The Development of the DDG-Capability in Firms: An Evaluation of Its Impact on Firm Financial Performance

We examine whether firms that develop the Digital Data Genesis dynamic capability show higher performance. Using detailed survey data on the capabilities developed by companies by the usage of digital data and firm financial performance of 96 firms, we find that the firms that develop the DDG dynamic capability have levels of ROA, ROS and revenue growth higher than others do. Our results provide one of the first empirical evidence on the direct link between DDG dynamic capability and firm financial performance

[1]  D. Teece,et al.  DYNAMIC CAPABILITIES AND STRATEGIC MANAGEMENT , 1997 .

[2]  Kathleen M. Eisenhardt,et al.  DYNAMIC CAPABILITIES, WHAT ARE THEY? , 2000 .

[3]  S. Winter,et al.  Introduction: The Nature and Dynamics of Organizational Capabilities , 2001 .

[4]  William J. Kettinger,et al.  Information Orientation: The Link to Business Performance , 2001 .

[5]  Michael L. Williams,et al.  Identifying the Organizational Routines in NEBIC Theory's Choosing Capability , 2002 .

[6]  Gongming Qian,et al.  Profitability of small‐ and medium‐sized enterprises in high‐tech industries: the case of the biotechnology industry , 2003 .

[7]  Shuming Zhao,et al.  The Effect of Export Marketing Capabilities on Export Performance: An Investigation of Chinese Exporters , 2003 .

[8]  Varun Grover,et al.  Shaping Agility through Digital Options: Reconceptualizing the Role of Information Technology in Contemporary Firms , 2003, MIS Q..

[9]  Paul A. Pavlou,et al.  From IT Leveraging Competence to Competitive Advantage in Turbulent Environments: The Case of New Product Development , 2006, Inf. Syst. Res..

[10]  Shu Lin,et al.  Plant Information Systems, Manufacturing Capabilities, and Plant Performance , 2006, MIS Q..

[11]  Varun Grover,et al.  Business Value of IT: An Essay on Expanding Research Directions to Keep up with the Times , 2008, J. Assoc. Inf. Syst..

[12]  Richard T. Watson,et al.  MIS Profit from Customer Data by Identifying Strategic Opportunities Profit from Customer Data by Identifying Strategic Opportunities and Adopting the "Born Digital" Approach and Adopting the "Born Digital" Approach , 2008 .

[13]  Paul P. Tallon.  Inside the adaptive enterprise: an information technology capabilities perspective on business process agility , 2008, Inf. Technol. Manag..

[14]  P. Drnevich,et al.  Clarifying the conditions and limits of the contributions of ordinary and dynamic capabilities to relative firm performance , 2011 .

[15]  Narayan Ramasubbu,et al.  How Information Management Capability Influences Firm Performance , 2011, MIS Q..

[16]  Margaret A. Peteraf,et al.  The elephant in the room of Dynamic Capabilities: Bringing two diverging conversations together , 2012 .