TY - GEN
T1 - A decision model for dynamic capabilities based on learning effects
AU - Wu, Xiaobo
AU - Xu, Songyi
AU - Hu, Songcui
PY - 2006
Y1 - 2006
N2 - The innovation-based competition becomes the mainstream in time of the new economy. Under this form of competition, conducts of rivals, changes of environments, or emergences of new technologies all can erode the heterogeneous competencies of the target company very quickly. There are two ways for companies to adapt to the changing environment, the ad hoc problem solving mode and the dynamic routine mode. This paper discussed how to choose the proper change mode by comparing their cost structures. We found that the slope of the cost curve of the dynamic routines would decline with the increase of the frequency of changes because of the learning effects. Moreover, every company has its special turning point based on the cost structure and learning efficiency. Then we deduced a equation to find such turning point, and discussed the methods to calculate the key parameters in the decision model and its typical uses under two special scenarios.
AB - The innovation-based competition becomes the mainstream in time of the new economy. Under this form of competition, conducts of rivals, changes of environments, or emergences of new technologies all can erode the heterogeneous competencies of the target company very quickly. There are two ways for companies to adapt to the changing environment, the ad hoc problem solving mode and the dynamic routine mode. This paper discussed how to choose the proper change mode by comparing their cost structures. We found that the slope of the cost curve of the dynamic routines would decline with the increase of the frequency of changes because of the learning effects. Moreover, every company has its special turning point based on the cost structure and learning efficiency. Then we deduced a equation to find such turning point, and discussed the methods to calculate the key parameters in the decision model and its typical uses under two special scenarios.
UR - http://www.scopus.com/inward/record.url?scp=34249738675&partnerID=8YFLogxK
UR - http://www.scopus.com/inward/citedby.url?scp=34249738675&partnerID=8YFLogxK
U2 - 10.1109/ICMIT.2006.262216
DO - 10.1109/ICMIT.2006.262216
M3 - Conference contribution
AN - SCOPUS:34249738675
SN - 1424401488
SN - 9781424401482
T3 - ICMIT 2006 Proceedings - 2006 IEEE International Conference on Management of Innovation and Technology
SP - 42
EP - 46
BT - ICMIT 2006 Proceedings - 2006 IEEE International Conference on Management of Innovation and Technology
T2 - 2006 IEEE International Conference on Management of Innovation and Technology, ICMIT 2006
Y2 - 21 June 2006 through 23 June 2006
ER -