Purpose Resource cognition – identifying valuable resources and capabilities and assessing their potential for redeployment – is a pivotal management capability for strategic renewal. This study explores how managerial cognition in this activity may be biased, leading to erroneous results. Design/methodology/approach This study employs an action research approach: A full resource cognition project was conducted together with the top management of a case firm, including the CEO and members of the supervisory board. Findings Resource cognition may be distorted by four cognitive biases: The insulation bias – tending to keep one’s perspective insularly to the current business; the novelty bias – tending to exclusively focus on innovation and recent achievements; the status quo bias – tending to view opportunities from the current situation and structural set-up; and the scaffolding bias – tending to adopt concepts and examples indiscriminately to the firm. Originality/value Active participation in a resource cognition project provided first-hand and insightful practice-based evidence on resource cognition.

This publication-based dissertation examines the phenomenon of incumbent adaptation to changing environments with a dynamic capabilities perspective. Its core consists of four research papers that are self-contained and have been developed to be published in double-blind peer-reviewed academic journals. This intellectual body is framed with an introduction (Section 1) that introduces the current state of research on dynamic capabilities, summarizes the four research papers, and presents the current publication status of the work; the concluding Section 6 presents the overall contributions, limitations, and avenues for future research. The first research paper (Section 2) is a systematic literature review of empirical studies that identify idiosyncratic dynamic capabilities in practice. Its main finding is a taxonomy of dynamic capabilities that introduces 19 dynamic subcapabilities and connects them to existing conceptual literature. The second research paper (Section 3) is a longitudinal single case study of Axel Springer, a leading media corporation that has exercised dynamic capabilities to convert from a print publisher to an internet company. The study finds iterations, overlaps, and interconnections between sensing, seizing, and transforming. Based on the findings, a generalized conceptual model for dynamic capabilities in incumbent adaptation is constructed. For the third research paper (Section 4) an action research approach is applied to explore how managers’ mental models can engender erroneous resource cognition. The study discovers five cognitive biases that may distort resource cognition. The fourth research paper (Section 5) is a teaching case study building on the strategic challenge for Somedia, a Swiss media firm, to diversify from its declining legacy business by leveraging its resources and capabilities. This publication-based dissertation enhances the understanding of incumbent adaptation and presents applicable implications and recommendations for practitioners.

Dynamic capabilities have typically been conceptualized as sensing, seizing, and transforming. This article explores the interplay of these procedural dimensions employing a longitudinal case study of Axel Springer, a leading media corporation that has exercised dynamic capabilities to convert from a print publisher to an internet company. Insightful evidence is produced from interviews with current and former top managers. The case study shows iterations, overlaps, and interconnections between sensing, seizing, and transforming. Sensing-by-seizing is introduced as a dynamic capability to seize concrete opportunities while concurrently sensing them. A conceptual model furnishes implications and recommendations for managerial decision-making.