How to create dynamic capabilities: A design science study

Abstract

Dynamic capability (DC) theories are widely used by innovation scholars, but there is little empirical work that applies these theories in ways that can be used by practitioners. Moreover, DC studies tend to suffer from tautological issues when measurements of DC overlap with those of firm performance. To fill this void, this paper explores how scholars can help companies in creating a dynamic capability. We adopt a design science approach in which scholars and practitioners team up to address and resolve a focal firm's (micro-DC) challenge in managing a large number of product development projects that run simultaneously but all depend on the same resource pool. To address this challenge, we design and implement a process technology tool. This study thus demonstrates how one can solve a real-life DC challenge by developing a practically relevant solution, based on design science.