The Influence of a Deficit in Employees’ Dynamic Capabilities on Job Performance in Organisations During the Decline Stage of the Organisational Life Cycle as a Symptom of Organisational Death

Agnieszka Bienkowska; Katarzyna Tworek

doi:10.23762/FSO_VOL13_NO1_3

Published : 2025-03-29

Vol. 13 No. 1 (2025)

The Influence of a Deficit in Employees’ Dynamic Capabilities on Job Performance in Organisations During the Decline Stage of the Organisational Life Cycle as a Symptom of Organisational Death

Agnieszka Bienkowska

Katarzyna Tworek

https://orcid.org/0000-0002-6276-2436

DOI: https://doi.org/10.23762/FSO_VOL13_NO1_3

Abstract

This article investigates the impact of employees’ dynamic capabilities (EDCs) on job performance within organisations during the decline stage of the organisational life cycle (OLC), particularly as they approach organisational death. EDCs, which include an employee's ability to adapt, innovate, and solve problems, have been extensively studied in thriving organisations, but their role during organisational decline remains underexplored. This study addresses this gap by examining whether EDCs positively influence job performance through mediators such as work motivation, job satisfaction, and work engagement in organisations nearing the end of their operations. For two-part empirical analysis, data were gathered from organisations in Italy, Poland, and the USA, some of which were at varying stages of decline due to the external crisis caused by the COVID-19 pandemic. The results indicate that in organisations continuing operations, EDCs had a significant positive impact on job performance, mediated by work engagement, work motivation, and job satisfaction. However, in organisations heading toward death, EDCs failed to influence job performance significantly. The study concludes that EDCs' lack of impact on job performance may be a critical symptom of organisational death, suggesting that organisations unable to leverage their employees' capabilities during times of crisis may be doomed to failure. This research contributes to the OLC literature by identifying the absence of EDCs' influence on job performance as a key predictor of organisational demise, offering new insights for management practices during the decline phase of an organisation.

Keywords:

organisational death, employees’ dynamic capabilities, job performance, organisational life cycle.

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Bienkowska, A., & Tworek, K. (2025). The Influence of a Deficit in Employees’ Dynamic Capabilities on Job Performance in Organisations During the Decline Stage of the Organisational Life Cycle as a Symptom of Organisational Death. Forum Scientiae Oeconomia, 13(1), 37–52. https://doi.org/10.23762/FSO_VOL13_NO1_3

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