THE CONSTRUCTION OF DYNAMIC CAPABILITIES FOR

PUBLISHING ENTERPRISES

A Business Ecosystem Perspective

Ling Yang

1,2

and Runtong Zhang

School of Economics and Management, Beijing Jiaotong University, Beijing, P.R. China

Publishing Hourse, Capital University of Economics and Business, Beijing, P.R. China

Wei Chen

School of Information Management, Capital University of Economics and Business, Beijing, P.R. China

Keywords: Business ecosystem, Dynamic capabilities, Publishing enterprises.

Abstract: Nowadays, many scholars and mangers focus on dynamic capability, which is defined as “the firm’s ability

to integrate, build, and reconfigure internal and external competences to address rapidly changing

environments”. Although there are many research results, they pay little close attention to publishing

enterprises. Considering of the particularity of the publishing enterprises, in this paper, we discuss its

identification and construction from the perspective of business ecosystem.

1 INTRODUCTION

With the development of the economic globalization

and technology, there are fundamentally changes for

enterprises’ competitive environment, competitive

mode and organizational form. On the one hand,

enterprises’ competitive environment presents

dynamic and complexity trend, because rapid

developing technology and ever-changing customer

demands. On the other hand, applications of the

information and network technology change the

foundation of enterprise competing capability, and

the cooperation model based on the division of

labour can make enterprises satisfy the ever-

changing customer demands by alliance and

cooperation. Therefore, dynamic competence theory

and business ecosystem theory put forward the

problem that how to get the enterprise competitive

advantage from different perspectives. The main

contributions of this paper are: (1) we extend the

framework of the dynamic capability to the scenario

of the business ecosystem, and propose the

conceptual model of the Enterprise Dynamic

Capability (EDC) based on the business ecosystem

theory. (2) We discuss the homogeneity and

heterogeneity of the dynamic capability, and then

propose the reason of the heterogeneity is

environmental uncertainty. (3) We apply the

conceptual model of EDC to the publishing

enterprises’ business ecosystem, which will be

benefit to identify, construct and measure the

dynamic capability of the publishing enterprises.

2 THE CONCEPTUAL MODEL

OF THE ENTERPRISE

DYNAMIC CAPABILITY

2.1 Business Ecosystem Meaning and

Competitive Advantage Acquisition

Starting in the early 1990s, Moore (Moore, 1996)

originated the strategic planning concept of a

business ecosystem, now widely adopted in the high

tech community. Moore defined "business

ecosystem" as: “An economic community supported

by a foundation of interacting organizations and

individuals—the organisms of the business world.

The economic community produces goods and

services of value to customers, who are themselves

members of the ecosystem. The member organisms

636

Yang L., Zhang R. and Chen W..

THE CONSTRUCTION OF DYNAMIC CAPABILITIES FOR PUBLISHING ENTERPRISES - A Business Ecosystem Perspective.

DOI: 10.5220/0003616706360640

In Proceedings of the 13th International Conference on Enterprise Information Systems (PMSS-2011), pages 636-640

ISBN: 978-989-8425-56-0

 2011 SCITEPRESS (Science and Technology Publications, Lda.)

also include suppliers, lead producers, competitors,

and other stakeholders. Over time, they coevolve

their capabilities and roles, and tend to align

themselves with the directions set by one or more

central companies. Those companies holding

leadership roles may change over time, but the

function of ecosystem leader is valued by the

community because it enables members to move

toward shared visions to align their investments, and

to find mutually supportive roles.” In one business

ecosystem, different ecological members can form

enterprise ecological circle by means of the resource

and ability complementary, which can better provide

the core products and services for customs. In the

business ecosystem, the creation of enterprise value

depend on not only the enterprise itself competitive

advantage, but also its relation network advantage.

The network resource of the business ecosystem can

be used by the enterprise and its partners, which

comes from learning effect, spillover effect,

cooperation effect and complementary effect among

the ecological members. In addition to the traditional

VRIN characteristics, these network resources have

sharing features. Enterprises could obtain and share

integrated knowledge by participating in business

ecosystem, and then improve enterprises innovation

performance and product competitiveness, which

make enterprises to obtain sustained relationship

rents (Dyer, 2006). To gain the competitive

advantage, ecological members can obtain scope

economy and scale economy by choosing and

constructing healthy business ecosystem. Business

ecosystem theory can solve how to realize the

synergies through the mutual correlation between

enterprises. Its limitations are rarely discussing

which resources and capability should be have by

the individual enterprise in order to realize the

effective coupling with the resource of the business

ecosystem.

2.2 Conceptual Model of Enterprise

Dynamic Capability

Dynamic capability is a kind of capability for an

enterprise to adapt the changing circumstances

though the integration, construction and reform of

the competence both inside and outside (

Teece, 1997).

The dynamic capability theory regards that, under a

dynamic condition, the enterprise which owns the

core capability only can get the competitive

advantage temporarily because the competitors will

substitute its advantage position quickly by imitation

and creation. As a result, the enterprise should renew

its capability to suit the quickly changing

circumstance and keep the sustaining competitive

advantage. At present, the research on the frame and

dimensionality of dynamic capability is widely

distributed, and different researchers discuss this

issue through the different view, such as knowledge,

technology and integration. Based on the relational

theory, dynamic capability was analysed extending

to the inter-organizational level, that is, to regard the

organization network as the analysis cell. Bakos &

Treacy proposed that dynamic capability should

include two or more organizations. The newest

research on dynamic capability also supports that the

strategy analysis should be based on the business

ecosystem concept instead of industry, and they also

proposed that dynamic capability was benefit for

enterprise to choose, breed and construct business

ecosystem (

Teece, 2006).

In the 3P (process ， Positions ， Paths) frame

model of dynamic capability, the competitive

advantage of enterprise derives from the

competitiveness and capability of organizational

process, while the organizational process was shaped

by the asset advantage (especially the appropriative

asset and complementary assets) and evolution paths

of enterprise. In this paper, we propose that the

limitation of 3P frame is to treat the appropriative

asset and complementary assets in a static state

without considering the dynamic co evolution of the

enterprise and business ecosystem. The dynamic co

evolution means that the enterprise capability and

knowledge is embedded not only the inside

operation process in enterprise but also the

interactive process with business ecosystem and

conditions. As a result, in the view of business

ecosystem, dynamic capability is a kind of capability

for an enterprise to adapt the changing

circumstances through the integration, construction,

reform and matching of the resources both inside

and outside the enterprise. The embedding of

enterprise to the business ecosystem has a feature of

path dependence, and its main dimensionalities are

identification ability, network ability, resource

operation ability, open innovation ability and

advantage protection ability. The concept model is

showed as figure 1.

The strategic logic of conceptual model of the

enterprise dynamic capability based on the business

ecosystem theory is to seize the creative opportunity

of the enterprise, decide the vision of business

ecosystem and choose the suitable strategy through

the search and filter of information space. According

to the chosen strategy, the enterprise fixes the

resource demand, chooses the cooperation partner,

constructs value network to gain the complementary

THE CONSTRUCTION OF DYNAMIC CAPABILITIES FOR PUBLISHING ENTERPRISES - A Business Ecosystem

Perspective

637

resources, deploys and shares the knowledge and

resource both inside and outside and protects the

resource advantage, as well as gains the new

competitive advantage. When the business

ecosystem turns into the phase of decline, the

enterprise renews to search the new creative

opportunity and cooperation, and gain the

continuous development under the hypercompetitive

environment though the health business ecosystem

and constant creation.

Figure 1: Conceptual model of the enterprise dynamic

capability based on the business ecosystem theory.

3 IDENTIFICATION AND

MEASUREMENT OF

PUBLISHING ENTERPRISES’

DYNAMIC CAPABILITY

3.1 Homogeneity and Heterogeneous of

Enterprises’ Dynamic Capability

Dynamic capability theory is difficult to operate and

measure during the process to instruct the enterprise

practice, thus the application of this theory has also

be affected. To solve this problem, firstly we should

probe whether the dynamic capability in different

enterprises has the homogeneity. Teece proposed

that the dynamic capability is heterogeneous because

of the individual heterogeneity and the specific paths

dependence. Eisenhardt &Martin proposed that the

dynamic capability has the overall character in the

key points, but it showed the different forms under

the different market conditions and it was probably

heterogenous in the specific establishment and type

of rearing as the enterprises were different, such as

the products development programme of Honda,

resources deploy process of Intel, the merger and

integration process of HP, and so on. In this paper,

we propose that dynamic capability is not the single

capability but a group of capability bundle and it is

multidimensional and multi-hiberarchy which shows

the different shape under the different situation and

field. Thus, dynamic capability should be effective

identified when applying it to the practice of

enterprise.

3.2 Business Ecosystem Characteristics

of the Publishing Enterprises in the

Digital Environment

Print means the broadcast activities from private

space to the public area with style of publication

through the edit and publish of literature works. The

core of print is the materialization and broadcast of

knowledge, so it has the characters of economical

and culture efficiency which endows the print

activity and print competition specialization

character. In the traditional print industry chain

which mainly depends on the papery books, the

information broadcast mode is in line shape and the

print enterprise located on the core position of

industry chain.

Development of computer communication and

network technology brings the change of

information broadcast and copy mode which

changes the medium zoology and copyright zoology.

Thus, it has the revolutionary effects on the print

industry. Along with the change of obtain style of

knowledge and information, as well as readers’

peruse habit, and fading of traditional print concept,

the print industry, media industry and

communication industry compromises gradually and

hyper-media print business ecosystem comes into

being gradually. The media ecosystem is consisting

of print ecosystem, newspaper ecosystem, journal

ecosystem, broadcast ecosystem and television

ecosystem. In simulation technique era, print and

newspaper population occupies the vision by word

information; broadcast population occupies the

hearing by voice information; and television

population occupies the audiovisual by voice and

video. Digital copy and broadcast technology

changes the separate state of the above-mentioned

populations and makes them across. The aggravate

competition of different populations urges the

emerging of a new print business ecosystem, that is

hyper-media print business ecosystem. Comparing

with the traditional print industry chain, members of

hyper-media print business ecosystem turns more

complex and diverse. It contains not only members

of traditional industry chain, but also the digital print

enterprises, plat-form enterprises, digital technology

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facilitator and terminal reading suppliers. The core

position of the traditional print enterprise declines,

but the position of plat-form enterprise and

facilitator who own the technology rises gradually.

The two parts realize the complementary advantage

based on the resource owning.

3.3 Environmental Uncertainty of the

Publishing Enterprises

Researchers find that the effective dynamic

capability shows the different shape under the

different market conditions. Most papers regard the

dynamic of circumstance is a regulated variable

between dynamic capability and performance and

the logic of this theory is atomistic view. In view of

business ecosystem theory, the performance of

enterprise consist in the business ecosystem network,

and the relationship between enterprise and

circumstance is not the action and reaction, but the

interaction and cooperation. Thus, we should

consider the circumstance as the predictor variable

of affecting the dynamic capability.

The uncertainty of circumstance means the

unpredictability of changing of marketing

transaction circumstance, and it reflects the

complication, unknown and turbulence of enterprise

circumstance which is normally measured by market

turbulence, technology turbulence and competitive

intensity. The print activity has not only the

character of economical efficiency, but also the

character of special politics efficiency and culture

efficiency. As a result, when we evaluate the print

enterprise circumstance, we should consider not only

the marketing factor, but also the non-marketing

factor.

Due to the high uncertainty of circumstance of

print enterprise, the renew and regenerate dynamic

capability are the expression of the dynamic

capability of print enterprise and the importance is

the renewal of resource and capability.

4 IDENTIFICATION OF THE

DYNAMIC CAPABILITY FOR

THE PUBLISHING PRESS

Heterogeneity of the dynamic capability is related

not only with methods of updating resource and

ability, but also with adoption of effective activities.

According to proposed the conception model of the

dynamic capability, we interviewed with 20

executives of publishing business, and then obtain

some factors of the publishing enterprises’ dynamic

abilities in the view of business ecosystem as shown

in Figure 2. Moreover, some factors and measures of

dynamic abilities for publishing enterprise are also

listed in Table 1.

Figure 2: Factors of the publishing enterprises’ dynamic

abilities in the view of business ecosystem.

5 CONCLUSIONS

Hyper-medium business ecosystem provides all-

round service and experience for reader through

medium complementary effect and network

resources effect. So, it has the incomparable

competitive advantage compared to traditional

publishing industry chain and changes the

competitive situation and mode of the whole media

ecology. Traditional publishing enterprises must join

in one or several business ecosystem to survive and

develop. By resources complementary, knowledge

sharing and synergies, they will hold the core

position gradually and establish their own leadership

position. Therefore, construction and breeding of the

dynamic capability are very important for traditional

publishing enterprises to facing threat and gain

sustainable competitive advantage.

REFERENCES

Moore, J. F. 1996. The Death of Competition: Leadership

and Strategy in the Age of Business Ecosystems, New

York: Harper Business.

Dyer, J. H., Hatch, N.W., 2006. Relation-specific

capabilities and barriers to knowledge transfer:

creating advantage through network relationships.

Strategic Management Journal, 27: 701-719.

Teece, D. J., Pisano, G, Shuen, A, 1997. Dynamic

capabilities and strategic management. Strategic

Management Journal, 18(7):509-533.

Teece, D. J.2006, Reflections on profiting from innovation.

Research policy,35(8):1131-1146.

THE CONSTRUCTION OF DYNAMIC CAPABILITIES FOR PUBLISHING ENTERPRISES - A Business Ecosystem

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Table 1: Factors and measures of dynamic abilities for publishing enterprise.

Dynamic capability indexes and

meaning

Dynamic

competence

factors

Dynamic

capability

attributes

Measured variable

Identification

ability

Identify technology

and market

changes, investigate

the health condition

of the business

ecosystem

Market

oriented

ability;

Entrepreneurs

ability

Learning Collection and feedback of readers;

Acquaintance of innovation process

of the suppliers and distributors,

technology business, other press;

Information transmission efficiency

in internal departments;

Reaction efficiency for the outside

changes by the senior management

Networking

capability

Selection of the

core resource,

confirmation of the

cooperative partners

and complementary

resources

Flexible

alliance

ability

Learning;

Coordination;

Update.

Timeliness of cooperation

investment decisions;

Cooperate with many partners

(platforms, technology provider,

operators, counterparts );

Cooperation method is flexible;

Put forward a constructive solutions

during the conflict with partners;

Enterprises determine quantity of

printing and circulation.

Operating

ability

resources

allocation 、

complementary

resources、

resources sharing、

resources

integration

Resources

integration

ability

Integration;

Leaning.

Technology resources and channel

resources are obtained through

cooperation;

Subjects are selected with authors

and business partners;

Marketing program is implemented

with technology developers and

channels;

Management, planner and

marketing staff should often learn

and communicate with the outside

world.

Open

innovation

ability

Develop core

product with

ecological

members, and

provides total

solutions for

customs

Collaborative

product

innovation

ability

Update The innovation of the new product

content;

Diversity and standardization of the

product content;

Digitization and conformability of

the product and service;

Realization of the digital publishing

and publishing on demand.

Advantage

protection

ability

Protection of the

core resources and

knowledge

Ability of

intellectual

property

protection

Coordination

Right of Product information

network transmission;

Right of read and copy;

Internet copyright of enterprise;

Control of digital copyright

protection technology ;

Creative personnel outflow

phenomenon.

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