Implementing Capability Development: A study of the external partnernships and internal development mechanisms utilized for capability development

Abstract: The primary purpose of this paper is to further build on research related to capability development in order to explore hindrances and benefits of internal capability development and external partnerships as ways to improve performance. The beverage industry is used as the focus context since the companies in this industry are increasingly responding to external trends and looking for ways to develop their competitive advantage accordingly. Therefore, this study explores the different methods used for capability development to overcome today’s challenges with a focus on technology solutions, innovation, and external trends. The theoretical framework is based on literature related to capabilities and their corresponding process, innovation, the importance of external trends, and capability development implementation modes. generated by adapting to external trends. The study was conducted using a qualitative approach and built its findings based on multiple case studies from five Scandinavian beverage firms, along with perspectives from the Food Technology department of Lund University and an enzyme biotechnology firm. The empirical data used semi-structured interviews and secondary sources related to the industry’s trends and research development strategies to contextualize the research and introduce the main findings of the primary data. The results firstly showcase that external trends have a bilateral relationship to the decisions and strategies companies make concerning internal development and external partnerships, meaning a company has the ability to create a trend through their capabilities as well. Secondly, current capability assessment is vital to decide the process of capability development implementation modes and the corresponding decisions that it entails. Consequently, due to this cyclical process of capability development, the study highlights that the conclusive result from internal development and external partnerships is the enhancement of existing capabilities.