Dynamic capabilities erosion: a systematic review, integrative framework, and research agenda

Abstract Dynamic capability (DC) theory explains how firms adapt to changing environments; yet, it has largely been assumed that once developed, these capabilities remain available for renewal. This review challenges that assumption by examining dynamic capability erosion (DCE) as a gradual and processual weakening of sensing, seizing, and transforming capacities. Drawing on a systematic review of 137 peer-reviewed articles published between 2014 and March 2025; we integrate dispersed findings into an explanatory framework that clarifies how internal triggers and external pressures generate strain, how this strain is mediated through governance and cognitive shifts, and how erosion unfolds over time. The findings suggest that DC are not self-sustaining assets. Under sustained pressure, repeated enactment may progressively hollow out adaptive routines, often remaining latent until environmental shocks expose underlying fragilities. We extend the capability lifecycle by positioning erosion as a degenerative trajectory that can emerge during or after maturity, and we identify boundary conditions and mitigation mechanisms that influence capability health. The study makes DCE more empirically tractable and offers guidance on early warning indicators. For managers, the framework highlights the importance of protecting renewal conditions through balanced governance, organizational slack, and sustained learning investments. Overall, the review advances a more realistic and temporally grounded understanding of long-term adaptation in turbulent environments.