David teece was the pioneer of the dynamic capabilities perspective. David teece writes about business model innovation, implementation, and change. Since dynamic capabilities may also reflect the unique experiences, intuition, and cognition of key managers, new executives may need to join the firm to turn a ship that has run aground. Teece et al 1997 is the single most cited paper in business and economics from 1995 to 2005 according to thomsons sciencewatch.
This paper draws in part on teece 2007 and on baranskaya and teece forthcoming. Dynamic capabilities are necessary, but not sufficient, conditions for competitive advantage. Secondorder dynamic capabilities interest in dynamic capabilities stems from their potential for enhancing organizational performance outcomes. Teece1, gary pisan02 and amy shuen3 haas school of business, university of california, berkeley, california, u. David teece uncertainty, innovation, and dynamic capabilities. However, dcs only begun to attract greater attention after the publication of.
Dynamic capabilities may sometimes be rooted in certain change routines e. Based on and expanding upon the resourcebased view of the firm, its founding paper by david j. This management theory was defined by david teece, gary pisano, and amy shuen in their 1997 paper dynamic capabilities and strategic management. The concept that is still new and contemporary has attracted many arguments that may lead to confusion. This study develops an external dynamic capabilities. Coase 1937 pointed out that the most obvious cost of organizing production through the marker mechanism is that of discovering what the relevant prices. Dynamic capabilities and organizational performance. Since the concept of dynamic capabilities was first introduced, much. Interrelations and impact on firm performance jurgita. The issue aims to bring together scholars and practitioners to help lead organizations to higher levels of performance. Dynamic capabilities, the scope of strategy, and lean dynamic capabilities framework is a promising framework for strategic management. The competitive advantage of firms is seen as resting on distinctive processes ways of coordinating and combining, shaped by the firms specific asset positions such as the firms portfolio of. Dynamic capabilities as such consist of a broad range of activities, including new product development, business model innovation, and alliance formation. Innovation, dynamic capabilities, and leadership 17 since these will at best develop capabilities that are congruent with current operations or orientations in the firm at time when new incongruent ones are needed.
Teece, gary pisano, and amy shuen, dynamic capabilities and strategic management 1997, has been cited in almost. Dynamic capabilities is now a wellestablished framework for guiding research and practice in the field of strategic management. In organizational theory, dynamic capability is the capability of an organization to purposefully adapt an organizations resource base. Dynamic capabilities and strategic management teece 1997. The concept of dynamic capabilities dcs is gaining popularity in management field particularly in strategic management. Creating competitive advantage in innovation via external resource renewal abstract. Business model innovation and organizational design. Dynamic capabilities are the firms capacities to integrate, build, and reconfigure internal and external resourcescompetences to address and shape rapidly changing business environments teece et al. Download product flyer is to download pdf in new tab. Understanding resources, competences, and capabilities in eu. Innovation, dynamic capabilities, and leadership paul j. As a practical matter, the choices depend, in part, on the strength of the firms dynamic capabilities teece et al. Pdf dynamic capabilities and entrepreneurial management.
Risk, uncertainty, and strategy in the innovation economy. The concept was defined by david teece, gary pisano and amy shuen, in their 1997 paper dynamic capabilities and strategic management, as the firms ability to integrate, build, and reconfigure internal and external competences to address rapidly changing. Teeces seminal paper with pisano and shuen in 1997 which is based on the early. Google books dynamic capabilities and strategic management.
Dynamic capability is the firms ability to integrate, build, and reconfigure internal and external competences to address rapidly changing environments david j. The organizational dimension, edited by nicolai foss. This book includes a number of essays about the dynamic capabilities framework teece et al. Understanding the concept of dynamic capabilities by. Dynamic capabilities and strategic management david j. Towards a prescriptive theory of dynamic capabilities. The dynamic capabilities framework analyzes the sources and methods of wealth creation and capture by private enterprise firms operating in environments of rapid. Still other scholars proposed that dynamic capabilities may hurt rather than improve. Toward a prescriptive theory of dynamic capabilities. The dynamic capabilities view posits that a firms success is largely driven by its ability to adapt to a changing environment to secure value creating potential and, thus achieve a competitive advantage. A dynamic capabilitiesbased entrepreneurial theory of the.
It is grounded in 25 years of his research, teaching, and consultancy. It is about how dynamic capabilities directely related to strategic management ultimately achieving and sustaining competetive advantage. While some see dynamic capabilities as the key to competitive advantage teece, pisano, and shuen, 1997, others seem to doubt that there actually are such things. Teece argues that dynamic capabilities can enable the firms to create and capture value by designing appropriate business models 17.
An early definition of dynamic capabilities was the firms. Dynamic capabilities theory proposed by teece and pisano 1994 is the extension from resourcebased view rbv of the firm barney. Because these challenges arise from empirical events in realworld environments, they are handson challenges, not theoretical ones. Pdf understanding the concept of dynamic capabilities by. The authors propose a theoretical model for the relationship among dynamic capabilities dimensions in order to explain how firms achieve and sustain competitive advantage, and also present the. However, the dynamic capabilities approach is still very much in its infancy and has yet to yield a testable theory. Dynamic capabilities and strategic management by david j teece. Dynamic capabilities theory proposed by teece and pisano 1994 is the extension from resourcebased view rbv of the firm barney, 1986barney, 1991. Oxford handbook of dynamic capabilities oxford handbooks. The dynamic capabilities framework conjectured that firmlevel differences in capabilities were rooted in three factors. Exploring links between dynamic capabilities perspective. The concept of dynamic capabilities arose from a key shortcoming of the resourcebased view of the firm.
Connecting strategic choice, learning, and competition working paper draft 3. Creating, adapting to, and exploiting change is inherently entrepreneurial. The dynamic capabilities approach provides a coherent framework to integrate existing conceptual and empirical knowledge, and facilitate prescription. Dynamic capabilities include difficulttoreplicate enterprise. Teece, pisano and shuen 1997 introduction the concept of dynamic capabilities dcs that is the extension of resourcebase view rbv for its ability to respond to rapidly technological change teece, 2007 is gaining greater attention. What are dynamic capabilities and its role in strategic.
Teece institute for business innovation haas school of business university of california, berkeley september 15, 2010 based on explicating dynamic capabilities. This paper focuses on dynamic capabilities and, more generally, the resourcebased view of the. Dynamic capabilities can be distinguished from operational capabilities, which pertain to the current operations of an. Dynamic capabilities, the scope of strategy, and lean. Pdf dynamic capabilities and strategic management david. The capacity of an organization to create, extend, or modify its resource base is vital. Dynamic capabilities consist of knowledge accumulation and. While prior research has examined how firms internally transform their resource base to develop new innovations, less is known about external paths of resource renewal. Dynamic capabilities and strategic management by david j teece free download as powerpoint presentation.
Business models and dynamic capabilities sciencedirect. Dynamic capabilities theory proposed by teece and pisano 1994 is the extension from resourcebased view rbv of the firm barney, 1986barney. An extensive literature on dynamic capabilities now exists e. The concept was defined by david teece, gary pisano and amy shuen, in their 1997 paper dynamic capabilities and strategic management, as the firms ability to integrate, build, and reconfigure internal and external competences to address rapidly. The dynamic capabilities framework analyzes the sources and methods of wealth creation and capture by private enterprise firms operating in environments of rapid technological change. Dynamic capabilities have been defined as the ability to integrate, build, and reconfigure internal and external competencies to address rapidly changing environments. Pdf dynamic capabilities and digital platform lifecycles. We also argue that dynamic capabilities can be used.
Teece, 2007, which increasingly provides an intellectual infrastructure for both theoretical and applied analyses of strategic management and other. Dynamic capabilities allow organizations to sense changing requirements, select new capability configurations and transform their resource sets and routines teece, 2007. Abstract the dynamic capabilities framework analyzes the sources and methods of wealth creation and capture by private enterprise firms. The oxford handbook of dynamic capabilities edited by david j. This logic suggests a mediation model, with firstorder dynamic capabilities mediating the impact of secondorder dynamic capabilities on performance. Firms with weaker dynamic capabilities, to the extent that they even recognize a new opportunity, will be more likely to adopt business models that lean on past investments and existing organizational processes.
The role of dynamic capabilities as drivers of business. David teece provides an introduction to a special issue on dynamic capabilities. Martin department of management science and engineering, stanford university, stanford, california, u. Teece is identified as being partially responsible for the dynamic capabilities perspective in strategic management. But the dynamic capabilities approach recognizes the fungiblity of.
Enterprises with strong dynamic capabilities are intensely entrepreneurial. Teece, gary pisano, and amy shuen dynamic capabilities can be distinguished from operational capabilities, which pertain to the current operations of an organization. Designing organizations for dynamic capabilities presents new challenges for managers and entrepreneurs. Dynamic capabilities, innovation and organizational. To survive and prosper under conditions of change, firms must develop the dynamic capabilities to create, extend, and modify the ways in which they operate. Dynamic capabilities, innovation and organizational learning. Responding to this gap, teece and pisano 1994 and teece et al.
If a firm possesses vrin resources but does not use any dynamic capabilities, its superior returns cannot be sustained. Similarly, zott 2003 maintained that dynamic capabilities are not directly linked to. Dynamic capabilities as workable management systems theory. Organizing for innovation and growth, oxford university press 2009. Dynamic capabilities and strategic management teece. Understanding the concept of dynamic capabilities by dismantling. Dynamic capabilities can be distinguished from operational capabilities, which pertain to the current operations of an organization. Dynamic capability can be defined as the inherent capability of the organization to optimally and purposefully adapt and catapult the organizations resource base. Figgie professor of business administration harvard business school this paper is an extension revision of manuscript originally entitled a normative theory of. The limitations of dynamic capabilities harvard business school. Fundamentals of business strategy, six volume set, mie augier and david j. A more holistic perspective is provided by the dynamic capabilities framework, which takes a systemlevel approach to the resources, capabilities, and management of the firm and its business environment teece 2018. Still others believe that they exist, but suspect that they are born, not madei. Elements of the approach can be found in schumpeter 1942, penrose 1959, nelson and winter 1982, prahalad and hamel 1990, teece 1976, 1986a, 1986b, 1988 and.
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