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The role of global dynamic managerial capability in the pursuit of international strategy and superior performance

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Abstract

We develop the construct of global dynamic managerial capability (GDMC) and identify its underlying sources: (1) international human capital, (2) international social capital, and (3) international managerial cognitions. Consistent with dynamic capabilities view and upper echelons theory, we suggest that GDMC leads to global asset orchestration, which in turn, results in superior company performance in a two-stage process. First, GDMC leads companies to adopt global strategies that spread the risk of internationalizations across different entry modes and geographic regions. Second, the (re)configuration of global assets positively influences subsequent firm performance and thus mediates the relationship between GDMC and performance. Recognizing the triad of factors that form global dynamic managerial capability is crucial when selecting future managers of multinational corporations. Hence, firms with increasing international exposure – both domestically via foreign competition and internationally via foreign market presence – may seek to compose their upper echelons with a suitable combination of international human and social capital as well as internationally diverse cognitions in the pursuit of sustained competitive advantage.

Resume

Nous développons la construction de la capacité de gestion dynamique globale (CGDG) et identifions ses sources sous-jacentes : (1) le capital humain international, (2) le capital social international, et (3) les connaissances managériales internationales. Conformément à l’approche des capacités dynamiques (ACD) et à la théorie des échelons hiérarchiques supérieurs (TES), nous suggérons que la CGDG mène à une orchestration mondiale des actifs, qui à son tour, entraîne une performance supérieure de l’entreprise dans un processus en deux étapes. Premièrement, la CGDG amène les entreprises à adopter des stratégies mondiales qui répartissent le risque d’internationalisation entre différents modes d’entrée et différentes régions géographiques. Deuxièmement, la (re)configuration des actifs mondiaux influence positivement les performances ultérieures de l’entreprise et, par conséquent, sert de médiateur entre la CGDG et les performances. La reconnaissance de la triade de facteurs qui forment la capacité de gestion dynamique globale est cruciale lors de la sélection des futurs dirigeants de sociétés multinationales. Par conséquent, les entreprises de plus en plus exposées à l’international - tant au niveau national par le biais de la concurrence étrangère qu’au niveau international par le biais de la présence sur les marchés étrangers - peuvent chercher à composer leurs échelons hiérarchiques supérieurs avec une combinaison appropriée de capital humain et social international ainsi qu’avec des connaissances diversifiées au niveau international dans la poursuite d’un avantage concurrentiel durable et de performances supérieures.

Resumen

Desarrollamos el constructo de capacidad gerencial dinámica global (GDMC por sus iniciales en inglés) e identificamos sus fuentes subyacentes: (1) capital humano internacional, (2) capital social internacional, (3) cogniciones gerenciales internacionales. Consistentes con el enfoque de capacidades dinámicas (DCV por sus iniciales en ingles), y la teoría de escalones superiores (UET por sus iniciales en inglés), sugerimos que la capacidad gerencial dinámica global lleva a una orquestación de los activos globales, lo cual, a su vez, resulta en un desempeño superior de la compañía en un proceso de dos etapas. Primero, la capacidad gerencial dinámica global lleva a las compañías a adoptar estrategias globales que despliegan el riesgo de internacionalizaciones en diferentes modos de entrada y regiones geográficas. Segundo, la (re)configuración de los activos globales influencia positivamente el desempeño subsecuente de la empresa y de este modo actúa de mediador en la relación entre la capacidad gerencial dinámica global y el desempeño. Hay que reconocer que la triada de factores que forman una capacidad gerencial dinámica global es crucial cuando se seleccionan los futuros gerentes de las corporaciones multinacionales. De ahí, las empresas con una exposición internacional en aumento -tanto a nivel nacional a través de la competencia extranjera como a nivel internacional a través de la presencia en el mercado extranjero- pueden buscar componer sus escalones superiores con una combinación adecuada de capital humano y social internacional, así como también como de cogniciones internacionalmente diversas en la búsqueda de una ventaja competitiva sostenida y un rendimiento superior.

Resumo

Desenvolvemos o construto de capacidade gerencial dinâmica global (GDMC) e identificamos suas fontes subjacentes: (1) capital humano internacional, (2) capital social internacional e (3) cognições gerenciais internacionais. Consistente com a visão de capacidades dinâmicos (DCV) e a teoria dos escalões superiores (UET), sugerimos que GDMC leve à orquestração global de ativos, o que por sua vez, resulta em desempenho superior da empresa em um processo de dois estágios. Primeiro, GDMC leva empresas a adotar estratégias globais que distribuem o risco de internacionalizações entre diferentes modos de entrada e regiões geográficas. Segundo, a (re) configuração de ativos globais influencia positivamente o subsequente desempenho da empresa e, portanto, medeia o relacionamento entre GDMC e desempenho. Reconhecer a tríade de fatores que formam a capacidade gerencial dinâmica global é crucial na seleção de futuros gerentes de empresas multinacionais. Portanto, empresas com crescente exposição internacional - tanto internamente por meio de concorrência estrangeira quanto internacionalmente através de presença no mercado externo - podem buscar compor seus escalões superiores com uma combinação adequada de capital humano e social internacional, bem como cognições internacionalmente diversas na busca de vantagem competitiva sustentada e desempenho superior.

摘要

我们开发了全球动态管理能力(GDMC)的概念, 并确定了其根本来源: (1)国际人力资本, (2)国际社会资本, 和(3)国际管理认知。与动态能力观(DCV)和高层梯队理论(UET)一致, 我们提出GDMC导致全球资产配置, 它进而在两阶段的过程中产生卓越的公司绩效。首先, GDMC导致公司采取全球战略, 将国际化风险分散到不同的进入模式和地理区域。第二, 全球资产的(重新)配置对随后的公司绩效产生了积极影响, 从而调节了GDMC与绩效之间的关系。当选择跨国公司的未来管理者时, 认识到形成全球动态管理能力的三元因素至关重要。因此,国际布局不断提高的公司(无论是在国内通过国外竞争还是在国际通过国外市场占有率)可以寻求将其高层梯队与国际人力和社会资本以及国际多元化的认知相结合, 以追求持续的竞争优势和卓越的绩效。

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ACKNOWLEDGEMENTS

We thank Esha Mendiratta for helping with the dataset matching algorithm and Mads-Emil Weddelsborg for his research assistance in the manual matching of the records.

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  1. University of Sydney Business School, Sydney, NSW, Australia

    Sabina Tasheva & Bo Bernhard Nielsen

  2. Copenhagen Business School, Frederiksberg, Denmark

    Sabina Tasheva & Bo Bernhard Nielsen

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  1. Sabina Tasheva
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  2. Bo Bernhard Nielsen
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Correspondence to Sabina Tasheva.

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Accepted by Shaker Zahra, Guest Editor, 12 April 2020. This article has been with the authors for three revisions.

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Tasheva, S., Nielsen, B.B. The role of global dynamic managerial capability in the pursuit of international strategy and superior performance. J Int Bus Stud 53, 689–708 (2022). https://doi.org/10.1057/s41267-020-00336-8

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