Dynamic Capabilities and Strategic Management

David J. Teece, Gary Pisano, Amy Shuen. Strategic Management Journal.

Open DOI

Commented abstract

The paper allows organisational capability to be discussed without reducing it either to individual talent or to the mere endowment of resources. Its thesis is that, in changing environments, advantage depends not only on what the firm possesses but on its capacity to integrate, build, and reconfigure internal and external competences.

Structured commentary

Introduction

The contribution of Teece, Pisano, and Shuen consists in having shifted the axis of strategic analysis from the endowment of resources to the capacity to recombine them. In environments subject to change, competitive advantage does not rest on what the firm holds at a given moment but on its aptitude for integrating, building, and reconfiguring competences. For the small firm the distinction is anything but abstract: numerous firms appear capable so long as the owner personally compensates for every friction, and reveal their fragility as soon as volume, complexity, or the absence of a key figure test the effective transferability of the work.

The MARTRO reading must draw on the paper to separate personal power from organisational capability. A capacity is organisational only when it survives delegation, repetition, and change of context. If a commercial process functions because a particular person remembers all the exceptions, one is not yet in the presence of a capability but of a tacit dependency. When, on the contrary, the work is sustained by roles, data, minimal standards, decision rights, and revision routines, the firm begins to possess a capacity able to scale without consuming the entire cognitive margin of the leadership.

Such a distinction directly supports the diagnostic orientation. The inquiry must not confine itself to noting which resources are lacking but must establish where what the firm believes it knows how to do actually resides: in a person, in a procedure, in a series of unintegrated tools, in a relationship with a supplier, in a tacit practice never formalised. Each answer configures a different risk. The paper thus provides the basis for converting the word "capability" into an observable and discussable object.

It should further be clarified that dynamic capabilities are not synonymous with generic agility. Frequent change is not in itself an index of the capacity to change; it may signal, on the contrary, the absence of standards. A small firm that continually alters its priorities without consolidating learning is perhaps reacting, not reconfiguring. Dynamic capability presupposes an underground continuity — legible signals, responsibilities, choice mechanisms, an aptitude for incorporating change into new routines — in the absence of which adaptation reduces to recurrent heroism.

The editorial boundary is sharp: the source must not be employed to promise competitive advantage, nor to certify a firm's adaptivity. It grounds a lens — the observation of the minimal conditions under which an organisation can reconfigure itself — whose proof lies not in theoretical citation but in episodes: what happens when a client changes its requests, a supplier slows, a role is absent, a process grows in volume. It is in such junctures that the declared capability becomes verifiable or reveals itself as mere personal dependency.

Why it matters for MARTRO

it distinguishes personal power from organisational capacity, defining the latter as what survives delegation, repetition, and change of context.

Limits and boundaries of use

it is a high-level strategic category; it must be brought back to episodes and artefacts to become observable.

it promises no competitive advantage and certifies no adaptivity; it grounds an observational lens.

Practical application for SMEs

establish where a declared capability "resides" — person, procedure, tool, relationship — and what risk follows.