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Dynamic Managerial Capabilities And R&D Spending: The Role Of Ceo Founder Status

Author

Listed:
  • TIM HEUBECK

    (International Management, Faculty of Law, Business, and Economics University of Bayreuth, Universitätsstrasse 30, D-95447 Bayreuth, Germany)

  • REINHARD MECKL

    (International Management, Faculty of Law, Business, and Economics University of Bayreuth, Universitätsstrasse 30, D-95447 Bayreuth, Germany)

Abstract

Today’s hypercompetitive economy challenges chief executive officers (CEOs) to make complex yet integral investments in research and development (R&D). Although research has widely discussed R&D spending due to its implications for competitive advantage, it omits whether and how managers’ dynamic capabilities materialise in these long-term investment decisions. This study builds on dynamic managerial capability (DMC) theory to argue that strong managerial-level dynamic capabilities increase R&D spending by improving the capacities of CEOs to sense opportunities and threats, seize them, and reconfigure organisational resources. CEO founder status is additionally proposed as a moderator of this relationship, as founder CEOs differ from professional CEOs in their investment behaviour. The results reveal that DMCs only compositely contribute to R&D investments, while the DMC subcomponents–except for managerial social capital—exert no isolated effects. This study also finds that founder CEOs realise higher R&D investments through their DMCs than their professional counterparts.

Suggested Citation

  • Tim Heubeck & Reinhard Meckl, 2022. "Dynamic Managerial Capabilities And R&D Spending: The Role Of Ceo Founder Status," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 26(10), pages 1-39, December.
    • Handle: RePEc:wsi:ijimxx:v:26:y:2022:i:10:n:s1363919622500748
    DOI: 10.1142/S1363919622500748
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