ABSTRACT
The strategic renewal is frequently used to explain examples of strategic change with most examples highlighting the process of change; however, strategic renewal is something more than the process of change. The classification of firms based on mechanisms of renewal and accordingly can be classified as: first, discontinuous renewal; and second, incremental renewal. Conducting renewal activities such as research and development (R&D) on a regular basis requires underlying processes, rules, routines and resources, along with the capabilities to develop and execute such activities, including dynamic capabilities. Besides, if a firm develops capabilities which are dynamic in nature and the application of the same is used specifically as an institutional mechanism to drive renewal, the effectiveness of the renewal process will be highly enhanced. Thus both continuous strategic renewal and discontinuous transformations offer pathways for firms to make transformations by which the end state of the firm after transformation differs from the state when the transformation started.
