Identifying the Factors that Affect Innovation Adopting the Dynamic Capabilities and Strategic Entrepreneurship Perspectives

Innovation is one of the main success factors of knowledge-based firms in today’s economy. Management Consultancies, to be successful in the competitive environment, need to develop capabilities and adopt strategies to strengthen organizational innovation. Strategic entrepreneurship and dynamic capabilities theories are among the perspectives that can explain the sources of innovative value creation. In the present research, adopting these theories, it was attempted to explain the capabilities and strategies that facilitate innovation in Management Consultancies. The research was qualitative in essence and was conducted using a multiple case study approach. Theoretical thematic analysis was used to analyze data. The sample consisted of five innovative Management Consultancy firms in Iran. The results showed that consultancy firms developed and strengthened six opportunity-seeking behaviors include collaboration and network-building, recruitment of knowledge workers, training programs, using new techniques, entering emerging industries, and learning from projects. They also shaped six advantage-seeking capabilities include dynamic formulation and implementation of strategies, following up of strategic objectives, managing business scope, project management, cost management, and managing part-time personnel. Client orientation and professionalism were the strategies that balanced out opportunity-seeking and advantage-seeking capabilities.