Business model innovation by international social purpose organizations: The role of dynamic capabilities

• Published in: Journal of business research 2021-03, Vol.125, p.733-749
• Main Authors: De Silva, Muthu, Al-Tabbaa, Omar, Khan, Zaheer
• Format: Article
• Language: English
• Subjects: Associations, institutions, etc; Business Model Innovation; Business schools; Case studies; Co-creation; Dynamic capabilities; Economic value; Hybrid Organizations; International Social Purpose Organizations; Microfoundations; Social value
• ISSN: 0148-2963; 1873-7978
• DOI: 10.1016/j.jbusres.2019.12.030

•Identify dynamic capabilities deployed by ISPOs at different stages of BMI.•Unique managerial, cognitive, and relational capabilities of founders to sense opportunities.•Knowledge exchange is key for production-marketing integration at seizing stage.•Dynamic capabilities for co-creation is key to scale-up the business models of ISPOs. This paper examines the role played by dynamic capabilities and business model innovation in international social purpose organizations (ISPOs)11International Social Purpose Organizations (ISPOs). operating across developing and developed countries. Utilizing a qualitative multiple case study methodology, we identify a set of dynamic capabilities deployed and leveraged by these organizations for business model innovation in order to achieve their dual mission of social and economic value creation. The findings highlight unique micro-foundational capabilities of the founders that are vitally important to perceive social challenges as opportunities for ISPOs to sense socially and economically intertwined prospects. We discuss the specific organizational-level capabilities—at both the production and selling sites—that are developed and utilized by ISPOs to seize opportunities by combining competing social and economic logics. In relation to transformation, ISPOs develop ecosystem-wide production- and market-related capabilities—in both developing and developed countries—that enable them to scale-up their dual mission business model through co-creation.