Relational embeddedness and bop‐oriented dynamic capability—a multi‐case study

Abstract

The Bottom of the Pyramid (BOP) market is composed of a large number of low‐income groups around the world and contains huge wealth that has not yet been discovered. An exploratory multi‐case study was conducted to analyze the impact of relational embeddedness on dynamic capability (DC). On the basis of theoretical presuppositions, based on the intra‐ and inter‐case analysis of six companies in the China BOP market, this paper explores how relational embeddedness affects the DC of companies through exploitative learning and exploratory learning. Twelve research propositions are presented and the theoretical framework of relational embeddedness affecting the DC of enterprises is constructed. The study found that mutual trust and reciprocity norms in the BOP cooperation network can promote the acquisition and utilization of existing knowledge and new knowledge of the enterprise, thereby enhancing the enterprise environmental sensing, environmental adaptive, and environmental shaping capabilities.