How leaders use values-based guidance systems to create dynamic capabilities

Rosabeth Moss Kanter, Matthew Bird, Ethan S. Bernstein, Ryan Raffaelli

Research output: Chapter in Book/Report/Conference proceedingChapterpeer-review


How do strategic leaders create change-adept organizations? Based on qualitative field research, this chapter argues that well-defined institutionalized purpose, values, and principles act as an organizational guidance system that integrates and strengthens the micromechanisms which enable leaders to build dynamic capabilities and, therefore, change-adept organizations. From empirical case studies, we distill micromechanisms through which organizational guidance systems create fertile soil for dynamic capabilities. The five micromechanisms are values-based decision heuristics; intrinsic motivation with positive emotions; an organizational control system based on entrepreneurial self-organization, self-management, and peer regulation; an organizational identity that (a) fosters a longer-term perspective and (b) widens the firm’s scope; and ecosystem creation. While much of the dynamic capabilities literature has focused on testing causal relationships between key performance variables and constructs, our goal here is to “open up” the regression model, provide a closer qualitative inspection of the “how-to” micromechanisms, and thereby advance a multidisciplinary research agenda.
Original languageEnglish
Title of host publicationThe oxford handbook of dynamic capabilities
EditorsDavid J. Teece, Sohvi Heaton
PublisherOxford University Press
ISBN (Print)9780199678914
StatePublished - 10 Sep 2015


  • Change-adept
  • Dynamic capabilities
  • Field research decision heuristics
  • Intrinsic motivation
  • Institutional certainty
  • Organizational control
  • Entrepreneurial self-organization
  • Organizational identity
  • Ecosystem


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