(mean profitability ¼ 18.176); these firms seem to be the most successful at turning their capabilities into profitability. Group 3, another relatively high-profitability cluster
(mean profitability ¼ 7.181), also shows a strong relationship between technology and profitability (coeff. ¼ 6.56, p , 0.01). Market linking and marketing also have significant effects on profitability in Group 3 (coeff. ¼ 3.84 and 1.13, respectively).
The results for Groups 1 and 2 are somewhat surprising since only for these two clusters is management capabilities significantly related to profitability. These two groups, both of which are less profitable on average than Groups 3 and 4, are relatively similar in terms of the relationships between capabilities and profitability (profitability ¼ 2.300 and 2.292 for Groups 1 and 2, respectively). For Group 1, marketing capabilities are the most critical, followed by IT capabilities (coeff. ¼ 3.81 and 3.64, respectively, p , 0.01). For Group 2, the two most critical capabilities are IT
and market linking (coeff. ¼ 3.11 and 1.26). In both cases, however, all five capabilities
(including management capabilities) have significant effects on profitability at the p , 0.05 level or better. It is thus interesting to note how the aggregate K ¼ 1 solution masks this structural heterogeneity captured in this K ¼ 4 group solution. In an effort to better describe these derived four groups of US firms, we conducted a number of analyses to examine mean differences between various items.