This study investigates the relationship between organisational embeddedness, capabilities,
and organisational performance in the Australian context. The mail survey method was used
to collect data from 420 Senior Executives in charge in making strategic decisions within the
Australian firms. The effective response rate was 34.8%. The results indicate that in general,
organisational embeddedness has partial direct impact on organisational capabilities.
Organisational capabilities mediate the organisational embeddedness and performance
linkages. The results further suggest that the learning orientation is significantly related to
organisational performance. The results emphasise the importance of the sociological factors
in determining organisational performance and potentially as explanations for organisational
actions and performance.