Fath-Kolmes, E. M. and Long, T. B. (2026) Dynamic capabilities for sustainability and performance maturity levels: Evidence from the construction industry. Construction Management and Economics, 44(6), pp. 430-452. ISSN 0144-6193
Abstract
This study refines dynamic capabilities theory by showing that the development of sustainability-oriented capabilities is shaped by a firm's organizational design as well as its level of sustainability performance maturity, which influences how and when different microfoundations emerge. Drawing on a multi-case study of 8 Canadian construction firms recognized as sustainability leaders, the research explores how dynamic capabilities—sensing, seizing, and transforming—are operationalized through certain microfoundations. The findings suggest that firms which achieve higher levels of sustainability performance seem to systematically develop localized innovation initiatives, early stakeholder engagement practices, performance measurement mechanisms, and organizational change routines. These dynamic capabilities are enabled by decentralized organizational structures, cross-functional learning systems, and purpose-driven leadership. By linking organizational design to the evolution of dynamic capabilities for sustainability, this study offers theoretical insights into the role of internal configurations in capability development. Practical implications are provided for firms in project-based and hard-to-abate sectors seeking to embed sustainability into their core operations and pursue long-term environmental and social objectives.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | dynamic capabilities; dynamic capabilities for sustainability; sustainability performance |
| Index terms: | configuration, evidence, evolution, dynamic capability, routine, organizational structure, organizational change, construction firm, drawing, stakeholder engagement, construction industry, organizational design, maturity level, case study, performance measurement, sustainability performance, capability development |
| Subjects: | technical documentation, data collection methods, business, community and social dimensions, sociology, industry analysis, systems engineering, performance measurement, management, environmental science, evaluation and assessment methods, organization, sustainability assessment, evaluation |
| Topics: | Quality Management, Sustainability, Engineering Principles, Organizational Design, Design Practice, Stakeholder Management, Business Strategy, Research Practice |
| Descriptive scope: | 5 PCTEA |
N.B. Descriptive scope is a count of how many of the five facets of empirical research are indicated by the words used in title, abstract and keywords. It is not intended as a judgement on the research; merely a count of the kind of word we would expect to indicate Phenomenon, Concepts, Theoretical framing, Empirical techniques, Analytical techniques. If all five are present, then a code of “5 PCTEA” will indicate this. If you feel the coding for this record is questionable, we welcome discussion around the terms we matched or the way we categorized them. The facet you would expect may not be coded, or a facet may be coded inappropriately. This can also bear on a larger question, of which facets should be treated as defining in construction management research. Please get in touch, and we will look at it. More details here