A dynamic view on strategic resources and capabilities applied to an example from the manufacturing strategy literature

Purpose - The purpose of this paper is to demonstrate the usefulness of a dynamic analysis of the development and management of strategic capabilities and resources in manufacturing. It aims to present dynamic resource/capability systems as a means to understand an issue from manufacturing strategy. Design/methodology/approach - A case study from a standard textbook on manufacturing strategy is used to illustrate the approach that is mainly based on Warren's strategy dynamics. Extensions to this approach are introduced. Findings - Diagrams of dynamic resource/capability systems are valuable tools for understanding issues of interconnected and changing strategic resources and capabilities. Resources and capabilities can be interpreted as stocks in dynamic simulation models following ideas from system dynamics. Research limitations/implications - The exact nature of strategic capabilities and their relationships needs to be further investigated. Approaches need to be developed to measure and to quantify these concepts. The connection between Hill's order winners/qualifiers and the inflows/outflows of capability and resource stocks should be further examined. Practical implications - Static analyses of strategic issues are often difficult to interpret. The dynamic nature of strategic issues needs to be reflected in the tools used for analysing them. Originality/value - Applies a dynamic analysis to manufacturing strategy and uses a textbook example in a new way to illustrate the relevance of the approach.