<abstract xmlns="http://www.w3.org/1999/xhtml">

<sec><h3>Purpose</h3>
<p>The purpose of the study is to better understand the relationship between dynamic capabilities and firm competitive performance, and how innovation capabilities, specifically (a) product capability and (b) process capability, may play a mediating role in this relationship.</p>
</sec>
<sec><h3>Design/Methodology/Approach</h3>
<p>Simple Random Sampling technique was adopted to choose SMEs to collect data based on information obtained from Hungarian SMEs associations. A total of 565 completed questionnaires were obtained, with response rate of 65.50%. Confirmatory factor analysis (CFA) was used with AMOS 24 to assess the reliability and validity; and Cronbach’s alpha coefficient was additionally used to assess the dependability of the scales. The proposed model was put to the test using structured equation modelling (SEM).</p>
</sec>
<sec><h3>Results</h3>
<p>The study results show that dynamic capacities have a significant direct effect on innovation capabilities: product capability and process capability. The study also proves that both product capability and process capability have a significant impact on a firm’s competitive performance.</p>
</sec>
<sec><h3>Conclusion</h3>
<p>The study concludes that the relationship between dynamic capabilities and competitive firm performance is partially mediated by innovation capabilities. The study suggests that before enhancing product innovation capability, entrepreneurs should consider reorganizing and reallocating resources into process innovation capability. This study contributes to our understanding of the mediating mechanism of innovation capabilities through which dynamic capabilities enhance firm competitiveness performance.</p>
</sec>
</abstract>

Purpose
The purpose of the study is to better understand the relationship between dynamic capabilities and firm competitive performance, and how innovation capabilities, specifically (a) product capability and (b) process capability, may play a mediating role in this relationship.

Design/Methodology/Approach
Simple Random Sampling technique was adopted to choose SMEs to collect data based on information obtained from Hungarian SMEs associations. A total of 565 completed questionnaires were obtained, with response rate of 65.50%. Confirmatory factor analysis (CFA) was used with AMOS 24 to assess the reliability and validity; and Cronbach’s alpha coefficient was additionally used to assess the dependability of the scales. The proposed model was put to the test using structured equation modelling (SEM).

Results
The study results show that dynamic capacities have a significant direct effect on innovation capabilities: product capability and process capability. The study also proves that both product capability and process capability have a significant impact on a firm’s competitive performance.

Conclusion
The study concludes that the relationship between dynamic capabilities and competitive firm performance is partially mediated by innovation capabilities. The study suggests that before enhancing product innovation capability, entrepreneurs should consider reorganizing and reallocating resources into process innovation capability. This study contributes to our understanding of the mediating mechanism of innovation capabilities through which dynamic capabilities enhance firm competitiveness performance.

The Mediating Role of Innovation Capabilities on the Relationship between Dynamic Capabilities and Firm Competitive Performance

Organizacija

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

Purpose
The purpose of the study is to better understand the relationship between dynamic capabilities and firm competitive performance, and how innovation...

The Mediating Role of Innovation Capabilities on the Relationship between Dynamic Capabilities and Firm Competitive Performance

Published Online: Mar 04, 2024

Page range: 56 - 71

Received: Jan 16, 2023

Accepted: Aug 01, 2023

DOI: https://doi.org/10.2478/orga-2024-0004

Keywords
Innovation capabilities, Dynamic capabilities, Competitive firm performance, Technological innovations

© 2024 Mohanad Ali Kareem et al., published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

The Mediating Role of Innovation Capabilities on the Relationship between Dynamic Capabilities and Firm Competitive Performance

Published Online: Mar 04, 2024

Page range: 56 - 71

Received: Jan 16, 2023

Accepted: Aug 01, 2023

DOI: https://doi.org/10.2478/orga-2024-0004

KeywordsInnovation capabilities, Dynamic capabilities, Competitive firm performance, Technological innovations

© 2024 Mohanad Ali Kareem et al., published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

Keywords
Innovation capabilities, Dynamic capabilities, Competitive firm performance, Technological innovations