Dynamic capabilities and strategic management

The text, an excerpt from the seminal 1997 Strategic Management Journal article "Dynamic capabilities and strategic management" by David J. Teece, Gary Pisano, and Amy Shuen, proposes the dynamic capabilities framework as a means to understand how firms create and maintain competitive advantage in environments marked by rapid technological change. This framework argues that long-term success flows not from strategic maneuvers against competitors (strategizing), but from internal organizational and managerial processes that allow a firm to effectively coordinate, learn, and reconfigure its asset positions and evolutionary paths. The authors compare this capabilities approach against established strategy paradigms, such as the competitive forces and strategic conflict models, highlighting that competitive advantage is rooted in difficult-to-imitate, firm-specific competences that must be built rather than simply bought. The discussion emphasizes that a firm's unique competitive advantage is derived from its processes, positions, and paths, which collectively influence its ability to adapt and innovate over time.