T H E O R I E S O F S T R AT E G Y · M S C B A S T R AT E G Y · U VA
Session 5.2
The Dynamic Capabilities View
The resource-based view III — the “Low Church” and its evolutionary
foundation
Teece, Pisano & Shuen (1997) Stoelhorst & Bridoux (2015) Lecture 10 slides
2020-21 DCV clip Lecture notes & reading guide
Contents
1 Where 5.2 fits in the course 8 Generalized Darwinism: evolutionary logic
2 The big picture: from positional to dynamic 9 Stoelhorst & Bridoux (2015)
3 Teece, Pisano & Shuen (1997) 10 The 3R configuration & FAF
4 Processes, positions & paths 11 Positional vs temporal advantage
5 Teece: imitation, economizing & advice 12 Case: Amazon · principles · study question 10
6 The critique of the DCV 13 Links to the rest of the course
7 Winter: capabilities & routines 14 Definition list
Lecture / big picture Teece et al. (1997) Evolutionary theory & Winter Stoelhorst & Bridoux (2015) Exam tips
Study summary prepared for Nikki · exam 12 October 2026 · Based on the course readings, Lecture 10 (“The Resource-based
View III: The Low Church – Dynamic Capabilities”), the prerecorded DCV slides, the Reading Guide, the Study Guide and your
own lecture notes.
Theories of Strategy · Session 5.2 · Dynamic capabilities view
, 1 · Where Session 5.2 fits in the course
Session 5.2 is the third and last RBV meeting and the most ambitious attempt in the course to build a truly
dynamic resource-based theory. The Reading Guide calls the dynamic capabilities work influential but
“ultimately unsuccessful” as a theory, and the meeting therefore has two halves: (1) the seminal DCV paper
by Teece et al. (1997) and its problems, and (2) a proposal to repair it by grounding it in evolutionary logic
(Stoelhorst & Bridoux, 2015).
Block 3 — Dynamic views Key concepts for 5.2 (Study Guide)
4.1 Schumpeterian view I — dynamics, uncertainty, Dynamic capabilities
profit Processes, positions, and paths
4.2 Schumpeterian view II — expectations, creative Positional vs. temporal competitive advantage
destruction
Variation – selection – retention
5.1 RBV II — Low Church: knowledge & capabilities
Adaptive fit
5.2 RBV III — Low Church: dynamic capabilities ◀ Stoelhorst & Bridoux’s 3Rs
you are here
6.1 Schumpeterian view III — competitive dynamics,
increasing returns
6.2 Schumpeterian view IV — technology-driven
industries
The RBV family (Lecture 10, slide 7)
“High Church” “Low Church”
equilibrium logic · resource picking disequilibrium · capability building
Factor market competition Capabilities view — Dierickx & Cool 1989
Barney 1986
Knowledge-based view — Grant 1996
Core RBV (Ricardian rent)
Barney 1991 · Peteraf 1993 · Peteraf & Barney 2003
Dynamic capabilities view — Teece et al. 1997
Popular versions: Prahalad & Hamel’s (1990) core competencies; Stalk et al. (1992) organizational capabilities. Terminology High/Low
Church from Gavetti & Levinthal (2004).
KEY MESSAGE CARRIED OVER FROM 5.1
Complementarities: excellence is in the system, not in its parts. Dynamics: building an excellent
system takes time. Session 5.2 asks: how do we theorise the process by which such systems are built
and changed?
Theories of Strategy · Session 5.2 · Dynamic capabilities view
, The view of the firm in neoclassically grounded theories (slide 8)
Factor market imperfections Product market imperfections
Resources BLACK BOX Products
“the firm”
Costly-to-copy resources Superior economic value
Resource-based view Positioning view (Porter)
Both positional views leave the firm a black box. The Low Church opens it — and the DCV tries to explain how what is inside changes
over time.
2 · The big picture: from positional to dynamic
Source: Lecture 10 (slides 10, 16–19) · Stoelhorst & Van Raaij (2004)
An integration of economic theories and strategy theories
Economic theories of the firm
Schumpeter Ricardo Chicago Bain-type IO
Unique resource Process Performance
Innovation combinations efficiencies Market power differentials
Learning New combination Value
Complementarity Capabilities Economic profit
asymmetry Cost
Scale
RBV (DCV) RBV (High Church) RBV (KBV) Positioning (Porter)
Strategic management
Read right-to-left as a causal chain: profit ← market power ← process efficiencies ← unique resource combinations ← innovation /
learning asymmetry. The DCV sits at the far (most “upstream”, most dynamic) end.
Four views of the firm (slide 17)
Product market Bundle of Activity Complex adaptive
position resources system system
Neoclassical / early Porter RBV (High Church) Later Porter / Low Church Evolutionary view
increasingly dynamic · increasingly “inside the black box” · less rigorous economic grounding
Theories of Strategy · Session 5.2 · Dynamic capabilities view
Session 5.2
The Dynamic Capabilities View
The resource-based view III — the “Low Church” and its evolutionary
foundation
Teece, Pisano & Shuen (1997) Stoelhorst & Bridoux (2015) Lecture 10 slides
2020-21 DCV clip Lecture notes & reading guide
Contents
1 Where 5.2 fits in the course 8 Generalized Darwinism: evolutionary logic
2 The big picture: from positional to dynamic 9 Stoelhorst & Bridoux (2015)
3 Teece, Pisano & Shuen (1997) 10 The 3R configuration & FAF
4 Processes, positions & paths 11 Positional vs temporal advantage
5 Teece: imitation, economizing & advice 12 Case: Amazon · principles · study question 10
6 The critique of the DCV 13 Links to the rest of the course
7 Winter: capabilities & routines 14 Definition list
Lecture / big picture Teece et al. (1997) Evolutionary theory & Winter Stoelhorst & Bridoux (2015) Exam tips
Study summary prepared for Nikki · exam 12 October 2026 · Based on the course readings, Lecture 10 (“The Resource-based
View III: The Low Church – Dynamic Capabilities”), the prerecorded DCV slides, the Reading Guide, the Study Guide and your
own lecture notes.
Theories of Strategy · Session 5.2 · Dynamic capabilities view
, 1 · Where Session 5.2 fits in the course
Session 5.2 is the third and last RBV meeting and the most ambitious attempt in the course to build a truly
dynamic resource-based theory. The Reading Guide calls the dynamic capabilities work influential but
“ultimately unsuccessful” as a theory, and the meeting therefore has two halves: (1) the seminal DCV paper
by Teece et al. (1997) and its problems, and (2) a proposal to repair it by grounding it in evolutionary logic
(Stoelhorst & Bridoux, 2015).
Block 3 — Dynamic views Key concepts for 5.2 (Study Guide)
4.1 Schumpeterian view I — dynamics, uncertainty, Dynamic capabilities
profit Processes, positions, and paths
4.2 Schumpeterian view II — expectations, creative Positional vs. temporal competitive advantage
destruction
Variation – selection – retention
5.1 RBV II — Low Church: knowledge & capabilities
Adaptive fit
5.2 RBV III — Low Church: dynamic capabilities ◀ Stoelhorst & Bridoux’s 3Rs
you are here
6.1 Schumpeterian view III — competitive dynamics,
increasing returns
6.2 Schumpeterian view IV — technology-driven
industries
The RBV family (Lecture 10, slide 7)
“High Church” “Low Church”
equilibrium logic · resource picking disequilibrium · capability building
Factor market competition Capabilities view — Dierickx & Cool 1989
Barney 1986
Knowledge-based view — Grant 1996
Core RBV (Ricardian rent)
Barney 1991 · Peteraf 1993 · Peteraf & Barney 2003
Dynamic capabilities view — Teece et al. 1997
Popular versions: Prahalad & Hamel’s (1990) core competencies; Stalk et al. (1992) organizational capabilities. Terminology High/Low
Church from Gavetti & Levinthal (2004).
KEY MESSAGE CARRIED OVER FROM 5.1
Complementarities: excellence is in the system, not in its parts. Dynamics: building an excellent
system takes time. Session 5.2 asks: how do we theorise the process by which such systems are built
and changed?
Theories of Strategy · Session 5.2 · Dynamic capabilities view
, The view of the firm in neoclassically grounded theories (slide 8)
Factor market imperfections Product market imperfections
Resources BLACK BOX Products
“the firm”
Costly-to-copy resources Superior economic value
Resource-based view Positioning view (Porter)
Both positional views leave the firm a black box. The Low Church opens it — and the DCV tries to explain how what is inside changes
over time.
2 · The big picture: from positional to dynamic
Source: Lecture 10 (slides 10, 16–19) · Stoelhorst & Van Raaij (2004)
An integration of economic theories and strategy theories
Economic theories of the firm
Schumpeter Ricardo Chicago Bain-type IO
Unique resource Process Performance
Innovation combinations efficiencies Market power differentials
Learning New combination Value
Complementarity Capabilities Economic profit
asymmetry Cost
Scale
RBV (DCV) RBV (High Church) RBV (KBV) Positioning (Porter)
Strategic management
Read right-to-left as a causal chain: profit ← market power ← process efficiencies ← unique resource combinations ← innovation /
learning asymmetry. The DCV sits at the far (most “upstream”, most dynamic) end.
Four views of the firm (slide 17)
Product market Bundle of Activity Complex adaptive
position resources system system
Neoclassical / early Porter RBV (High Church) Later Porter / Low Church Evolutionary view
increasingly dynamic · increasingly “inside the black box” · less rigorous economic grounding
Theories of Strategy · Session 5.2 · Dynamic capabilities view
