Management 20: S63–80. https://doi.org/10.1111/j.1467-8551.2008.00613.x.Search in Google Scholar
Miles, M. B., and A. M. Huberman. 1994. An Expanded Sourcebook, Qualitative Data Analysis. California: SAGE Publications.Search in Google Scholar
Montealegre, R. 2002. “A Process Model of Capability Development: Lessons from the Electronic Commerce Strategy at Bolsa de Valores de Guayaquil.” Organization Science 13 (5): 514–31. https://doi.org/10.1287/orsc.13.5.514.7808.Search in Google Scholar
Murphy, G., N. Tocher, and T. Burch. 2019. “Small Business Owner Persistence: Do Personal Characteristics Matter?” Journal of Small Business Strategy 29 (1): 99–114.Search in Google Scholar
O’Toole, J., Y. Gong, T. Baker, D. T. Easley, and A. S. Miner. 2020. “Startup Responses to Unexpected Events: The Impact of the Relative Presence of Improvisation.” Organization Studies 1 (25). https://doi.org/10.1177/0170840620937859.Search in Google Scholar
Pavlou, P. A., and O. A. El Sawy. 2010. “The “Third Hand”: IT-Enabled Competitive Advantage in Turbulence through Improvisational Capabilities.” Information Systems Research 21 (3): 443–71. https://doi.org/10.1287/isre.1100.0280.Search in Google Scholar
Penrose, E. T. 1959. The Theory of the Growth of the Firm. New York: John Wiley.Search in Google Scholar
Pentland, B. T. 1999. “Building Process Theory with Narrative: From Description to Explanation.” Academy of Management Review 24 (4): 711–24. https://doi.org/10.5465/amr.1999.2553249.Search in Google Scholar
Rindova, V., and S. Taylor. 2002. “Dynamic Capabilities as Macro and Micro Organizational Evolution.” Robert H. Smith School of Business-Smith Papers Online 1 (11): 1–11.Search in Google Scholar
Rui, Z., and X. Ma. 2020. “The Contingent Effects of New Venture’s Improvisational Capability and Ambidextrous Search.” IEEE Transactions on Engineering Management 69 (5): 2349–60, https://doi.org/10.1109/tem.2020.3012035.Search in Google Scholar
Saunders, M., D. Lewis, and A. Thornhill. 2015. Research Methods for Business Students. Essex: Pearson International Content.Search in Google Scholar
Strauss, A., and J. Corbin. 1990. Basics of Qualitative Research, Grounded Theory Procedures and Techniques. London: SAGE Publications.Search in Google Scholar
Teece, D. J. 2007. “Explicating Dynamic Capabilities: The Nature and Microfoundations of (Sustainable) Enterprise Performance.” Strategic Management Journal 28 (13): 1319–50. https://doi.org/10.1002/smj.640.Search in Google Scholar
Teece, D. J. 2010. “Business Models, Business Strategy and Innovation.” Long Range Planning 43 (2–3): 172–94. https://doi.org/10.1016/j.lrp.2009.07.003.Search in Google Scholar
Teece, D. J. 2012. “Dynamic Capabilities: Routines versus Entrepreneurial Action.” Journal of Management Studies 49: 1395–401. https://doi.org/10.1111/j.1467-6486.2012.01080.x.Search in Google Scholar
Teece, D. J. 2018. “Business Models and Dynamic Capabilities.” Long Range Planning 51 (1): 40–9. https://doi.org/10.1016/j.lrp.2017.06.007.Search in Google Scholar
Teece, D. J., G. Pisano, and A. Shuen. 1997. “Dynamic Capabilities and Strategic Management.” Strategic Management Journal 18 (7): 509–33. https://doi.org/10.1002/(sici)1097-0266(199708)18:7<509::aid-smj882>3.0.co;2-z.10.1002/(SICI)1097-0266(199708)18:7<509::AID-SMJ882>3.0.CO;2-ZSearch in Google Scholar
Van de Ven, A. H., and M. S. Poole. 2005. “Alternative Approaches for Studying Organizational Change.” Organization Studies 26 (9): 1377–404. https://doi.org/10.1177/0170840605056907.Search in Google Scholar
Velu, C. 2015. “Business Model Innovation and Third-Party Alliance on the Survival of New Firms.” Technovation 35: 1–11. https://doi.org/10.1016/j.technovation.2014.09.007.Search in Google Scholar
Wang, D., E. C. Pahnke, and R. M. McDonald. 2022. “The Past Is Prologue? Venture-Capital Syndicates’ Collaborative Experience and Start-Up Exits.” Academy of Management Journal 65 (2): 371–402. https://doi.org/10.5465/amj.2019.1312.Search in Google Scholar
Williams, T. A., D. A. Gruber, K. M. Sutcliffe, D. A. Shepherd, and E. Y. Zhao. 2017. “Organizational Response to Adversity: Fusing Crisis Management and Resilience Research Streams.” The Academy of Management Annals 11: 733–69. https://doi.org/10.5465/annals.2015.0134.Search in Google Scholar
Winter, S. G. 2003. “Understanding Dynamic Capabilities.” Strategic Management Journal 24: 991–5. https://doi.org/10.1002/smj.318.Search in Google Scholar
Yin, R. K. 2009. Case Study Research, Design, and Methods. California: SAGE Publications, Inc.Search in Google Scholar
Zahra, S. A., H. J. Sapienza, and P. Davidsson. 2006. “Entrepreneurship and Dynamic Capabilities: A Review, Model and Research Agenda.” Journal of Management Studies 43 (4): 917–55. https://doi.org/10.1111/j.1467-6486.2006.00616.x.Search in Google Scholar
Zollo, M., and S. G. Winter. 2002. “Deliberate Learning and the Evolution of Dynamic Capabilities.” Organization Science 13 (3): 339–51. https://doi.org/10.1287/orsc.13.3.339.2780.Search in Google Scholar
Zott, C., and R. Amit. 2008. “The Fit between Product Market Strategy and Business Model: Implications for Firm Performance.” Strategic Management Journal 29 (1): 1–26. https://doi.org/10.1002/smj.642.Search in Google Scholar
© 2023 Walter de Gruyter GmbH, Berlin/Boston
Articles in the same Issue
- Frontmatter
- Competitive Research Articles
- Impact of Entrepreneurial Orientation on MSME Performance: Mediating Role of Entrepreneurial Competency
- The Development of Corporate Entrepreneurship among Emerging Economy SMEs: Insights from Both Institutional and Contingency Theory
- The Dynamic Capabilities of High-Turbulent Markets: Indonesian Start-Up Cases During COVID-19 Pandemic
- Entrepreneurship, Resource Rents and Institutions
- The Scaling Strategies and the Scaling Performance of Chinese Social Enterprises: The Moderating Role of Organizational Resources
- Research on Corporate Entrepreneurship in Developing Countries: A Review and Agenda for Future Directions
- The Impact of Initial Intellectual Property Decisions of Start-Ups on Innovation Performance
- Social Capital and Innovative Performance in Networks: The Journey of Romanian SaaS Entrepreneurs
- Gender Differences in the use of Social Capital for Entrepreneurial Activity Within Contexts of Poverty
- Commitment Helps: The Positive Effects of Long-Term Orientation and Family Ownership on Firms’ International Expansion
- Institutional Environment, Executive Equity Incentive, and Enterprise Innovation: The Case of China
- Determinants of Entrepreneurial Employee Activity in Saudi Arabia
- How Does Entrepreneurial Role Model Connect to Entrepreneurial Perceptions: The Moderating Role of Psychological Distance
- The Influence of Top Management’s Strategic Planning Capacity and Entrepreneurial Orientation on Corporate Entrepreneurship
- Innovation Ambidexterity and Firm Performance: The Moderating Effects of Contextual Factors
Articles in the same Issue
- Frontmatter
- Competitive Research Articles
- Impact of Entrepreneurial Orientation on MSME Performance: Mediating Role of Entrepreneurial Competency
- The Development of Corporate Entrepreneurship among Emerging Economy SMEs: Insights from Both Institutional and Contingency Theory
- The Dynamic Capabilities of High-Turbulent Markets: Indonesian Start-Up Cases During COVID-19 Pandemic
- Entrepreneurship, Resource Rents and Institutions
- The Scaling Strategies and the Scaling Performance of Chinese Social Enterprises: The Moderating Role of Organizational Resources
- Research on Corporate Entrepreneurship in Developing Countries: A Review and Agenda for Future Directions
- The Impact of Initial Intellectual Property Decisions of Start-Ups on Innovation Performance
- Social Capital and Innovative Performance in Networks: The Journey of Romanian SaaS Entrepreneurs
- Gender Differences in the use of Social Capital for Entrepreneurial Activity Within Contexts of Poverty
- Commitment Helps: The Positive Effects of Long-Term Orientation and Family Ownership on Firms’ International Expansion
- Institutional Environment, Executive Equity Incentive, and Enterprise Innovation: The Case of China
- Determinants of Entrepreneurial Employee Activity in Saudi Arabia
- How Does Entrepreneurial Role Model Connect to Entrepreneurial Perceptions: The Moderating Role of Psychological Distance
- The Influence of Top Management’s Strategic Planning Capacity and Entrepreneurial Orientation on Corporate Entrepreneurship
- Innovation Ambidexterity and Firm Performance: The Moderating Effects of Contextual Factors