The mediation role of companies’ dynamic capabilities for business performance excellence: insights from foreign direct investments

On the 18th of December 2017 at the research workshop in University of Vigo (Spain) associate professor of Economics and Finance Department, research fellow of IDLab Anna Bykova presented the results of joint research with Carlos Jardon entitled “The mediation role of companies’ dynamic capabilities for business performance excellence: insights from foreign direct investments”.

The workshop was organized under ECOBUS program. After the brief introduction of HSE and ID lab, Anna told about the idea of the study, its methodology and results. This study used a combination of multinational enterprises and dynamic capabilities perspectives to illustrate how the involvement of foreign investors is able to contribute to a company’s corporate performance through close relations with foreign partners. Using Russian companies as an empirical sample and applying a partial least squares structural equation modelling (PLS-SEM), hypotheses regarding the impact of dynamic capabilities in terms of absorptive, adaptive and communicative capabilities, on the relationship between foreign ownership and performance, were developed. Findings indicated that dynamic capabilities fully mediate the process of foreign direct investments transformation into firm’s results. In addition, it was discovered that the most powerful indirect effect of dynamic capabilities on value creation belongs to communicative capability, reflecting the pivotal role of effective communication systems.