The ambidextrous interaction of RBV-KBV and Regional Social Capital and their impact on SME management

This paper presents the argument that regional culture, encompassed within intricate forms of social capital, is inextricably linked to the resource-based view (RBV) concept—which is focussed on any inimitable resources possessed by a firm. These encompass knowledge (which pertains to the knowledge-based view – KBV)—including the cultural knowledge and understandings that are specific to a given region—as a key resource that is available to a firm and contributes to make it competitive. This paper presents the conceptual development of the RBV-KBV within an organizational ambidexterity framework and highlights how regional context, the RBV-KBV, and firm dynamics inter-operate. By so doing, it responds to the call to fill an important gap in the literature, underscoring the vital role of the regionally contextualised RBV-KBV. Rather than viewing these contexts as taken-as-given entities, it is important to see them as culturally, socially, and historically constructed and rooted phenomena. Drawing empirically on a series of semi-structured interviews conducted with German manufacturing SMEs in the Baden-Württemberg (BW) region (SW Germany), our study provides novel insights into how SMEs manage resources and regional social capital in order to expand judiciously into international (emerging) markets. In so doing, it presents a novel conceptual ambidextrous organizational framework that shows how companies move from a traditional exploitative and conservative form of regional cultural RBV-KBV to a more explorative and innovative internationalising one. Further, our study also contributes fresh insights into the explorative ‘hidden champions’ phenomenon by showing how the latent BW conservative RBV-KBV and its regional social capital-informed exploitative postures act as persistent moderating drivers of explorative internationalisation.