Organization Improvisational Capabilities and Configurations of firm Performance in a Highly Turbulent Environment

Abstract

This dissertation intends to examine 1) nature of organization improvisational capabilities and 2) some possible configurations for firm performance in a highly turbulent environment, i.e., e-commerce. Motivated by the observation of the dynamics of digital business ecosystem and to answer calls from IS, strategy and management fields, the first research question is to examine an organizational level capability that organizations use to respond to unexpected problems and turbulences. To gain understanding of organization improvisational capabilities, a scale development project was conducted. An essential goal of scale development is to create a valid measure of an underlying construct. . A thorough literature review of improvisation and organization improvisational capabilities was completed. A definition of organization improvisational capabilities is formed to provide some basic and direct information for scholars and managers. One of the results of this review was the discovery of dimensions of improvisational capabilities that helped drive the development of a measurement scale for this latent construct. A robust measure of improvisational capabilities is developed and empirically tested. The result from the OIC scale development plays an important part for the second research question, which is to explore some possible combinations of elements for firm performance. Based on empirical field data, this dissertation sets out to investigate possible configurations for high firm financial performance involving organizational improvisational capabilities, IT infrastructure flexibility, particular organizational characteristics, and environmental factors and their relationships with innovation performance using the configurational approach and used fsQCA as the analysis tool. Instead of testing individual independent variable's effect like in linear path model, this dissertation applied configuration theory as the inquiring systems to show a more holistic view of the increasingly complex inter-relationships of elements of digital ecodynamics. Four different configurations for high financial performance of different firm sizes and IT department sizes were identified and discussed. This dissertation is one of the earliest IS studies applying configuration logic and set-theoretic methods, like fsQCA, in organization research and responds to calls in the innovation literature. This dissertation also makes a broader methodological contribution to organization and IS strategy researches in general. Existing theories that are based on linear, additive relationships between elements and assume equilibrium status cannot effectively explain such dynamically changing punctuated disequilibrium in digital ecodynamics (Meyer et al., 2005). A configurational approach accompanied by strong methods such as fsQCA can be used to build new theories that can effectively explain such nonlinear discontinuous changes driven by dynamic interactions of digital technologies, organizational and social factors.