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The Application of Dynamic Capabilities in E-commerce Innovation Context
---The Implications for Chinese E-commerce companies

Umeå School of Business Umeå University Master thesis Spring 2007

Supervisor: Margareta Paulsson Authors: Chen Yong Jia Liang Wei Min

ACKNOWLEDGEMENT
First of all, we would like to thank our family for their understanding and constant encouragements during our study of Master’s program. And we would also like to thank our friends who helped and supported us during our stay in Umeå. Furthermore, we would like to thank Umeå University for the excellent study environment, professional teaching and friendly atmosphere. And we would also like to thank our supervisor Margareta Paulsson for her great advices and suggestions during our thesis study. Thank you all!

Chen Yong Jia & 31th May, 2007 Umeå, Sweden

Liang Wei Min

i

SUMMARY
This study mainly investigated how Chinese E-commerce companies should cope with E-commerce innovation with specific dynamic capabilities. E-commerce (Electronic Commerce) innovation includes three phases of innovation based on technology and time. They are web-based commerce, mobile commerce (M-commerce) and ubiquitous commerce (U-commerce). They caused not only technological changes but also organizational changes. To cope with E-commerce innovation, a prerequisite is to understand the impacts and changes brought by the innovation. Previous researchers Afuah and Bahram (1995) have proposed a hypercube innovation model to depict the relationship between innovation entities and diverse of participants of innovation value-added chain, forcing enterprises to face what the influence from their innovation will be on their stakeholders. Wu (2004) developed a new hypercube model of E-commerce innovation, explaining that impacts of E-commerce innovation should be based on both internal factors like technological component and business model and external factors like industrial partnerships. Based on the...