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The effect of project management dynamic capabilities on firm performance

The effect of project management dynamic capabilities on firm performance The purpose of the paper is to shed light on the output of project management (PM) dynamic capabilities Specifically, the study investigates what effect PM dynamic capabilities have on company performance, both directly and indirectly, through the mediation effect of project and portfolio performance. Additionally, it tests whether program performance might also mediate the relationship.Design/methodology/approachThe hypotheses were tested using partial least squares with a sample of 63 international firms that engage in projects globally.FindingsThe main finding of this research is that PM dynamic capabilities do not influence firm performance directly but do so indirectly by increasing firms' performance in projects, programs and portfolios. Both project and portfolio performance have a mediation effect on the relationship between dynamic capabilities and firm performance, but portfolio performance absorbs all this effect when the two performances are in the model.Originality/valueThis paper sheds light on the link between dynamic capabilities and firm performance. It tests the real outcome of dynamic capabilities by making an explicit distinction between firm performance at three intermediate levels (project, program and portfolio) and overall firm performance. Moreover, it opens the black box of dynamic capabilities and empirically operationalizes the theoretical model of sensing-seizing-transforming as the three constituting routines of dynamic capabilities. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Baltic Journal of Management Emerald Publishing

The effect of project management dynamic capabilities on firm performance

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Publisher
Emerald Publishing
Copyright
© Emerald Publishing Limited
ISSN
1746-5265
DOI
10.1108/bjm-06-2021-0218
Publisher site
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Abstract

The purpose of the paper is to shed light on the output of project management (PM) dynamic capabilities Specifically, the study investigates what effect PM dynamic capabilities have on company performance, both directly and indirectly, through the mediation effect of project and portfolio performance. Additionally, it tests whether program performance might also mediate the relationship.Design/methodology/approachThe hypotheses were tested using partial least squares with a sample of 63 international firms that engage in projects globally.FindingsThe main finding of this research is that PM dynamic capabilities do not influence firm performance directly but do so indirectly by increasing firms' performance in projects, programs and portfolios. Both project and portfolio performance have a mediation effect on the relationship between dynamic capabilities and firm performance, but portfolio performance absorbs all this effect when the two performances are in the model.Originality/valueThis paper sheds light on the link between dynamic capabilities and firm performance. It tests the real outcome of dynamic capabilities by making an explicit distinction between firm performance at three intermediate levels (project, program and portfolio) and overall firm performance. Moreover, it opens the black box of dynamic capabilities and empirically operationalizes the theoretical model of sensing-seizing-transforming as the three constituting routines of dynamic capabilities.

Journal

Baltic Journal of Management – Emerald Publishing

Published: Mar 28, 2022

Keywords: Program management; Portfolio management; Project-based learning; Organizational performance; Operational capabilities

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