David J. Teece

Bio: David J. Teece is an academic researcher from University of California, Berkeley. The author has contributed to research in topics: Dynamic capabilities & Multinational corporation. The author has an hindex of 89, co-authored 312 publications receiving 93195 citations. Previous affiliations of David J. Teece include Yale University & University of Michigan.

Organizational Competencies and the Boundaries of the Firm

Abstract: The boundaries of the firm have two fundamental dimensions. A first one concerns the scope and limits of expansion of firms within the industry (or industries) where they operate. An explanation of the boundaries, in this sense, overlaps with the explanation of so-called ‘market structures’. Why is production in some industries highly concentrated and much less so in others? What makes the difference between, say, aerospace, pharmaceutical or mainframe computers, on the one hand, and garments or shoemaking, on the other? Leaving aside regulatory measures, such as antitrust legislations, what prevents industrial production from being monopolized within a single firm? Along this dimension the boundaries of the firm over time are set by the “forces generating and limiting concentration” in the evolution of each industry (Nelson and Winter (1982); see also Dosi et al. (1993)).

Vertical Integration and Risk Reduction

Abstract: In this paper we propose an indirect test of the "new institutional economics" (Williamson, 1975, 1981, 1985) by exploring the relationship between vertical integration and uncertainty. We present evidence that suggests that vertical integration, executed by merger, may reduce a firm's systematic or undiversifiable risk. That is, vertical mergers reduce risk by more than the simple portfolio effects that arise from combining business units in which returns are not perfectly correlated, suggesting that internal organization does have distinctive properties which cannot be easily replicated by stockholders taking separate asset positions in specialized companies operating at each stage of an industry. Uncertainty creates several kinds of problems for the organization of production. One is that it complicates decisionmaking. Because of uncertainty and bounded rationality, comprehensive contingent planning on how to

The Multinational Enterprise: Market Failure and Market Power Considerations

Abstract: The following sections are included:Relative Efficiency Properties of Markets and HierarchiesMultinational Firms and Market FailureIntermediate Product Markets and Vertical Direct Foreign InvesbnentHorizontal Direct Foreign Investment and the Market for Know-howInternational Capital Markets and Direct Foreign InvestmentPotential Anticompetitive Consequences of Multinational EnterpriseVertically Integrated MultinationalsThe Horizontal Expansion of Multinational FirmsEvaluationConclusionReferences

Technology, organization, and competitiveness : perspectives on industrial and corporate change

Abstract: Introduction 1. Information, Knowledge, Vision, and Theories of the Firm 2. Coase Revisited: Business Groups in the Modern Economy 3. Varieties of Hierarchies and Markets: an Introduction 4. Organizational Integration and Competitive Advantage: Explaining Strategy and Performance in American Industry 5. The Co-Evolution of Technology, Industrial Structure, and Supporting Institutions 6. Uneven (and Divergent) Technological Accumulation among Advanced Countries: Evidence and a Framework of Explanation 7. Technological Discontinuities, Organizational Capabilities, and Strategic Commitments 8. The Dynamic Capabilities of Firms: an Introduction 9. Transaction Cost Economics and Organization Theory

Dynamic capabilities and strategic management

Abstract: The dynamic capabilities framework analyzes the sources and methods of wealth creation and capture by private enterprise firms operating in environments of rapid technological change. The competitive advantage of firms is seen as resting on distinctive processes (ways of coordinating and combining), shaped by the firm's (specific) asset positions (such as the firm's portfolio of difftcult-to- trade knowledge assets and complementary assets), and the evolution path(s) it has aflopted or inherited. The importance of path dependencies is amplified where conditions of increasing retums exist. Whether and how a firm's competitive advantage is eroded depends on the stability of market demand, and the ease of replicability (expanding intemally) and imitatability (replication by competitors). If correct, the framework suggests that private wealth creation in regimes of rapid technological change depends in large measure on honing intemal technological, organizational, and managerial processes inside the firm. In short, identifying new opportunities and organizing effectively and efficiently to embrace them are generally more fundamental to private wealth creation than is strategizing, if by strategizing one means engaging in business conduct that keeps competitors off balance, raises rival's costs, and excludes new entrants. © 1997 by John Wiley & Sons, Ltd.

Dynamic capabilities, what are they?

Abstract: This paper focuses on dynamic capabilities and, more generally, the resource-based view of the firm. We argue that dynamic capabilities are a set of specific and identifiable processes such as product development, strategic decision making, and alliancing. They are neither vague nor tautological. Although dynamic capabilities are idiosyncratic in their details and path dependent in their emergence, they have significant commonalities across firms (popularly termed ‘best practice’). This suggests that they are more homogeneous, fungible, equifinal, and substitutable than is usually assumed. In moderately dynamic markets, dynamic capabilities resemble the traditional conception of routines. They are detailed, analytic, stable processes with predictable outcomes. In contrast, in high-velocity markets, they are simple, highly experiential and fragile processes with unpredictable outcomes. Finally, well-known learning mechanisms guide the evolution of dynamic capabilities. In moderately dynamic markets, the evolutionary emphasis is on variation. In high-velocity markets, it is on selection. At the level of RBV, we conclude that traditional RBV misidentifies the locus of long-term competitive advantage in dynamic markets, overemphasizes the strategic logic of leverage, and reaches a boundary condition in high-velocity markets. Copyright © 2000 John Wiley & Sons, Ltd.

Evolving to a New Dominant Logic for Marketing

Abstract: Marketing inherited a model of exchange from economics, which had a dominant logic based on the exchange of “goods,” which usually are manufactured output The dominant logic focused on tangible resources, embedded value, and transactions Over the past several decades, new perspectives have emerged that have a revised logic focused on intangible resources, the cocreation of value, and relationships The authors believe that the new perspectives are converging to form a new dominant logic for marketing, one in which service provision rather than goods is fundamental to economic exchange The authors explore this evolving logic and the corresponding shift in perspective for marketing scholars, marketing practitioners, and marketing educators

Toward a Knowledge-Based Theory of the Firm

Abstract: Given assumptions about the characteristics of knowledge and the knowledge requirements of production, the firm is conceptualized as an institution for integrating knowledge. The primary contribution of the paper is in exploring the coordination mechanisms through which firms integrate the specialist knowledge of their members. In contrast to earlier literature, knowledge is viewed as residing within the individual, and the primary role of the organization is knowledge application rather than knowledge creation. The resulting theory has implications for the basis of organizational capability, the principles of organization design (in particular, the analysis of hierarchy and the distribution of decision-making authority), and the determinants of the horizontal and vertical boundaries of the firm. More generally, the knowledge-based approach sheds new light upon current organizational innovations and trends and has far-reaching implications for management practice.

The Relational View: Cooperative Strategy and Sources of Interorganizational Competitive Advantage

Abstract: In this article we offer a view that suggests that a firm's critical resources may span firm boundaries and may be embedded in interfirm resources and routines. We argue that an increasingly important unit of analysis for understanding competitive advantage is the relationship between firms and identify four potential sources of interorganizational competitive advantage: (1) relation-specific assets, (2) knowledge-sharing routines, (3) complementary resources/capabilities, and (4) effective governance. We examine each of these potential sources of rent in detail, identifying key subprocesses, and also discuss the isolating mechanisms that serve to preserve relational rents. Finally, we discuss how the relational view may offer normative prescriptions for firm-level strategies that contradict the prescriptions offered by those with a resource-based view or industry structure view.