Microfoundations of Organisational Capabilities: Individual Cognition, Social Interaction, and Capability Emergence in Nigerian Firms

This study investigates the microfoundations of organisational capabilities by examining how individual cognition and social interaction processes drive capability emergence and development in Nigerian firms, contributing an original micro-process theory to the capabilities literature. Organisational capability research has predominantly operated at the firm level, treating capabilities as black-box constructs while leaving the individual and social processes through which capabilities emerge theoretically underspecified. This is particularly limiting in the Nigerian context where informal networks, ethnic group dynamics, and hierarchical authority structures significantly shape knowledge sharing and capability-building processes. Employing a multi-level mixed-methods design, this research combines survey data from 280 managers and employees across twelve firms in diverse Nigerian industries with ethnographic observation of team-level knowledge practices in four focal firms. Hierarchical linear modelling analyses the multi-level quantitative data, while interpretive process analysis of the ethnographic material develops theoretically-grounded micro-process propositions. The study identifies three novel micro-mechanisms of capability emergence: cognitive schema alignment through repeated social interaction, informal authority networks as capability coordination structures, and culturally-embedded knowledge sharing norms as capability generativity conditions. These mechanisms extend the microfoundations programme in strategy research into the African institutional context and generate transferable theoretical propositions with implications for capability development practice and management education in Nigeria. Keywords: microfoundations, organisational capabilities, cognition, social interaction, Nigeria.