Contextualizing dynamic capabilities for sustainability-driven enterprises in an emerging economy: an exploratory study from Indonesia

This exploratory qualitative study investigates how dynamic capabilities (DC) manifest in sustainability-driven enterprises (SDEs) in Indonesia. In this emerging economy, common DC assumptions such as resource availability, institutional stability, and market functionality do not reliably hold. Rather than resolving the universality of DC theory, it offers an Indonesian-based elaboration of how sensing, seizing, and transforming are implemented under acute resource constraints and institutional voids. Semi-structured interviews with ten expert informants (six entrepreneurs and community leaders, two corporate intrapreneurs, two consultants/academics), selected through purposive and snowball sampling, were analyzed using the Gioia methodology, yielding 77 first-order concepts, 24 second-order themes, and nine aggregate dimensions. Four challenge clusters emerged: economic survival dominance, regulatory dependence with institutional voids, severe resource constraints, and leadership dependency. In response, capabilities manifest as risk-integrated sensing, frugal seizing, and value-anchored transforming, enabled by two meta-capabilities: generative leadership and intergenerational knowledge management. The analysis also distinguishes institutionalized routines from ad hoc bricolage and realized from planned outcomes. The study contributes a propositional, context-contingent elaboration of DC theory, grounded in the sustainability and hybrid-organizing context, and an actionable guidance is also provided for those organizations operating where institutional support is weak, which is presented as a basis for comparative testing across emerging economies, instead of a general theory of them.