Role of ‘corporate persistence’ and ‘environmental support’ in building breakthrough capability: Empirical investigation of Samsung’s initiatives in memory and microwave oven business

Abstract

It is now an incontrovertible fact that capabilities are the source of competitive advantage. However, the process through which firms build capabilities over a period of time is only partially understood. Concepts like learning, resource combination, and co-evolution can be categorized as enablers as they support capability formation. On the other hand, concepts like inertia and path dependence can be categorized as restrictors as they constrain the process of capability formation. Combined together, while these concepts hint in the right direction, there is a need to have concepts that explain the process of capability formation holistically. An endeavour towards this objective would require taking into account the role of internal and external events. This paper builds concepts of ‘corporate persistence’ and ‘environmental support’ to explain their role in building breakthrough capability by examining major events in the evolution of two mega high technology business belonging to the Samsung group.