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Dynamic Capabilities as Agentic KPIs: Is Your Organization Ready?

Writer: David GolubDavid Golub

Updated: Feb 6

Dynamic Capabilitiess are Ideally suited to evaluating the disruptive potential of AI agents.
Dynamic Capabilitiess are Ideally suited to evaluating the disruptive potential of AI agents.

The product manager stared into her screen as the customer service demo handled her toughest test cases. "The agent seems to be working," she said, "but how do we know if it's ready for production?"


This question is harder than it seems. Unlike traditional artificial intelligence, which typically runs in the background and provides insights via well-structured dashboards, autonomous AI agents defy familiar measurement frameworks.


With machine learning, you're typically assessing how well a model performs a well-defined task. But agents are more like new employees – they need to learn the business, make judgment calls and grow from experience.


Turns out, in the tech world, we've seen this movie before. Back in the 1990s, business thinker David Teece was wondering why companies like IBM and Intel thrived during periods of rapid change while others failed. 


His insight, remarkably relevant today, was that static advantages ("the best product") quickly become obsolete in fast-moving markets. What matters is an organization's ability to continuously adapt to maintain “evolutionary fitness.”


Teece's resulting framework – which he famously called dynamic capabilities – argues that success requires three core abilities: sensing opportunities and threats, seizing them through decisive action and transforming the organization to stay competitive. 


The venerable Dynamic Capabilities model turns out to be ideally well suited to evaluating the disruptive potential of AI agents.


Organizations adopting agentic tools need to reinvent themselves according to the KPIs of tomorrow. Success isn't just about choosing the right agent – it's about retooling workflows to embrace these new digital colleagues.


In the end, measuring autonomous agents requires flexible performance metrics designed to foster a more intelligent, adaptive organization.


Sensing: Moving from Transactions to Context


Take Intel's journey in the 1990s. They transformed from a company that tracked competitor chip specs to one that dominated entire market ecosystems – including seemingly unrelated technologies..


Similar transformation happens when organizations deploy autonomous agents. Yes, your customer service agent needs to understand angry emails about delayed shipments. But the real power comes when agent sensing capabilities reshape how your entire organization understands customer needs.


Imagine an organization where every customer interaction enriches your understanding of market dynamics. Where agents don't just spot individual VIP clients but identify emerging customer segments. Where shipping delays aren't just problems to solve but signals about supply chain resilience.


Testing this transformation requires scenarios that push beyond transaction handling. Start simple, then explore how agent sensing ripples through your organization. 


  • Does the agent's understanding of customer frustration inform product development? 

  • Do its insights about policy exceptions highlight opportunities for business model innovation?

  • Does its collaboration with human teammates create new ways of sharing knowledge?


The metrics matter: aim for 95% accuracy on straightforward requests, working toward 85% for complex conversations and 80% for novel situations. 


But these numbers point to bigger questions about the evolition of your organization's sensing capability. Are you gaining a richer understanding of your market? Are you spotting opportunities and threats earlier?


Seizing: From Service Delivery to Value Creation


IBM's transformation from hardware vendor to services partner offers a powerful parallel. Big Blue didn't just add consulting services – they reimagined how technology creates business value by orchestrating complex solutions.


When organizations deploy agents, a similar opportunity emerges. To be sure, your agent needs to handle immediate tasks – expediting shipments, offering compensation, updating systems. But the real transformation happens when agent capabilities reshape operations.


Imagine moving from reactive problem-solving to proactive value creation. Where agents don't just resolve customer issues but identify opportunities to deepen relationships. Where compensation isn't just about making things right but about strengthening customer loyalty. Where every interaction becomes a chance to demonstrate organizational agility.


Evaluating this transformation means looking beyond decision quality to decision impact. Create scenarios that test not just what the agent can do, but how its capabilities amplify your organization's ability to seize opportunities. 


Are you moving faster? Creating more value? Building stronger relationships?


Target metrics should reflect growing autonomy: aim for 70% of basic decisions requiring no human modification, increasing to 85% as the agent learns. But here's the golden rule that never changes: when in doubt, escalate to scale. 


An agent that knows its limits is worth its weight in gold.


Transforming: From Optimization to Evolution


Amazon's evolution from bookstore to everything store required more than just adding product categories. They envisioned new capabilities – from logistics to cloud computing – that transformed what they could become.


This is where agent capabilities become truly powerful. A mature agent deployment isn't just about handling more cases or making better decisions. It's about building an organization that learns and evolves more effectively.


Think about company evolution: 


  • How do agent interactions create new knowledge that shapes strategy? 

  • How does agent learning accelerate organizational adaptation? 

  • How do human-agent partnerships create new possibilities for innovation?


Testing transformation means evaluating your organization's evolutionary capability. Present challenges that require not just better performance but new ways of working. 


Does agent learning spark human innovation? Do human-agent interactions generate new insights about market opportunities? Is your organization getting better at not just doing things right but doing the right things?


The goal isn't just improving agent performance – it's accelerating organizational adaptation. Where traditional automation optimizes existing processes, autonomous agents should catalyze new ways of creating value and navigating to change.


Implementation Strategy


The shift to autonomous agents mirrors earlier technological transformations – unique to each organization but following common patterns. 


Healthcare organizations aren't just adding AI capabilities, they're reimagining patient care workflows. Retailers aren't just automating customer service, they're rebuilding their relationship with consumers.


Start by assembling not just a deployment team but a transformation group. Include leaders who understand both operational realities and transformational possibilities. Your governance structure shouldn't just manage agent performance but guide organizational evolution.


Roadmap for capability development:


  • Prototyping (1-3 months): Explore agentic workflows and establish learning loops that capture insights from every interaction.


  • Scaling (3-6 months): Grow organizational muscle around agentic service delivery models and decision-making processes.


  • Transformation (6-12 months): Build competitive advantage by confidently deploying agents within core business operations


Take good notes as you go, look for new patterns. Unlike traditional tech deployment where success means stable performance, agent transformation allows new capabilities to emerge in sometime unexpected ways. 


Ultimately, what matters is how well the organization senses opportunities, makes decisions and learns from experience.


Looking Ahead: Reimagination


When considering agentic deployments, the parallels with past tech transformations are instructive. The companies that thrived in the 1990s reimagined their busines models. The same will be true for adopting autonomous agents.


Traditional digital transformation focused on optimizing existing processes and workflows. The agentic transformation is different – it's about building organizations that can learn and evolve at machine speed while maintaining human judgment and creativity.


For business leaders, Teece's framework offers more than an evaluation toolkit. It provides a blueprint for organizational reinvention in the age of autonomous agents. 


The winners won't just deploy better agents – they'll build organizations capable of continuous evolution through human-agent collaboration.


Success isn't just about perfecting performance or optimizing specific workflows. It's about creating organizations that get better at getting better – where human insight and machine capability combine to speed adaptation.


Ultimately, the question isn't whether your agents are ready for production – it's whether your organization is ready for transformation.


 

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