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Dynamic Capabilities: A Key to Transforming Government Agencies?

The views expressed are those of the author and do not necessarily reflect the views of ASPA as an organization.

By Bill Brantley
June 13, 2020

I have been on mandatory telework for over three months now. My day is filled with WebEx online meetings because that is my agency’s preferred tool. But I have plenty of Zoom calls at night with my teaching and volunteer work. Last week, while on vacation, I attended three virtual conferences at once: The Association for Talent Development’s five-day conference, a week-long conference in Norway devoted to learning experience design and the five-day Agile Virtual Summit.

You have probably had similar experiences. Especially if you are working in a college or university, you had to move your courses online this spring, and you may still teach online in the fall. If you are like some of my academic colleagues, you also had to take on new teaching duties as you suddenly began homeschooling your children. These are uncertain times, as numerous commercials from numerous companies have told us.

What is Different About This Time of Change?

There is always change. Much of the public administration theory is how government agencies and leaders adapted to and grew from change. Or how public administration sometimes failed to adapt to change. What impact has this latest series of changes triggered by the COVID 19 crisis had on public agencies and the government workforce?

The full effects will not be known for a while, but we can determine the immediate consequences. First, the sudden shift to remote work has strained the agencies’ technological infrastructures. Second, preliminary data has shown no change or a slight increase in productivity by teleworking employees. Third, there is a renewed focus on work-life balance as public employees are encouraged to put their families first and to keep their morale up. Existing agency resources and policies have had to be repurposed or significantly altered to meet new challenges.

I hope that this experience will provide valuable lessons in being prepared for the next crisis. Too often, organizations survive a crisis and then fail to learn from it. For example, the board that examined the Space Shuttle Columbia disaster pointed out several instances where the National Aeronautics and Space Administration (NASA) failed to learn from the Space Shuttle Challenger disaster. What can be done to help government agencies prepare for unexpected change and planned change?

Enter Dynamic Capabilities

The concept of dynamic capabilities was first written about in the late 1990s. A capability is defined as the, “Ability to perform a particular task or activity.” (All quotes are taken from Dynamic Capabilities: Understanding Strategic Change in Organizations by Helfat, Finkelstein, et al., 2007). Operational capabilities are what organizations use to run their business processes. Dynamic capabilities are used to, “Identify the need or opportunity for change, formulate a response to such a need or opportunity and implement a course of action.”

Dynamic capabilities act upon the organization’s resource base. The resource base of an organization, “Includes tangible, intangible and human assets (or resources) as well as capabilities which the organization owns, controls or has access to on a preferential basis.” Dynamic capabilities can affect other dynamic capabilities because all the organization’s capabilities are part of the resource base.

Measuring the Evolutionary Fitness and Technical Fitness of Dynamic Capabilities

The primary way to measure the performance of dynamic capabilities is to see how well the organization’s dynamic capabilities, “Match the context in which the organization operates.” This performance measure is called evolutionary fitness. Evolutionary fitness is influenced by quality, cost, market demand and competition. Dynamic capabilities are also measured by their technical fitness, which is how well the dynamic capability performs its intended function divided by the total costs of the capability.

How Can Public Agencies Use Dynamic Capabilities?

The first step is for public agencies to create an inventory of their capabilities. Examine each capability and determine if it is an operational capability or dynamic capability. The second step is to review the agency’s environment. How well does the agency’s capabilities inventory help it meet the demands of the environment? What steps can the organization take to meet the needs of the agency’s immediate environment more effectively?

The third step for the agency is to develop an environmental scanning capability. What changes are in the agency’s environment? What new dynamic capabilities should the organization develop? What existing capabilities can be repurposed to meet sudden changes?

A longer-term solution is for agencies to develop a scenario planning capability to supplement the environmental scanning capability. The agency can run simulated drills to try out new dynamic capabilities to determine their evolutionary and technical fitness.

As many agencies have found in making the shift to full-time teleworking, existing policies, work processes and technologies could be repurposed to handle the new environment. However, there was much confusion and technological failings that marred the first days of coping with COVID-19. Creating a capabilities inventory and building new dynamic capabilities can help agencies deal with the next crisis.


Author: Bill Brantley teaches at the University of Louisville and the University of Maryland. He also works as a Federal employee for the U.S. Patent and Trademark Office. All opinions are his own and do not reflect the views of his employers. You can reach him at http://billbrantley.com.

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The American Society for Public Administration is the largest and most prominent professional association for public administration. It is dedicated to advancing the art, science, teaching and practice of public and non-profit administration.

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