Although research has shown that business model innovation (BMI) is an effective means to remain competitive in the digital age, many firms do not respond appropriately and often fail to exploit new digital opportunities. In this study, we adopt a microfoundational approach to understand the role and effects of dynamic capabilities (DCs) on BMI in the context of digitalization. Furthermore, we test how this relationship is influenced by contextual factors. Our results from a survey of German manufacturing firms demonstrate the importance of building strong DCs for effective BMI in the context of digitalization. We also highlight the advantages of an entrepreneurial leadership and mindset in this context. The study further suggests that environmental turbulence in the digital context acts as an antecedent to DCs and BMI, rather than moderating their relationship. While strategic factors indirectly affect BMI as antecedents of DCs, we found no evidence of an influence of the organizational structure.

The manner in which technological capability and marketing capability can besuccessfully leveraged is an important research issue. Based on theresource-management model, this study aims to answer two research questions:(1) whether technological capability and marketing capability arecomplementary or supplementary capabilities; and (2) how technologicalcapability and marketing capability can be used appropriately to respond toenvironmental turbulence. Based on a face-to-face interview survey of 212Chinese firms, we find that technological capability and marketingcapability have synergistic effects. We also find that technologicalturbulence enhances the performance effect of technological capability, butimpedes that of marketing capability; whereas market turbulence advances theperformance effect of marketing capability, but impedes that oftechnological capability. Thus, the appropriate way to leveragetechnological capability and marketing capability is to integrate them andto deploy technological capability to respond to technological turbulenceand marketing capability to respond to market turbulence.