Examining the role of dynamic combinative capability and learning in service innovation-based performance in project-oriented service firms

This paper addresses the limited empirically founded approaches to model the antecedents of service innovation/new service development (NSD) and service firm performance. Drawing on the dynamic capability-based view of competitive strategy, the paper attempts to model the role of dynamic capabilities in NSD and firm performance using the project-oriented firm context. The model conjectures that entrepreneurial project-oriented service firms pursuing innovation, build and nurture dynamic combinative capability and learning capabilities. The findings of a study of 190 project-oriented firms confirm that the ability of the firm to strategically combine resources is linked to service innovation-based performance. Implications for theory and practice are discussed.