Dynamic Capabilities for Strategic AI Adoption and Institutional Transformation in Higer Education
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Abstract
The development and deployment of dynamic capabilities by higher education institutions (HEIs) to navigate artificial intelligence (AI) adoption has become a critical imperative in contemporary digital transformation. Grounded in Dynamic Capabilities theory, this systematic literature review examines how sensing, seizing, reconfiguring, and transforming processes support institutional adaptation amid technological disruption. Using the Preferred Reporting Items for Systematic Reviews and Meta-Analyses (PRISMA) protocol, peer-reviewed articles published between 2020 and January 2026 were identified, screened, and synthesized from Scopus, IEEE, Taylor & Francis, and Wiley Online Library. The Theory Context Construct Method (TCCM) framework is further applied to classify theoretical foundations, research contexts, constructs, and methods. The findings indicate that Dynamic Capabilities theory provides a robust lens for understanding AI readiness, governance, and resource orchestration in HEIs. Leading institutions demonstrate sensing through environmental scanning, AI literacy audits, policy monitoring, and experimental search; seizing through structured pilots, AI governance mechanisms, investment, and staff development; and reconfiguring through redesign of curricula, assessment, library services, micro-credential ecosystems, and administrative routines. However, the literature remains fragmented across single-institution cases, adjacent organizational studies, and inconsistent operationalizations of dynamic capabilities. Significant gaps remain in longitudinal evidence, standardized measurement, cross-national comparison, and responsible AI governance. By integrating PRISMA and TCCM, this review advances a capability-based research agenda and positions dynamic capabilities as a central mechanism for sustainable AI adoption in higher education. The findings will be presented at the ASBN Conference 2026 and submitted for publication in the conference proceedings.
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