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Abstract
Ordinary capabilities contribute to firm core competencies and are prominent drivers of firm performance. However, our understanding of ordinary capabilities, and how they are leveraged to advance performance in small and medium‐sized enterprises (SMEs), remains unclear. We review prior literature and introduce the Customer‐Alignment‐Operational (CAO) model of ordinary capabilities, which identifies three types of ordinary capabilities: customer, alignment, and operational capabilities. Using data collected from software industry SMEs, we find that CAO capabilities are configured in previously undiscovered ways to enhance firm performance. The findings advance our understanding of ordinary capability types and offer insight into how ordinary capabilities are configured to generate firm value.
*The authors wish to thank Jim Chrisman for his feedback and contribution to the study. Divesh Ojha, Nolan Gaffney, William Carter, and Lisa Dicke are acknowledged for their insightful comments and suggestions on earlier versions of this manuscript. We are also grateful to Daniel T. Holt and Staci M. Zavattaro for conversations that improved the quality of the study. Additionally, Xueni (Judy) Dong is appreciated for research assistance. Portions of this research were funded by the Department of Management at the University of North Texas.
*The authors wish to thank Jim Chrisman for his feedback and contribution to the study. Divesh Ojha, Nolan Gaffney, William Carter, and Lisa Dicke are acknowledged for their insightful comments and suggestions on earlier versions of this manuscript. We are also grateful to Daniel T. Holt and Staci M. Zavattaro for conversations that improved the quality of the study. Additionally, Xueni (Judy) Dong is appreciated for research assistance. Portions of this research were funded by the Department of Management at the University of North Texas.
Notes
*The authors wish to thank Jim Chrisman for his feedback and contribution to the study. Divesh Ojha, Nolan Gaffney, William Carter, and Lisa Dicke are acknowledged for their insightful comments and suggestions on earlier versions of this manuscript. We are also grateful to Daniel T. Holt and Staci M. Zavattaro for conversations that improved the quality of the study. Additionally, Xueni (Judy) Dong is appreciated for research assistance. Portions of this research were funded by the Department of Management at the University of North Texas.
1 According to Marcus and Anderson (Citation2006, p. 22), “Capabilities represent the system's separate components, while competencies represent its realized wholes. Capabilities suggest potential, while competencies connote achieved proficiencies.” Further, capabilities are rooted in firm processes and routines, while competencies tend to be centered on technical expertise (Marino Citation1996; Walsh et al. Citation2005).
2 Terms applied in the search string include: core capability, organizational capability, firm capability, ordinary capability, zero‐order capability, core competency, organizational competency, firm competency, ordinary competency, zero‐order competency, capability, and capabilities.
3 The term “customer” is used to represent any significant stakeholder of the firm.
4 Adapted from Jayachandran, Hewen, and Kaufman (Citation2004).
5 Adapted from Liao, Fei, and Chen (2007).
6 Adapted from Wu, Melnyk, and Flynn (2010).
Additional information
Notes on contributors
Joshua J. Daspit
Joshua J. Daspit is an Assistant Professor of Management at the Department of Management and Information Systems, Mississippi State University.
Derrick E. D'souza
Derrick E. D'Souza is a Professor of Management at the Department of Management, University of North Texas.