MANAGING A SUSTAINABILITY-ORIENTED INNOVATION THROUGH DYNAMIC CAPABILITIES - A Multiple Case Study on Swedish companies

Abstract: This thesis aims to describe the key dynamic capabilities and critical factors that contribute to the development of sustainability-oriented innovation along with the main challenges companies face during the process of implementation. To successfully implement sustainability-oriented innovation, dynamic capabilities play an essential role in the implementation process. This thesis is based on a systematic literature review and semistructured interviews with respondents from Swedish companies, addressing dynamic capabilities (absorptive, environmental, competence and the ability for innovation, resource integration, organisational, networking, and technological) and challenges that (managerial, regulatory, social, technical and financial) they can face during the process. The findings from the literature review and empirical findings suggest that all the dynamic capabilities are identified to be key for implementing sustainability-oriented innovation while one factor is newly discovered in the organisational dynamic capability. Moreover, five challenge groups were validated to be the main challenges that companies encounter when implementing sustainability-oriented innovation.