Toward an integrated framework for innovation in service: A resource-based view and dynamic capabilities approach

Organizations today desire strategies that place them on the frontiers of service innovation. In this research, we provide a novel research framework that incorporates resources and capabilities and how they affect elements of service innovation. This research draws on the resource-based view of the firm to define firm's internal resources and outside (i.e., relational) capabilities. Because firms compete in a dynamically changing market, we introduce dynamic service capabilities as three distinct processes that allow resources and relational capabilities to affect components of service innovation. Three propositions are introduced in addition to specific examples of promising future empirical work using service-oriented firms. This study aims to contribute to service innovation through a theoretical foundation in which we posit how firms develop their service innovation through a dynamic service capabilities framework. Contributions to theory and practice are discussed in addition to limitations to the study.