Dynamic Capabilities and Performance in Low-Tech Manufacturing Industries: Examining the Roles of Innovative, Absorptive, and Adaptive Capabilities
DOI:
https://doi.org/10.5007/2175-8077.2026.e103117Keywords:
Dynamic Capabilities., Absorptive Capacity, Adaptive Capacity., Innovative Capacity., PerformanceAbstract
Purpose: This study examines the distinct effects of innovative, absorptive, and adaptive capabilities on organizational and innovative performance in low-tech manufacturing industries. While dynamic capabilities are generally associated with superior firm performance, less is known about how different dynamic capabilities contribute to performance outcomes in low-technology contexts. Design/ methodology: A survey was conducted with 41 Brazilian firms operating in the wood and furniture industries. Data were analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM). Findings: The results reveal a heterogeneous pattern of effects among dynamic capabilities. Innovative capability positively influenced market, financial, and innovative performance, emerging as the most influential capability across all performance dimensions. Absorptive capability positively affected market and financial performance but did not significantly influence innovative performance. Contrary to theoretical expectations, adaptive capability did not positively affect performance and exhibited negative relationships with market and financial performance. Theoretical contributions: Innovative, absorptive, and adaptive capabilities do not contribute equally to organizational outcomes in low-tech manufacturing industries. The findings suggest that the effectiveness of dynamic capabilities is context-dependent and that innovative capability represents the most strategically relevant capability in mature industrial environments characterized by lower technological intensity. Managerial implications: Managers of low-tech manufacturing firms should prioritize investments in innovative capability and, to a lesser extent, absorptive capability, as these capabilities generate the strongest organizational benefits. Also, adaptive initiatives should be carefully aligned with environmental demands, as adaptation alone may not necessarily translate into superior performance.
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