Depth of technological capability: a new approach to the technological development of latecomer oil service companies

Purpose: The purpose of this study is to define and develop a new technological development path for latecomer firms in developing countries. Design/methodology/approach: An analytical framework for development based on the technological capability (TC) dimensions is developed and examined in the drilling sector. Since the process of TC accumulation is dynamic, the case study approach is the best method for an exploratory theory-building study. Through a comparative case study of two Iranian drilling contractors, a new path for the technological development of latecomer oil service companies is proposed. Findings: The study of two cases indicates that despite having similar scope and levels of TC, one of them demonstrated superior technical performance. To address this difference, the concept of operational efficiency is introduced which is considered the outcome of increasing the depth of TC. Practical implications: Although upgrading the level of technological and innovation capability is an important path for technological development, latecomers that suffer from various disadvantages can perform their routine activities with superior performance and develop through their basic operational/production capabilities. Also, specialized indicators designed for assessing the level and depth of TC in the drilling industry have important insights for evaluating the technological and competitive position of oil service companies. Originality/value: To the best of the author’s knowledge, this study takes the first step in defining and elaborating on the concept of depth of TC as a development path for latecomers. It also introduced a novel approach to the global operational/production efficiency frontier as a target for their catch-up.