The Influence of Technology Orientation on Firm Performance: The Mediating Role of Dynamic Capabilities in a Dynamic Pharmaceutical Environment

Abstract

This study investigates how technology orientation influences firm performance through the mediating role of dynamic capabilities within Pakistan’s dynamic pharmaceutical environment. Although the Resource-Based View and Dynamic Capabilities View highlight the importance of strategic resources, limited empirical work integrates technology orientation with capability development. Rapid technological shifts in pharmaceuticals make this linkage critical. A quantitative approach was used, drawing data from 180 pharmaceutical firms. Partial least squares structural equation modeling (PLS-SEM) evaluated direct, indirect, and moderating relationships among technology orientation, dynamic capabilities, firm performance, and environmental dynamism. Technology orientation significantly improves firm performance both directly and by strengthening sensing, seizing, and reconfiguring capabilities. Dynamic capabilities also show a strong positive impact on performance. Environmental dynamism, however, does not significantly moderate the dynamic capabilities–performance relationship. Pharmaceutical firms should invest in both technological advancement and capability-building systems. Future studies should adopt longitudinal designs and cross-industry or cross-national comparisons.