Dynamic Capabilities

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Methodology & Method

The first part of this section will focus on the methodology including the philosophical perspective, research approach and strategy. The second section will present the method used when gathering and analyzing our empirical data, including the sampling method, interview design, data collection, and how the empirical data was analyzed.

Methodology

Philosophical Perspective

Epistemology can be explained by the way we address reality and refers to the knowledge and justified belief (Saunders, Lewis & Thornhill, 2016). There are two dominant ideologies within epistemology; positivism and interpretivism. Positivism is based on the belief that knowledge is built on reality through scientific methods while interpretivism is influenced by multiple views to build a social development of knowledge (Saunders et al., 2016). According to Miles, Huberman, & Saldaña (2014), a qualitative study is used when one seeks to understand how and why context matters and when making comparisons to discover important patterns and themes across cases. Therefore, a qualitative research was chosen for this study in order to increase the researchers understanding of opinions and motivations in connection to how ECCs use their exploitative and explorative dynamic capabilities when internationalizing. The interpretivist approach tends to use smaller samples, has a natural location and focuses on generating theories, and therefore, more suitable for a qualitative research (Saunders et al., 2016). Thus, we believe that interpretivism suits the purpose of this study. The meaning of interpretivism is to understand the interpretation of individuals and the social phenomena as well as exploring the complexity which is done through qualitative research (Rehman & Alharthi, 2016). Even though using an interpretivist approach may develop rich, subjective and qualitative data there is a risk that it produces results with low reliability. This can be explained by the nature of using small samples. Since our purpose is to investigate how an ECC uses exploitative and explorative dynamic capabilities when internationalizing, the aim is not to discover a truth as in positivism (Rehman & Alharthi 2016). Instead our purpose is to understand the interpretation of multiple individuals regarding the social phenomena which they interact in. Therefore, the interpretivist approach is argued to be suitable for this study. Furthermore, the qualitative data has been gathered using semi-structured interviews which according to Saunders et al. (2016), is considered an appropriate method when applying an interpretivist approach.

Research Approach

For this study we have chosen the abductive research approach. When conducting an abductive research, data collection is used to explore a phenomenon, identify themes as well as patterns and locate these in a conceptual framework (Saunders et al., 2016). In contrast to deduction and induction the abductive approach focuses on generation or modification of existing theory or model (Saunders et al., 2016). Moreover, the abductive approach seeks to generate information within a specific context (Awuzie & McDermott, 2017). It was discovered that there is a large base of data covering the internationalization process firms. However, a gap in the literature regarding the context of internationalization of ECCs combined with dynamic capabilities could be identified. Furthermore, an abductive approach is appropriate when there is a big collection of information in one context but limited information regarding the specific area of the research (Saunders et al., 2016). Therefore, an abductive approach fits our study since it will allow us to use our findings to build on the existing international dynamic capabilities model using the different capabilities connected to survival and growth. According to Maanen, Sorensen, & Mitchell (2007), the abductive approach is a continuous process where the analysis is preceded by using a combination of concepts and data. This approach allowed us to use theory and data in the analysis to expand our current understanding of internationalization process of fashion ECCs.
According to Mantere & Kretokiv (2013), the aim of an abductive approach is to use existing theory and data in order to expand the current understanding of a theory. At the same time, it allows the researchers to be open to new information which may be deviated from what is considered to be standard. Therefore, an abductive study is considered highly relevant for this thesis since we have used the literature review combined with primary data collected from fashion ECCs to investigate how dynamic capabilities are used in the internationalization. Moreover, our theoretical framework has been used to expand the existing theory regarding the internationalization process and how this is connected to fashion ECCs, while being open to new findings and developing theories.

Research Strategy

The objective of a research strategy is to give direction and allow researchers to answer the research questions and to meet the objectives of the study (Saunders et al., 2016). Since the aim of our paper is to gather information regarding a phenomenon that is rather unexplored and look for patterns and ideas instead of testing a hypothesis, we claim our research as explorative. Moreover, the aim of this research is to gather information and perspectives from a rather small sample instead of collecting numerical data from a larger sample. According to Saunders et al., (2016) an exploratory study is a valuable mean to ask open questions and to gather insights about a specific topic. In order to present data to answer the research question, interviews with individuals possessing knowledge and experience within the subject will be conducted. Due to the nature of our study, we decided to conduct qualitative semi-structured interviews where we have identified a list of themes and key questions that were covered during the interviews. We believed that semi-structured interviews would allow us to understand the respondents reasoning and opinions regarding the specific topic. Moreover, by following this research strategy, we hoped to gain a deeper understanding of the internationalization process of the different fashion ECCs.

Method

Sampling Method

The non-probability sampling method has been chosen for our study where the purposive sampling has guided the selection of our interviewees. Purposive sampling can also be referred as judgmental sampling as there is a need to use one’s judgement to select cases that will meet the objectives of one’s research (Saunders et al., 2016). Due to the purpose of our study we have a clear vision of what sample units are needed. Therefore, purposive sampling is deemed as the most appropriate for our research. One important aspect of our sampling method was to identify and select individuals whom possessed knowledge and experience within our subject. In addition, the availability and willingness to participate was also a crucial factor of our sampling method. Thus, we have constructed four eligibility criteria that guided the choice of interviewees. The two first criteria are related to the company characteristics. It was important that the company was an ECC operating in the fashion industry and in multiple countries. The next criteria are more individual-related as it was vital that the respondent was working in the company at the time of the interview to ensure that the most relevant and recent information was given. Moreover, it was also important that the interviewees possessed knowledge regarding internationalization of e-commerce. Therefore, we define having a direct key position related to e-commerce as a criterion. We define key position as CEO, Manager, or Wholesale director. The resulting sample that is based on our eligibility criteria is summarized in the table below.

Interview Design

For this study we conducted qualitative in-depth interviews. The purpose of those was to gain deeper understanding of the different companies’ business strategies and operations. Therefore, primary data was collected through interviews with different fashion ECCs. In-depth interviews allow the researcher to explore the participants perspective on a particular idea (Turner, 2010). In fact, one of the main advantages is that in-depth interviews give more detailed information about the topic studied. Therefore, this technique was preferred as it enabled us to explore the interviewees full perspective on the topic. Moreover, this also gives the interviewee the freedom of developing their answers and theories (Easterby-Smith et al., 2018). Primary sources are of great importance to our study due to the fact that we are conducting an exploratory study. In addition, secondary data has been collected for the purpose of gathering information about the companies and understanding their internationalization process. The different company’s websites are the main secondary sources used and complemented by LinkedIn, Facebook and Instagram profiles.
When preparing for our interviews, we made sure that our respondents had knowledge about international fashion ECCs and the resources and capabilities that their companies have developed. It was very important to be clear with our interview questions and that the interviewees understood the different concepts mentioned. For this, we created a list with all the concepts and definitions that could potentially be unclear (see Appendix 3). Also, biased and/or leading questions were avoided as it could have influenced the interviewees’ answers. Moreover, the interview questions and the list of concepts were sent to the participants beforehand to make sure that they were prepared and to avoid potential confusions or misunderstandings. This was also important for the study as it would make it simpler for the interviewees to give relevant answers. We conducted semi-structured interviews with open-ended questions. Semi-structured interviews often give a higher degree of confidentiality and allows the interviewee to be more personal (Easterby-Smith et al., 2018). We agree that this is important for our research as it gives the interview both structure, flexibility and is in line with our philosophical stands.
The questions were divided into two sections; general questions and key topic questions. The general questions concerned the company’s internationalization process and served as “icebreakers” to gain additional knowledge about the company itself. These questions were limited and served the purpose of building trust and developing a comfortable environment. Depending on the knowledge gathered through secondary sources, more opening questions might have been asked to ensure that we have gathered all the relevant information about the company. On the other hand, the key topic questions focused on the exploitative and explorative dynamic capabilities and were divided into four subcategories for the different capabilities investigated in our study; threshold capabilities, consolidation capabilities, value-adding capabilities and disruption capabilities. Furthermore, the interview questions were carefully translated to Swedish as the interviews were conducted in Swedish. The interview questions are presented in Appendix 1 and 2.

Data Collection

We have conducted interviews with six different small to medium sized international fashion ECCs. Five of the interviews were remote interviews which have been done via telephone where the sixth interview was conducted face-to-face. Face-to-face interviews offer the possibility to capture the interviewees body language and other significant verbal and non-verbal details which otherwise are unnoticed. On the other hand, remote interviews offer more flexibility and less commitment compared to the face-to-face interviews (Easterby-Smith et al., 2018). We are aware of the differences among the different approaches and how those might affect the answers given. However, it was important for us to make sure the interviewees’ needs were met.
There have been several debates regarding what sample size is adequate for a qualitative research (Dworkin, 2012). However, a large number of articles and books suggest that 5 to 50 participants are sufficient (Dworkin, 2012). Additionally, numerous factors have been identified to be important when deciding on the number of participants in a study such as the quality of data, the scope of the study, the nature of the topic as well as the amount of useful information obtained from each participant (Dworkin, 2012). When selecting the number of participants for our study, the factors which contributed to the sample size mostly depended on the amount of useful information obtained from each participant. Moreover, by developing criterions when selecting the participants enabled us to gain interviewees who possessed extensive knowledge regarding our topic. Thus, we found that six interviewees from different companies were sufficient in order for us to gain rich and insightful data to answer our research question. The interviews were conducted between the 18th of March and the 18th of April. In addition, the interviews lasted between 40-50 minutes which depended on the availability of secondary data about the company. Due to convenience for the participants, all the interviews were performed in Swedish. Furthermore, these were recorded, which the parties involved approved, and were transcribed shortly afterwards. After transcribing and analyzing the interviews, some data was found missing which led to us conducting additional shorter telephone interviews with some of the companies.

1 Introduction
1.1 Background
1.2 Problem Statement
1.3 Research Purpose
2 Literature Review
2.1 Evolution of E-commerce
2.2 ECCs in the Fashion Industry
2.3 Internationalization
2.4 Dynamic Capabilities
2.5 Exploitative & Explorative Dynamic Capabilities
2.6 Ambidexterity
2.7 Research Question
2.8 Definitions
3 Methodology & Method
3.1 Methodology
3.2 Method
4 Ethical Consideration & Trustworthiness
4.1 Ethical Consideration
4.2 Trustworthiness & Quality of Research
5 Empirical Findings
5.1 Exploitative Dynamic Capabilities
5.2 Explorative Dynamic Capabilities
6 Analysis & Interpretation of Findings
6.1 Exploitative Dynamic Capabilities
6.2 Explorative Dynamic Capabilities
6.3 Ambidexterity
7 Conclusion
8 Managerial Implications
10 Limitations
12 Further Research
References
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