The implementation of change for incumbent multinationals : a strategic analysis of Telenor Research performed through a dynamic capability lens.

Abstract

A common perception in the field of strategic management is that incumbent multinational companies (MNCs) usually fail to remain relevant in their industry and rarely introduce radical product innovation when they confront certain types of market or technological changes. The existing theory on dynamic capabilities suggests that MNCs attempting to change when faced with market discontinuities can draw on a certain set of capabilities to innovate their business model. The micro-foundations of the dynamic capability framework (the distinct skills, processes, procedures organisational structures, decision rules and disciplines, which undergird the enterprise-level sensing, seizing and transforming capabilities) are difficult to develop and deploy due to their idiosyncratic nature. The purpose of this paper is to study the dynamic capability phenomenon on a real case setting; adopting a longitudinal case study approach. The research object of this project is the incumbent multinational company Telenor, who needs to adjust its business strategy in order to remain a pertinent actor in its sector. This paper investigates the mechanisms through which, the company’s research unit develops dynamic capabilities in order to sustain change at Telenor. The sensing, seizing and transforming roles of Telenor Research are assessed through a qualitative analysis where data have been collected through the interview of seven research unit managers. In doing so, the findings provide an example of case application towards the concept of dynamic capabilities. The qualitative data collected have been analysed following a template analysis method and sensing and seizing capabilities have been identified. These are notably supported by the corporate open innovation philosophy and engagement towards new technologies. Evaluation of the transformation capabilities could not, however, be fully assessed in this research since Telenor Research does not have the responsibility to transform knowledge into business value.