Know Your Game : An explorative study of dynamic capabilities’ potential impact on the Swedish video game industry

Abstract: Video games have grown from only being a hobby activity to a worldwide industry, where the Swedish video game industry has become an increasingly important driver to this growth. However, there has been little research on the video game industry, where most empirical studies have so far focused on the involvement of users in product development and on mutually exclusive technology. To create a better understanding of this rapidly growing industry and move closer to determine what makes a game successful, research need to take into consideration the impact that dynamic capabilities have on game development. Therefore, this study aims to examine the dynamic capabilities of video game firms in Sweden in terms of knowledge, and if these are related to the product performance. We argue that product performance could be positively affected by four different knowledge sources: market knowledge, project team, counterpart and communities. A survey strategy was used that resulted in 102 observations from the Swedish video game industry. The regression analysis shows that market knowledge is positively related to product performance, while the other three knowledge sources show no significance. The findings contribute with more knowledge on how video game firms manage their dynamic capabilities, thus complementing previous studies and literature.