In Search of the “How” of Dynamic Capabilities in Digital Transformation: Contradictions as a Source of Understanding

Digital transformation (DT) of the society causes companies to face complex changes and uncertainties. New technologies enable novel forms of operation, but they also inflict new organizational capability requirements. Dynamic capabilities (DCs), the organizations’ ability to sense and seize opportunities and to transform, are often seen as a key to remaining competitive in the constantly changing environment. However, further empirical understanding on how DCs develop in organizations particularly in the context of DT is required. This ongoing qualitative longitudinal case study aims to address this need. As findings, the paper presents three types of contradictory phenomenon between supporting and hindering change during a transformation process in a case company. The contradictions illustrate how dynamic and operational capabilities may evolve together with change across the organization. The findings indicate the DC to be a multi-level construct and propose new empirical insight into DC development in digital transformation