Competitive Environment

Purpose – The aim of this paper is to study empirically the influence of managerial perceptions of the environment on dynamic capabilities generation. We identify three dimensions of competitive environment (dynamism, complexity and munificence) and then use the theoretical model developed by Zollo and Winter (2002) to explain dynamic capabilities creation.
Design/methodology/approach – We use data collected from 200 Spanish firms through a questionnaire to perform multiple and simple regression analyses that examines the relationship between managerial perceptions and dynamic capabilities generation.
Findings – We achieve the following results: 1) Managerial perception of munificence in the environment is related positively and significantly to the processes of dynamic capabilities creation. 2) Only when managers perceive the environment as highly dynamic and complex do they promote processes for developing dynamic capabilities.
Practical implications – The findings suggest that managerial cognition plays an important role in dynamic capabilities processes. Thus, managers should evaluate their mental models and value systems to determine whether they provide an accurate understanding of the environment.
Originality/value – Our understanding of dynamic capabilities must be developed though empirical papers, as unresolved theoretical inconsistencies create many challenges in this area. The proliferation of theoretical papers has produced a disconnected body of research.
Keywords dynamic capabilities, managerial cognition, dynamism, complexity, munificence, organizational learning.
Paper type  Research paper