The Effect of Dynamic Capabilities in Creation of Competitive Advantage

Competitive environment of today businesses has changed in a way that many scholars suggest that managers should invest more on dynamic capabilities. Gaining dynamic capabilities is a vital for corporate managers in such an environment. This paper is to investigate the effect of dynamic capabilities on competitive advantages. At first we reviewed the competitive advantage and strategy formulation approaches briefly and then we reviewed the dynamic capabilities in the literature. With this review, we hypothesized the effect of dynamic capabilities on competitive advantages. In order to examine this hypothesize, 142 managers of firms in Salafchagan industrial complex were asked to fill in the questionnaire. Results show that each of the dimensions of dynamic capabilities has an effect on competitive advantages, while learning capability has the strongest effect.