Dynamic capabilities as microfoundations for technological business model innovation in law firms: exploring drivers and barriers for change

Abstract

In an era of rapid technological change, law firms face mounting pressure to reimagine how legal services are delivered. This doctoral thesis investigates business model dynamics in law firms, with a particular focus on the role of dynamic capabilities as an enabler of technological business model innovation. Dynamic capabilities refer to an organization’s ability to sense opportunities, seize them effectively, and reconfigure resources to sustain competitive advantage.

Drawing on empirical studies across small and large law firms, the research challenges conventional assumptions about organizational size, inertia, and responsiveness. The analysis identifies key drivers for change, such as technological trends and client expectations, and explores persistent barriers, including cognitive rigidity and short-termism in leadership. It reveals that the perception of technology as an opportunity, rather than a threat, may paradoxically contribute to business model change innovation inertia. The thesis also demonstrates how dynamic capabilities mediate the relationship between drivers and barriers to technological business model innovation. These insights, when taken together, confirm that dynamic capabilities contribute meaningfully to successful business model change in law firms.

By bridging theory and practice, this work contributes to the strategic management literature on professional service firms operating in volatile, uncertain, complex, and ambiguous (VUCA) environments. This thesis has value for legal practitioners interested in the intersection of legal service delivery, business model transformation, and technological change.