THE INTERPLAY OF DOMINANT LOGIC AND DYNAMIC CAPABILITIES IN INNOVATION ACTIVITIES

Within the strategic management literature, both managerial cognition and dynamic capabilities have been identified as drivers of change and transition in changing business environments. The purpose of this study is to explore the interplay of dominant logic and dynamic capabilities in the magazine publishing industry. We investigated four magazine publishing business units of a large media corporation situated in four different countries, namely Finland, the Netherlands, Hungary and Russia. A total of 40 magazine managers were interviewed. The results imply that dominant logic and dynamic capabilities coevolve in a reciprocal relationship, and the interplay of cognition and capabilities seems to be most visible in the seizing and reconfiguring capabilities. The results of the present study also illustrate that there may be several contradictory dominant logics within a single company. Dynamic capabilities useful to innovation processes are developed in the areas that are pinpointed by the managers as the locus of attention. Industry transition does not automatically change what companies think and do. That requires managerial attention and an active reconceptualization of the business and active development of not only day-to-day operations, but capabilities needed to change the way we work.