Successful performance via development and use of dynamic capabilities

Abstract Firms operating the current business environment must respond fast changing conditions and increasing complexity. As this dynamic environment evolves, contemporary are compelled re-assess their strategies, particularly with respect the organizational capabilities from the opportunities the changing environment and sustain competitive advantage. Using the dynamic resource-based view of firms, this study explores the mechanisms, which can be employed by for modern develop organizational dynamic capabilities. The data was collected via focus groups with senior managers of a large public sector organization one of the South-East Asian countries. The results highlights that the organization can sustain its competitive advantage the dynamic environment by maintaining an ongoing learning and training, consultancy and collaboration with key stakeholders, co-creating services for major customers, customers involvement and fostering knowledge exchange within the organization and its business network. Introduction Nowadays corporations are challenged by the dynamic environments with a rapid speed of changes, burgeoning complexity and increased uncertainty. Firms must be able cope with unplanned situations which cannot be predicted advance. As Tsoukas (1996: 22) describes it firms are faced with radical uncertainty: they do not know, they cannot know, what they need know. Hence, organizations are engaged discovering the unknowable and their strategy has assist them this process order enable their manage crises. Management scholars are trying understand how companies cope with environmental changes, what do learn from the changing environment and how the environment affect a firms' learning process (Hitt et al., 1998; Hong, Kianto and Kylaheiko, 2008; Minzberg, 1994; Powel, 1990; Stacy, 1991). These studies agree that turbulent environments do not remain the same state long enough for organizations be able find a favorable competitive position and exploit it (Eisenhardt & Brown, 1998; Fines, 1998). This limited time challenges become resilient external changes. As Hamel and Valikangas (2003: 53) assert, in a turbulent age, the only dependable advantage is a superior capacity for reinventing your business model before circumstances force you to. Achieving resilience is not easy. This view is supported by Eisenhardt (1998) who believes that surviving such fast paced environments, must embed flexibility strategic actions. Undoubtedly, flexibility resource deployment may explain why some move into new niches (Eisenhardt & Martin, 2000). In addition, competitive actions enable develop and sustain their own competitive advantage as well as erode the advantages of competitors (Eisenhardt, 1998; Young et al, 1996). Strategic flexibility also refers the ability of organizations to jump from one opportunity the next, going with the flow of the market (Cunha, 2004: 275). Turbulent environments call for organizations be able detect and create new opportunities and then select those that are worthy of actual resource allocation order be exploited for the firm's benefit (Cunha, 2004: 278). The ability of from new opportunity requires them develop new resources and dynamic capabilities over time rather than protect their unique resources. The purpose of this paper is explore the role of dynamic capabilities of their ability respond the environmental turbulence and sustaining a competitive advantage. The study starts with investigating the role of dynamic capabilities assisting deal with external complexity and uncertainty. It continues by exploring the role of the learning approach and, particularly, the ability of develop new capabilities and acquire resources making effective responses environmental changes. …