Teece vs. Porter: Perspective of Innovation Studies
Teece vs. Porter: Perspective of Innovation Studies
When a company enters a market, it wants to be successful. Unfortunately most firms fail unless they have an advantage over there competitors. Yet, one question arises; how does one obtain this competitive advantage? One issue made clear by two major authors Teece and Porter suggests that “competitive advantage is at the core of a companies success. Yet how this advantage is achieve or maintained is where these two authors differ. We focus on the theories of Porter and Teece as the premise of the argument. It is clear that Porter claims that a company’s actions combined with their environment determines their success. On the other hand, Teece argues for the importance of dynamic capabilities (sensing, seizing and managing threats/reconfigurations) as central to attaining and sustaining competitive advantage. This essay evaluates these theories from an innovation studies perspective. Although innovation studies may not be a subscribed field, innovation is critical to the study of business. Seeing how changes in technology have caused small endeavours to become industry empires, the study of innovation is critical in understanding successes and failures. How does one know if a framework can incorporate innovation or could be applied to innovative/dynamic contexts? This paper argues that there is an inextricable link between innovation and learning. A theoretical framework that does not account for either learning nor change, but lacks a necessary theoretical foundation to incorporate or analyze innovation. Learning is important yet, overlooked by many within the business sector. Thus, the argument presented within the context of this paper outlines how Teece’s paradigm of dynamic capabilities has space within its theoretical framework to account for innovation. (in its many forms and contexts) On the other hand, Porter’s paradigm of competitive advantage does not emphasize learning or change in a way that
When a company enters a market, it wants to be successful. Unfortunately most firms fail unless they have an advantage over there competitors. Yet, one question arises; how does one obtain this competitive advantage? One issue made clear by two major authors Teece and Porter suggests that “competitive advantage is at the core of a companies success. Yet how this advantage is achieve or maintained is where these two authors differ. We focus on the theories of Porter and Teece as the premise of the argument. It is clear that Porter claims that a company’s actions combined with their environment determines their success. On the other hand, Teece argues for the importance of dynamic capabilities (sensing, seizing and managing threats/reconfigurations) as central to attaining and sustaining competitive advantage. This essay evaluates these theories from an innovation studies perspective. Although innovation studies may not be a subscribed field, innovation is critical to the study of business. Seeing how changes in technology have caused small endeavours to become industry empires, the study of innovation is critical in understanding successes and failures. How does one know if a framework can incorporate innovation or could be applied to innovative/dynamic contexts? This paper argues that there is an inextricable link between innovation and learning. A theoretical framework that does not account for either learning nor change, but lacks a necessary theoretical foundation to incorporate or analyze innovation. Learning is important yet, overlooked by many within the business sector. Thus, the argument presented within the context of this paper outlines how Teece’s paradigm of dynamic capabilities has space within its theoretical framework to account for innovation. (in its many forms and contexts) On the other hand, Porter’s paradigm of competitive advantage does not emphasize learning or change in a way that
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