What are dynamic capabilities and how do they differ from static Essay

What are dynamic capabilities and how do they differ from static capabilities - Essay Example It is basically hands on situation where a problem arise you solve it without having any planned solution in mind. This means that although knowledge may exist in people it can only be expressed within the organisation. As Winter said 'firms are organisations that know how to do things' (Winter, 1988, p.175). Winter is emphasizing the importance of being a part of an organization that is you are most likely to tackle a problem depending on the situation. Tacit knowledge is tough to replicate or imitate. If possible, it can only be transferred through teaching by example, and then this is only the case with knowledge which is observable. Thus this makes an organisational capability into a source of maintaining competitive advantage. Dynamic capabilities, as known today, are a set of specific and identifiable processes such as product development or strategic decision making with expected outcomes. They are detailed, analytic and stable processes for globalized manufacturing companies to continuously improve their performance and gain competitive advantage through establishing new plants and shutting down non-performing units. Thus dynamic capability is "a learned and stable pattern of collective activity through which the organization systematically generates and modifies its operating routines in pursuit of improved effectiveness" (Zollo and Winter, 2002). This proves that dynamic capabilities are procedures and understandings that help organizations to develop more competent practices and search for more efficient technologies, new or improved products and manufacturing process. According to Teece, Pisano and Shuen, many strategy scholars remain doubtful about the value of the concept of "dynamic... Dynamic capabilities, as known today, are a set of specific and identifiable processes such as product development or strategic decision making with expected outcomes. They are detailed, analytic and stable processes for globalized manufacturing companies to continuously improve their performance and gain competitive advantage through establishing new plants and shutting down non-performing units. Thus dynamic capability is â€Å"a learned and stable pattern of collective activity through which the organization systematically generates and modifies its operating routines in pursuit of improved effectiveness†. This proves that dynamic capabilities are procedures and understandings that help organizations to develop more competent practices and search for more efficient technologies, new or improved products, and manufacturing process. According to Teece, Pisano, and Shuen, many strategy scholars remain doubtful about the value of the concept of â€Å"dynamic capabilities.† Though it is seen as a key to competitive advantage, critics rather believe that they are born and not made meaning they are skeptical about them being the intentional genuine option for managers instead. However one can only accept this proposal productive only if it is widely adopted.