Leveraging dynamic capabilities: a contingent management control system approach

Dynamic capabilities help explain why some organizations survive overtime. However, they have been mostly viewed as abstract phenomena with limited attention given to the mechanisms that managers might use to create and direct them. In this chapter, we present a model that explains how contingent management control systems leverage the organizational behaviors necessary for dynamic capabilities. We focus on how variations in environmental velocity affect the characteristics of the feedback that these systems receive. This, in turn, influences control system emphasis and the paradoxical forces of exploitation and exploration that guide and direct the capability processes of coordination/integration, learning and reconfiguration. © Stuart Wall, Carsten Zimmermann, Ronald Klingebiel and Dieter Lange 2010. All rights reserved.