Retailers Need Dynamic Capabilities to Survive and Thrive

Bob Duffy, Steve Coulombe, Keith Jelinek, and David Teece write about opportunities and threats in the US retail sector. They also discuss how the Dynamic Capabilities framework and its conceptual toolkit can help executives organize and prioritize effort, attention, and financial resources.

The U.S. retail sector is experiencing unprecedented opportunities and threats. Threats come from online shopping and demographic change. Opportunities come from the development and adaptation of digital transformation strategies that integrate physical and virtual shopping in a useful way.

This article uses the Dynamic Capabilities framework and its conceptual toolkit to propose strategies for incumbents and newcomers alike. A capability involves activities that enable an organization to produce particular outcomes. The Dynamic Capabilities framework includes, for analytic and expositional purposes, a distinction between ordinary and dynamic capabilities.