In the previous issue (Vol. 20, Issue 3), we published a perspective article entitled ‘Responsible Research: Reflections of Two Business Scholars Doing Mental Health Research during COVID-19’, by Zhang and Chen. The pair represents two management scholars who ventured into medical research during the COVID pandemic. Zhang and Chen shared their insights from this exploration with the broader community of management scholars, highlighting key differences in how the field of medicine balances the goals of rigor and relevance and judges what research deserves to be published.

MOR's D3 section seeks to stimulate dialogue, debate, and discussion among scholars. When I took over as editor of D3, MOR's editorial team brainstormed how to further develop the D3 feature. We agreed that in addition to seeking original articles, we also wanted to encourage debate on articles that have already appeared in MOR. In this issue, we publish a commentary on Shaalan, Eid, and Tourky's (2022) article ‘De-Linking from Western Epistemologies: Using Guanxi-Type Relationships to Attract and Retain Hotel Guests in the Middle East’. The commentary, entitled ‘Questioning the Appropriateness of Examining Guanxi in a Wasta Environment: Why Context Should Be Front and Center in Informal Network Research’, has been written by Horak, Abosag, Hutchings, Alsarhan, Ali, Al-Twal, Weir, ALHussan, and AL-Husan (2023). As their title suggests, the commentators take issue with transferring the concept of guanxi into an environment in which another idea about informal interpersonal networks, wasta, already exists. I sense that the desire to write a critical comment was fueled by the fact that Shaalan et al. (2022) never referred to the concept of ‘wasta’ in their original article. We invited the authors of the original article to write a rejoinder (Shaalan, Eid, & Tourky, 2023) in which they emphasize even further that they only argue that guanxi-type relationships exist in the Middle East and not that guanxi itself exists.

This essay argues that to assess the likelihood that incumbent firms will successfully make the required transformations to their strategy and operations in the face of technological transformations, it is not sufficient to investigate their dynamic capabilities. Whether an incumbent is likely to succeed in its effort to change itself via dynamic capabilities depends also on how quickly start-ups or diversifying entrants can build ordinary capabilities to offer the new technology at scale. We offer a framework to assess dynamic competition that integrates both ordinary and dynamic capabilities into the analysis by systematically comparing incumbents, start-ups, and diversifying entrants. We illustrate the framework with a case study of electric vehicles and aim to show how crucial such comparative analyses are for making well-founded predictions about the likelihood that incumbents will be able to maintain their leadership positions in the future.

To stimulate a debate about the rise of China's digital economy, this essay compares China and the US in one key area of the digital economy – e-commerce and internet-based services. China still lags behind the US in internet penetration, but it distinguishes itself by building a mobile-first, fiber-intensive, and inclusive digital infrastructure. A favorable infrastructure, innovations tailored to the large Chinese market, and local firms’ rapid commercialization of products and services turned the world's largest domestic population into active online consumers, helping China overtake the US by a large margin in retail e-commerce and digital payment. While China translated digital technologies into leading business-to-customer and customer-to-customer businesses, it has not been so successful in business-to-business services. The US is still ahead in the general-purpose technologies underlying the digital economy.

Past studies have shown that the flow of knowledge from incumbent firms is associated with the creation of startups and their subsequent performance. While much research has focused on the mechanisms of how incumbent-to-startup knowledge transfer takes place, such as entrepreneurs pursuing opportunities that their previous employers do not want to pursue, we explore with detailed qualitative analysis of six private startups in the Chinese synthetic-dye industry what type of knowledge actually flows and what type is more important for the long-term success of startups. We discover eight types of knowledge that flow from incumbents to new firms during the foundation of startups. Abstracting these eight types of knowledge into two general categories of functional knowledge and strategic knowledge, we find the reception of strategic (not functional) knowledge shapes the long-term competitiveness of surviving startups. Receiving technical knowledge – one type of functional knowledge – during the founding period is necessary for startups’ short-term survival but insufficient for long-term success. Our findings show that the performance implications of initial knowledge flows from incumbents hinge on the type of knowledge, contributing to a more explicit explanation of how incumbent-to-startup knowledge flows affect entrepreneurial performance.

It is of interest in China and across the world to predict whether China will catch up with the most economically advanced nations in innovation capacity. To facilitate an ongoing assessment of China's innovation capacity, the article develops a China Innovation Capacity Growth Index composed of eight separate measures. China's performance in 2020 is compared to the baseline from 2015, showing that China has progressed in six of the eight measures. This article and the accompanying Technical Appendix explain each of the measures, including the sources for the data, and report the changes in performance over time.