The Dynamic Capabilities Frameworks In The Industrial Economy

The structure-performance paradigm of industrial economy has been one of the most popular conceptual framework models in analyzing competitive advantages of firms. Porter’s Five Forces epitomize these frameworks, which only focus on analyzing suppliers, customers and the threats of a new entry in the market. While these theoretical frameworks have been helpful in providing insightful information, they hardly reveal the prevailing logic of value creation. As a result, new bases of competitive advantage are rapidly gaining popularity due to technological changes that have transformed the global business landscape. The emergence of new models has given a different view of competitive advantage arguing that firms should possess dynamic capabilities to topple others in the industry. According to Teece, Pisano, and Shuen (1997), dynamic capabilities is “the firm 's ability to integrate, build, and reconfigure internal and external competences to address rapidly changing environments,” (p. 516). The Dynamic Capabilities Framework provides a “comprehensive” and “multidisciplinary” approach which is essential in managerial decision-Making. It is the aim of this paper to identify and demonstrate how the dynamic capabilities help to achieve a firm’s competitive …show more content…
Apple has been found to be the paradigmatic practitioner of the Dynamic Capabilities Perspective in its operations. The firm exhibits dynamic capabilities in three core areas: It identifies and evaluates opportunities, mobilizes resources to address and seize the identified opportunity and engages in the continued renewal or transformation. Teece, Pisano, and Shuen (1997) claim that firm which harness and organize these dynamic capabilities builds durable competitive advantages at the enterprise