This paper focuses on dynamic capabilities and, more generally, the resource-based view of the firm. We argue that dynamic capabilities are a set of specific and identifiable processes such as product development, strategic decision making, and alliancing. They are neither vague nor tautological. Although dynamic capabilities are idiosyncratic in their details and path dependent in their emergence, they have significant commonalities across firms (popularly termed ‘best practice’). This suggests that they are more homogeneous, fungible, equifinal, and substitutable than is usually assumed. In moderately dynamic markets, dynamic capabilities resemble the traditional conception of routines. They are detailed, analytic, stable processes with predictable outcomes. In contrast, in high-velocity markets, they are simple, highly experiential and fragile processes with unpredictable outcomes. Finally, well-known learning mechanisms guide the evolution of dynamic capabilities. In moderately dynamic markets, the evolutionary emphasis is on variation. In high-velocity markets, it is on selection. At the level of RBV, we conclude that traditional RBV misidentifies the locus of long-term competitive advantage in dynamic markets, overemphasizes the strategic logic of leverage, and reaches a boundary condition in high-velocity markets. Copyright © 2000 John Wiley & Sons, Ltd.

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Dynamic capabilities, what are they?

Researchers have used the absorptive capacity construct to explain various organizational phenomena. In this article we review the literature to identify key dimensions of absorptive capacity and offer a reconceptualization of this construct. Building upon the dynamic capabilities view of the firm, we distinguish between a firm's potential and realized capacity. We then advance a model outlining the conditions when the firm's potential and realized capacities can differentially influence the creation and sustenance of its competitive advantage.

https://ink.library.smu.edu.sg/cgi/viewcontent.cgi?article=5629&context=lkcsb_research

Absorptive Capacity: A Review, Reconceptualization, and Extension

This article introduces the concept of the capability lifecycle (CLC), which articulates general patterns and paths in the evolution of organizational capabilities over time. The capability lifecycle provides a structure for a more comprehensive approach to dynamic resource-based theory. The analysis incorporates the founding, development, and maturity of capabilities in a manner that helps to explain the sources of heterogeneity in organizational capabilities. In addition, the analysis includes the "branching" of an original capability into several possible altered forms.

The Dynamic Resource-Based View: Capability Lifecycles

This article introduces the concept of the capability lifecycle (CLC), which articulates general patterns and paths in the evolution of organizational capabilities over time. The capability lifecycle provides a structure for a more comprehensive approach to dynamic resource-based theory. The analysis incorporates the founding, development, and maturity of capabilities in a manner that helps to explain the sources of heterogeneity in organizational capabilities. In addition, the analysis includes the ‘branching’ of an original capability into several possible altered forms. Copyright © 2003 John Wiley & Sons, Ltd.

The dynamic resource-based view: capability lifecycles

Agility is vital to the innovation and competitive performance of firms in contemporary business environments. Firms are increasingly relying on information technologies, including process, knowledge, and communication technologies, to enhance their agility. The purpose of this paper is to broaden understanding about the strategic role of IT by examining the nomological network of influences through which IT impacts firm performance. By drawing upon recent thinking in the strategy, entrepreneurship, and IT management literatures, this paper uses a multitheoretic lens to argue that information technology investments and capabilities influence firm performance through three significant organizational capabilities (agility, digital options, and entrepreneurial alertness) and strategic processes (capability-building, entrepreneurial action, and coevolutionary adaptation). We also propose that these dynamic capabilities and strategic processes impact the ability of firms to launch many and varied competitive actions and that, in turn, these competitive actions are a significant antecedent of firm performance. Through our theorizing, we draw attention to a significant and reframed role of IT as a digital options generator in contemporary firms.

/pdf/shaping-agility-through-digital-options-reconceptualizing-ls4ufpmoi1.pdf

Shaping agility through digital options: reconceptualizing the role of information technology in contemporary firms

This article provides a conceptual model that explains how the coevolution of organizational knowledge, capabilities, and products over long time spans can result in competitive advantage through innovation and strategic linkage of products at a point in time and over time. At the heart of the model are sequences of products within and across markets, supported by an underlying system of knowledge and systems of learning. This dynamic model brings the importance of the products themselves, supported by vertical chains of activities, into the analysis of resource and knowledge-based competitive advantage. The model also suggests that we can think about the evolution of firms, and by implication the evolution of industries, not only in terms of knowledge and capabilities, but also in terms of vertical chains and products. Short company histories illustrate the workings of the model. Copyright © 2000 John Wiley & Sons, Ltd.

Product sequencing: co-evolution of knowledge, capabilities and products

This paper provides a conceptual model that explains how organizational knowledge, capabilities, and products co-evolve over long time spans, and how this can result in competitive advantage through innovation and strategic linkage of products at a point in time and over time.

Product Sequencing: Co-Evolution of Knowledge, Capabilities and Products

Dynamic and integrative capabilities for profiting from innovation in digital platform-based ecosystems

This paper provides a conceptual model that explains how organizational knowledge, capabilities, and products co-evolve over long time spans, and how this can result in competitive advantage through innovation and strategic linkage of products at a point in time and over time. At the heart of the model are sequences of products within and across markets, supported by an underlying system of knowledge and systems of learning. This dynamic model brings the importance of the products themselves, supported by vertical chains of activities, into the analysis of resource and knowledge-based competitive advantage. The model also suggests that we can think about the evolution of firms, and by implication the evolution of industries, not only in terms of knowledge and capabilities, but also in terms of vertical chains and products. Short company histories illustrate the workings of the model.

https://papers.ssrn.com/sol3/Delivery.cfm/000725358.pdf?abstractid=237288

This paper presents a model of product proliferation by multiproduct firms. Firm behavior is based on a two-stage process in which there is centralized decision making in new product introductions and decentralized management of existing products. In equilibrium, the number of products each firm has, as well as its total profits, are inversely related to the cost of introducing a new product and to the number of firms in the market. But, as the number of rivals increases, the total number of products in the market increases, although total industry profits decrease. Copyright 1987 by Blackwell Publishing Ltd.

Ruth S. Raubitschek

Papers

Product sequencing: co-evolution of knowledge, capabilities and products

Product Sequencing: Co-Evolution of Knowledge, Capabilities and Products

Dynamic and integrative capabilities for profiting from innovation in digital platform-based ecosystems

Product Sequencing: Co-Evolution of Knowledge, Capabilities and Products

A Model of Product Proliferation with Multiproduct Firms