When Dynamic Capabilities Don’t Deliver: Investigating Negative or Null Performance Outcomes

Most studies, such as Zhang et al. (2024) and Arun & Ozmutlu (2021), reinforce the idea that dynamic capabilities generally lead to improved performance. However, what about the exceptions—organizations that invest in dynamic capabilities yet experience stagnant or declining results? This project proposes a comparative case study of firms where dynamic capabilities lead to unexpected or negative outcomes, controlling for context (sector, environmental munificence, etc.). Building on the “investigate deviations from expectations” heuristic, this research will seek to identify contextual moderators (e.g., resource scarcity, poor leadership alignment, cultural resistance) that can turn dynamic capabilities into liabilities. This could radically refine the predictive power and boundaries of dynamic capabilities theory.

References:

1. Assessing the Dynamic Capabilities and Sustainable Performance in Public Hospital Supply Chains Management. Tongtong Zhang, Jamaliah Said, Nor Balkish Zakaria, Yvonne Joseph Ason (2024). Malaysian Journal of Social Sciences and Humanities.
2. Narratives of environmental munificence of 3PL firms on the relationship between dynamic capabilities, strategic management and organizational performance. K. Arun, Saniye Yildirim Ozmutlu (2021). Journal of Strategy and Management.