Analysis of Dynamic Capabilities for Digital Transformation in the Construction Industry

Digital Transformation (DT) is revolutionising industries worldwide, yet its adoption in the construction sector remains slow. The integration of emerging technologies, such as Artificial Intelligence (AI), the Internet of Things (IoT), and Building Information Modelling (BIM), has the potential to improve operational efficiency, sustainability, and competitiveness. However, cultural resistance, high implementation costs, and a lack of digital skills persist as barriers to DT adoption. This study examines the role of Dynamic Capabilities (DC) in enabling successful DT implementation within the construction sector. The findings reveal the essential role of DC and its sub-capabilities, specifically sensing, seizing, and reconfiguring capabilities, which are crucial for organisations to integrate digital technologies effectively. The study highlights that firms with strong DC frameworks can successfully navigate technological inefficiencies, financial constraints, and organisational barriers. However, the lack of structured digital strategies, digital awareness/ leadership and regulatory support remains a significant challenge. The research suggests that regulatory policies, implementing strategic digital frameworks, and workforce upskilling programs are critical to accelerating DT adoption. This paper contributes to the ongoing discourse on DT by offering insights into how construction firms can leverage DC frameworks to achieve long-term digital sustainability. The study provides valuable recommendations for industry practitioners, policymakers, and researchers to develop practical strategies for overcoming the barriers to DT in the construction industry.