Defence Studies

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DYNAMIC CAPABILITIES: proposition of an analysis

tool for a defense industry in Brazil

Marcus Vinicius Gonçalves da Silva & Jansen Maia Del Corso

To cite this article: Marcus Vinicius Gonçalves da Silva & Jansen Maia Del Corso (2023)
DYNAMIC CAPABILITIES: proposition of an analysis tool for a defense industry in Brazil,
Defence Studies, 23:2, 238-253, DOI: 10.1080/14702436.2023.2206959

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Published online: 27 Apr 2023.

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DEFENCE STUDIES
2023, VOL. 23, NO. 2, 238–253
https://doi.org/10.1080/14702436.2023.2206959

DYNAMIC CAPABILITIES: proposition of an analysis tool for

a defense industry in Brazil
Marcus Vinicius Gonçalves da Silva and Jansen Maia Del Corso
Business School, Pontifical Catholic University of Paraná (PUCPR), Curitiba, Parana, Brazil

ABSTRACT ARTICLE HISTORY

Purpose: – This study starts from the observation that there is Received 14 June 2022
a mismatch, in Brazil, between the strategic actions listed in the Accepted 21 April 2023
National Defense Strategy, and the capabilities of Strategic Defense KEYWORDS
Companies. Brazil; Dynamic capabilities;
Design/methodology/approach: – The study is classified from the Defense industrial base;
point of view of the approach to the problem, as qualitative , using Strategy; Organizational
the single case study method. performance; Defense
Findings: – The use of the DC-Defense instrument will enable industries
Strategic Defense Companies to know their dynamic capabilities,
so that they can, in their strategic planning, develop actions that
allow them to generate competitive advantage.
Research limitations/implications: – As a research limitation, it is
pointed out the study of a single case, IMBEL, but the data of
Strategic Defense Companies are not available, due to the complex­
ity and sensitivity of the products and technologies involved, which
demands secrecy on the part of the high management.
Practical implications: – The DC-Defense instrument aims to help
Strategic Defense Companies to know their dynamic capabilities
and set goals in their strategic plans, which allow them to generate
competitive advantage.
Originality/value: – In this study, an instrument called Dynamic
Capacities in Defense (DC-Defense) was proposed..

1. Introduction
In Brazil, the National Defense Strategy (NDS) presents some challenges to keep up with
the growth in demand for Strategic Defense Products (SDP), in order to competitively
consolidate the Defense Industrial Base (DIB), such as: i) increase investments in
Research, Development and Innovation (RD&I); ii) expand participation in domestic
and foreign markets; and iii) strengthen the supply chain in the country (Brasil 2020).
Furthermore, it considers important the search for the domain of dual-use technol­
ogies, in order to favor the use of products for military and non-military purposes.
Competitiveness is caused by the technological duality, which allows the intersection of
civil and military activities, in a virtuous circle (Herteman 2008). The author emphasizes
that the duality contributes to reducing the costs of defense materials and to gain export

CONTACT Marcus Vinicius Gonçalves da Silva marvin.gsilva@gmail.com Business School, Pontifical Catholic
University of Paraná (PUCPR), Coronel Teixeira Avenue, 6225, Ponta Negra Neighborhood, Liverpool, Tower 2, Apartment
1001, Manaus, Amazonas, Curitiba, Parana, Brazil
© 2023 Informa UK Limited, trading as Taylor & Francis Group
 DEFENCE STUDIES 239

markets, contributing to the sustainability of technological competences in countries that

face budgetary constraints.
The current version of the NDS continues to highlight the DIB. However, the
objectives and strategic actions are presented without much detail, highlighting the
need to associate investment in defense with the progress of the related major strategic
projects of each armed force (De Rezende and Blackwell 2019).
It is then evident that the Strategic Defense Companies (SDC) must know their
capabilities and limitations, which implies the elimination of production activities that
do not have demand, both internally and externally, and that do not generate added
value, defining which are the niches of technological competences and areas of excellence
that demand investment.
A company with strong dynamic capabilities is capable of implementing strategic
planning and implementing strategic actions quickly and effectively (Teece 2014).
Dynamic capabilities, therefore, defines the company’s ability to innovate, adapt to
changes and/or generate changes that are favorable to customers and unfavorable to
competitors (Leih, Peteraf, and Teece 2016).
Therefore, we have the following research question: What are the microfoundations
of the dynamic capabilities identified in a Strategic Defense Company?
To answer this question, this study is divided into seven chapters, including this
introduction. Chapter 2 refers to the conceptual approaches necessary to understand
the importance of the topic and is dedicated to presenting the panorama of National
Defense, composed of the National Defense Strategy (NDS); concepts and character­
istics of the Defense Industrial Base (DIB); describes Strategic Defense Companies
(SDC); and briefly deals with the theory of dynamic capabilities. In Chapter 3,
a bibliometric research is carried out in order to verify which are the most con­
solidated authors and concepts on the topic of dynamic capabilities. Chapter 4
addresses the methodological path adopted to achieve the proposed objective.
Chapter 5 presents the case study, Brazilian War Material Industry (IMBEL).
Chapter 6 analyzes and discusses the results, and finally, in chapter 7, the conclusion
is drawn.

2. Conceptual approaches
2.1 National defense strategy
The National Defense Strategy (NDS), a defense policy document, is formulated from
employment hypotheses that are defined considering the threats to the country, estab­
lishing guidelines for the adequate preparation and training of the Armed Forces,
emphasizing the need for the strengthening of strategic sectors in the pursuit of national
development (Brasil 2020).
It highlights, among other guidelines, the need to develop the potential for military
and national mobilization to ensure the deterrent and operational capacity of the Armed
Forces, that is, theNDS is inseparable from the national development strategy.
In this context, it is essential to obtain military defense capabilities through the
development of the country’s industrial, scientific-technological and logistical base, as
well as its knowledge. It is, therefore, essential to have an autochthonous defense industry
240 M. V. GONCALVES DA SILVA AND J. M. DEL CORSO

involved in research, development, production and services to meet the needs of National
Defense.
Based on the considerations contained in the National Defense Policy (NDP), the
document National Defense Strategy (NDS) consists of 18 (eighteen) Defense Strategies
(DS), directly aligned to 08 (eight) National Defense Goals (NDG) in which 86 (eighty-
six) Strategic Defense Actions (SDA) are incorporated. An DS can contribute to more
than one NDG, and the same occurs with SDAs in relation to DS. In this case, they may
be of identical or different natures (Brasil 2020).
The NDS established guidelines stimulating the interaction of the most varied institu­
tions and companies, aimed at strengthening the DIB, with the main strategic objective of
the NDS being the country’s scientific and technological training in the military sector
(Amarante 2012).
However, the NDS highlights that in order to competitively consolidate the national
defense industry, it is necessary to expand participation in domestic and foreign markets
and strengthen the supply chain in Brazil.

2.2 Defense industrial base

The Defense Industrial Base (DIB) can be seen as a sector or group of industries that have
some dependence on public defense expenditures, in which the State also has some
degree of dependence for self-sufficiency in the production of defense products means of
defense and warfare (Dunne 1995).
The BID is an essential element in the defense of a State. The importance of the BID
comes both from its strategic nature, resulting from the production of the country’s
defense equipment, essential to guarantee the defense and its autonomy, and from its
economic aspects, which are related to the mastery of sensitive technologies, many with
a dual character, and the generation of innovation, high-skill jobs and exports with high
added value.
Despite the reduced percentage of the Defense budget for investments, the BID has
generated a significant number of direct and indirect jobs and some companies have
managed to maintain a regular flow of exports, even with high and medium technology
products, presenting themselves as an alternative to improve the Brazilian trade balance
surplus.
Regarding Gross Domestic Product (GDP), BID develops, produces and markets
products and equipment with high added value, playing an important role in national
economic growth (Leih, Peteraf, and Teece 2016). The BID represents 4.46% of GDP,
generating 2.9 million direct and indirect jobs (Ministry of Defence 2021).
The structuring and strengthening of the BID constitute a strategic priority for
a country like Brazil, which, in addition to having a considerable heritage of strategic
natural resources that it needs to protect, is seeking an active insertion in the interna­
tional political and economic scene.
Brazil is a country in which BID has development potential but requires knowledge
about its current and potential industrial capacity, and of possible strategic partners
(Brick, Sanches, and Gomes 2017). Strategic partnerships in the defense sector with other
countries are important for internal development and the progressive reduction of
external technological dependence, as well as for increasing Brazilian competitiveness
 DEFENCE STUDIES 241

in terms of Defense Products (Prode). Thus, the perspective of expanding demand for
strategic defense products (SDP) offers an excellent opportunity for the development and
strengthening of the BID.
In strategic sectors considered critical, a priori, it is up to the State to finance the
development of technologies and, eventually, when there are no economic conditions to
guarantee the sustainability of these companies, to assume full responsibility for their
production (Brick 2011).
In this context, in 2020, there was progress in terms of financing for the DIB.
The Ministry of Defense and the National Development Bank (BNDES) signed
a protocol of intentions for structuring actions aimed at developing the defense
industrial base (Defesanet 2020). The initiative aims to promote technological
development and Brazilian exports in the sector. The agreement is in line with
the Strategic Defense Action (SDA-43) of NDS-2020, that is, to improve the
mechanisms (Brasil 2020).
It stands out that the State continues to attribute its work as a complement to the work
of the private sector: “The state component of the Defense Industrial Base should, in
principle, design and produce what the private sector cannot do profitably in the short
and medium term. (. . .)” (Brasil 2020, 43). It is also up to the State to use its purchasing
power to guarantee conditions for the sustainability and improvement of the DIB.
In NDS-2020 there is a space dedicated to explaining the direction that, ideally, should
be adopted in state purchases, which should value the use of products both in the sphere
of defense and in the field of public safety (Brasil 2020). The BID, as a strategic asset, the
State has to guarantee its preservation, which implies the adoption of protection, devel­
opment and expansion measures (Moynot 2010). The author argues that

The effect of scientific discoveries, advanced technologies and the development of new fields
of activities of activities makes it strategically necessary for the State to have, directly or
indirectly, appropriate financial instruments and a capacity to promote strategic invest­
ments that open the way for new industries (Moynot 2010, 133).

Even if one opts for the supposed simplicity of defining the DIB, based on the set of
companies that comprise it, these are found in different sectoral classifications, with
varied production processes (technology, inputs) and applications and products for
varied use, in the civil and military market, which are characteristics of Strategic
Companies of Defense (Sandler and Hartley 2007).

2.3 Strategic defense companies

Integrated into the DIB are the Strategic Defense Companies (SDC), defined in Law
No. 12598, of 21 March 2012 as well as any legal entity accredited by the Ministry of
Defense upon cumulative compliance with the following conditions:

a) have as purpose, in its corporate goal, carrying out or conducting research, design,
development, industrialization activities, provision of the services referred to in art. 10,
production, repair, conservation, overhaul, conversion, modernization or maintenance of
PEDs in the country, including the sale and resale only when integrated with the aforemen­
tioned industrial activities;
242 M. V. GONCALVES DA SILVA AND J. M. DEL CORSO

b) have its headquarters, administration and industrial establishment in the country,

equivalent to an industrial or service provider;

c) have, in the country, proven scientific or technological knowledge of its own or com­
plemented by partnership agreements with a Scientific and Technological Institution to
carry out joint activities of scientific and technological research and development of
technology, product or process, related toes to meet the activity developed, observing the
provisions of item X of the caput;

d) ensure, in its articles of association or in the acts of its direct or indirect controller,
that the set of partners or shareholders and groups of foreign partners or shareholders
cannot exercise in each general meeting a number of votes greater than 2/3 (two
thirds) of the total votes that may be exercised by the Brazilian shareholders present;
and

e) ensure the continuity of production in the country (Brasil 2012, n.p.).

Data as of 29 September 2021, reveals that there are 120 SDCs accredited by the
Ministry of Defense (Mixed Defense Industry Commission [CMID], 2021). 69.2% (n
= 83) are located in the southeast region (57 in the state of São Paulo, 21 in the state
of Rio de Janeiro and 5 in Minas Gerais), 22.5% (n = 27) are located in the south
region, 9 in Rio Grande do Sul, 14 in Santa Catarina, 4 in Paraná, and 8.3% (n = 10)
located in the states of the Federal District (n = 3), Amazonas (n = 2), Pernambuco (n
= 2), in Ceará (n = 1), Mato Grosso do Sul (n = 1) and Goiás (n = 1), as shown in
Figure 1.

Figure 1. Strategic Defense Companies. Source: Elaborated from Caslode (2021).

 DEFENCE STUDIES 243

Evidence points out that the SDCs, before any strategic action, must know their
capabilities and limitations, and prospect the future in an integrated way in the eco­
nomic, social and political dimensions.
This implies the elimination of production activities that do not have demand, both
internally and externally, and that do not generate added value, defining which are the
niches of technological competences and areas of excellence that demand investments.
That said, it is observed that the SDC are relevant both in the economic sphere and in
social issues. However, they still depend on political decisions that intend to solve
existing problems and that support the needs that this sector has.

3. Bibliometric research
3.1 Dynamic capabilities
The study of dynamic capabilities is an affluent branch of management research activ­
ities. The importance of this concept lies in the fact that it deals with the adaptive capacity
of the firm in the face of the dynamism of the environment, that is, how organizations
can achieve and sustain competitive advantages in a changing environment (Nelson
1991; Teece, Pisano, and Shuen 1997; Teece 2007).
From a theoretical point of view, the theme emerges and gains strength as the
maintenance of competitive advantage in complex and dynamic environments requires
more than just the development of strategic resources and internal competences of the
firm, as proposed by seminal authors in the field of Resource Based View (Barney 1986).
In practical terms, the topic of dynamic capability gains relevance, especially in
increasingly globalized and dynamic markets, where technological change is rapid and
systemic (Teece 2007).
In order to verify the existence of publications on dynamic capabilities, in the last ten
years, it was decided to carry out a search for articles published on Scopus and Web of
Science (WoS), with the expression “dynamic capabilities.”
In the Web of Science database, the following search filters were performed. In the
initial query, the expression “dynamic capabilities” (all fields) was used, initially locating
94,252 documents. In the first filter, “review articles” were selected, corresponding to
3,430 documents. In the second filter, the term “citation topics meso” was used in the
“management” area, with 483 results. Finally, we sought to identify the five most cited
articles (Table 1).
The following search filters were used in the Scopus database. In the initial query, the
expression “dynamic capabilities” was used in “Title-Abs-Key,” and 6,362 documents
were found. In the first filter, “open access” documents were selected, corresponding to
1,684 documents. In the second filter, documents belonging to the “Business,
Management and Accounting” area were selected, with 1,051 documents located.
Finally, the “document Type” article was searched, with the return of 954 documents.
Adopting the same criteria as the WoS database, the five articles with the highest
number of citations were analyzed (Table 2).
In the analysis of the articles on Tables 1 and 2 it is pointed out that the article
by Teece (2007), which coined the microfoundations of dynamic capabilities, is
cited in all of them, which demonstrates the theory in a paradigmatic way. In
244 M. V. GONCALVES DA SILVA AND J. M. DEL CORSO

Table 1. Bibliometric research on dynamic capabilities.

Title Year Journal Authors Citations
Dynamic capabilities and strategic management 1997 Strategic Management Teece, D.J; Pisano, 13807
Journal G and Shuen, A.
Explicating dynamic capabilities: The nature and 2007 Strategic Management Teece, D.J. 5252
microfoundations of (sustainable) enterprise Journal
performance
Entrepreneurship and dynamic capabilities: 2006 Journal of Zahra, S.A; Sapienza, 1388
A review, model and research agenda Management H.J and Davidsson,
Studies P.
Dynamic capabilities: A review and research agenda 2007 International Journal Wang, C.L. and 1083
of Management Ahmed, P.K.
Reviews
Dynamic Capabilities: A Review of Past Research and 2010 Journal of Barreto, I. 830
an Agenda for the Future Management
Source: Search data.

Table 2. Bibliometric research on dynamic capabilities.

Title Year Journal Authors Citations
Dynamic capabilities and strategic management 1997 Strategic Management Teece, D.J; Pisano, 17194
Journal G. and Shuen, A.
Explicating dynamic capabilities: The nature and 2007 Strategic Management Teece, D.J. 6279
microfoundations of (sustainable) enterprise Journal
performance
Deliberate learning and the evolution of dynamic 2002 Organization Science Zollo, M., Winter, S. 3850
capabilities G.
Understanding dynamic capabilities 2003 Strategic Management Winter, S.G. 2673
Journal
Shaping agility through digital options: 2003 MIS Quarterly: Sambamurthy, V., 2134
Reconceptualizing the role of information Management Bharadwaj, A.,
technology in contemporary firms Information Systems Grover, V.
Source: Search data.

WoS, the article has 5.252 citations and on Scopus there are 6,279 (date from
20 January 2023), considered the leading researcher on dynamic capabilities
theory.
In the article “Dynamic capabilities and strategic management,” dynamic capability is
defined as the firm’s ability to integrate, build and reconfigure external and internal
competencies in rapidly changing environments (Teece et al., 1997, p. 516). Competences
are understood as “the set of organizational routines and processes (specific to the firm),
whose performance is provided by the possession of specific assets (difficult or impos­
sible to imitate). Dynamics are understood as situations in which there are rapid changes
in technology and market forces that have feedback effects on the firm” (Meirelles and
Camargo 2014, 44).
In the work entitled “Explicating dynamic capabilities: The nature and micro founda­
tions of (sustainable) enterprise performance,” carried out a study identifying the micro­
foundations of dynamic capabilities explaining that in the analysis it can be disaggregated
into three organizational categories: sensing refers to the activity of investigating and
identifying market and technology trends and opportunities; seizing – these are organi­
zational structures and procedures for seizing opportunities. From the moment trends
(technology and market) are identified, the organization must invest in activities for the
development and commercialization of new products, processes and services; and
 DEFENCE STUDIES 245

reconfiguring –new creations and/or reconfigurations of organizational assets, according

to technological and market changes (Teece 2007).
It appears that the organization must be constantly prepared to identify and take
advantage of opportunities, and reconfigure its assets, in order to create an enabling
environment to develop its dynamic capabilities. Thus, strategic thinking must promote
reflection on the constantly changing environment in which the organization is inserted,
essential to ensure its competitiveness and sustainability.

4. Methodology
DCs can be analyzed through in-depth qualitative research (Lee and Teece 2013). Case
studies can produce significant insights to contribute to the development of theory in
dynamic capabilities (Danneels 2011).
The present research is classified from the point of view of the approach to the
problem, as qualitative, using the single case study method (Eisenhardt 1989). From
the point of view of how to approach the objectives, this research is characterized as
descriptive, since it aims to analyze how the micro foundations of dynamic capacity,
through the lens of strategy as practice, can contribute to the identification of the origins
of capacity dynamics.
The selection of the case was not random, but intentional, as the case is conducive to
studying the categories to be analyzed, that is, the selected company presents specific
conditions that favor the study of the micro foundations of dynamic capacity, through
from the perspective of strategy as practice (Eisenhardt 1989; Yin 2005).
The single case study, due to its particularity, seeks to deeply research an object,
allowing to know it in a broad and detailed way (Stake 1995). The case study is
intrinsically analytical, rather than statistical, as it seeks to generalize theoretical proposi­
tions (Gates and Schwandt 2018). However, more than the production of generalizations,
the method is focused on the particularization of the investigated case (Stake 1995).
In order to validate the instrument developed in this study, called Dynamic
Capabilities in Defense (DC-Defense), it was decided to carry it out at the Brazilian
War Material Industry (IMBEL). As for the selection criteria, the choice for IMBEL
considered that it is the oldest company in the country’s defense sector, as well as its
know-how of senior management in the market of war products. There was also an
opportunity to align the research with one of IMBEL’s strategic objectives, to become, by
2026, an independent public company, which means, to have no dependence on
resources from the Union (Imbel 2021).
Thus, the choice of the IMBEL case for this study follows the proposed which the
decision is guided by the criterion of maximizing what can be learned about the
phenomenon from the chosen case (Stake 1995). In addition, the choice is guided by
the receptivity of the case to the research and the researcher’s access to the industry,
which constitutes one of the biggest challenges faced by the researchers when the theme is
Industrial Defense Base, due to the companies’ industrial secrecy, regarding the results on
technology and production, trade, the labor market, research, development, and
innovation.
In this study, the method used, was based on two criteria: in terms of ends and in
terms of means (Vergara 2004). As for the purposes, the research can be classified as
246 M. V. GONCALVES DA SILVA AND J. M. DEL CORSO

exploratory, since the proposal of a model of dimensions of dynamic capabilities for

Strategic Defense Companies, in addition to being unprecedented, lacks an initial
approach and theoretical-applied deepening.
As for the means, the investigation is of a documentary nature, which allowed, from
the theory of dynamic capabilities, to relate the microfoundations with the Strategic
Defense Actions (SDA) of the National Defense Strategy (Teece 2007; Brasil 2020).
As for the technique for data collection, a questionnaire was prepared in Google
Forms, with structured questions, and in the response option, the Likert scale was used,
with an interval from 1 to 3, corresponding to: 1- none, 2- partially and 3- fully.
The survey was sent by e-mail, for pre-test purposes, to the manager of a Strategic
Defense Company. After the responses were returned, the necessary adjustments were
made, such as the insertion of some variables and the exclusion of others.
The questions were answered by the Management and Planning Advisor of IMBEL,
returning on 7 November 2020. The respondent informed that for the preparation of the
answers, the President, Administrative Director, Industrial Director and Market Director
were consulted. The questions in the questionnaire, composed by the DC-Defense
indicators. The questions in the questionnaire, composed by the DC-Defense indicators,
according to Table 4 of section 6.

4.1 Codification of strategic defense actions and dynamic capabilities

In the document analysis, the National Defense Strategy ([END], Brasil 2020), elaborate
by the Defense Ministry, was used to codify the Strategic Defense Actions (SDAs).
Defense Strategies (DS) must be directly aligned with the National Defense Goals
(NDG), established in the National Defense Policy (NDP). SDAs are incorporated into
each Defense Strategies (DS), which aim to guide the measures that must be implemented
to achieve the NDGs. A DS can contribute to more than one NDG, and the same occurs
with SDAs in relation to Strategies. In this case, they can be of identical or different
natures.
In this study, the analysis was delimited in NDG III, which aims to − promote
technological and productive autonomy in the area of defense (Brasil 2020). In NDG
III, DSs 8 and 9 deal specifically with the defense industrial environment.
Dynamic capabilities can be perceived as a management mechanism, allowing new
organizational, functional and technological combinations, with the objective of under­
standing, exploring and consolidating the specific competences of the company (Teece
et al., 1997).
DS8 − Promotion of the Sustainability of the Defense Industrial Base Production
Chain − aims to provide conditions of stability to the activities of financing, research,
development, production and sale of Brazilian defense products and to provide sustain­
ability conditions for the production chain, even if subject to special legal, regulatory and
tax regimes.
Meanwhile, DS9 − Strengthening the Defense Science and Technology Area − aims at
the development and solidity of the ST&I area in defense matters, promoting the
absorption, by the production chain, of indispensable knowledge for the gradual reduc­
tion of dependence on technology external. In the DS8 and DS9, the SDAs dealing with
 DEFENCE STUDIES 247

Table 3. Categorization of Dynamic Capabilities in Defense (DC-Defense).

Strategic Defense Actions (SDA)
SDA39- Stimulate defense interest projects that
employ dual products and technologies
SDA45- Promote exports from the Defense Industrial DCD04 The company is able to enter into bilateral
Base
SDA46- Promote the increase of local content in
Defense Industrial Base products
SDA49- Promote the development of defense-critical DCD08 The company has the capacity to carry out Research,
technologies
SDA50- Improve the integration model of the
Government/Academy/Company triad
SDA54- Stimulate the establishment of partnerships DCD11 The company has the capacity to seek integration
and exchanges in the area of research into
technologies of defense interest
SDA57- To promote the integration of the Defense
Sector in the areas of metrology, standardization
and certification of products, services and Defense
Systems - Prode, concerning the Defense Industrial
Base
Source: search data.
Indicator Description
DCD01 The company has the capacity to produce dual-use
materials.
DCD02 The company has the ability to not depend on
government purchases (defense procurement).
DCD03 The company has the ability to diversify made-to-
order defense products.
agreements for sales between governments
(government to government).
DCD05 The company has the capacity to develop
indigenous technology.
DCD06 The company has the ability to supply defense
products in the domestic market.
DCD07 The company has the ability to provide defense
products not available from other companies.
Development and Innovation (RD&I) internally.
DCD09 The company has the capacity to carry out projects
involving actors of the triple helix model.
DCD10 The company has the ability to foster innovation
through partnerships with technology parks and/
or startups.
with Science and Technology Institutes (ICT).
DCD12 The company has the capacity to absorb technology
(spin in).
DCD13 The company has the ability to carry out tests and
evaluations of defense products and systems.

the defense industrial environment correspond to the SDA 39, 45, 46, 49, 50, 54 and 57
(Table 3).
The list of SDA categories represents the general form of the concept that brings
together a set of registration units considering their importance and the regularity with
which they appear. The registration units served for the codification of the questionnaire
applied in IMBEL, in order to verify which are the dynamic capacities identified in
IMBEL, elaborated from the SDA.
It can be seen from Table 3 that the categorization of dynamic capabilities – DCD01 to
DCD13 − aims at the elaboration of the DC-Defense instrument, in line with the SDAs of
the NDS.

5. The case of the Brazilian war material industry

IMBEL is a company constituted under the terms of Law nº 6.227, of 14 July 1975,
considered a dependent public company, with legal personality of private law, linked to
the Ministry of Defense, through the Army Command. IMBEL is part of the Brazilian
DIB, being established as a Strategic Defense Company (SDC) since 2013. The company
consists of a headquarters, located in Brasília/DF, and five Production Units (PU),
distributed in the three states of the southeast region, with a total number of 1,963
employees.
248 M. V. GONCALVES DA SILVA AND J. M. DEL CORSO

Table 4. Answers to the questionnaire applied to IMBEL.

Indicator Description 1- None 2- Parcially 3- Fully
DCD01 The company has the capacity to produce dual-use materials.
DCD02 The company has the ability to not depend on government purchases
(defense procurement).
DCD03 The company has the ability to diversify made-to-order defense products.
DCD04 The company is able to enter into bilateral agreements for sales
between governments (government to government).
DCD05 The company has the capacity to develop indigenous technology.
DCD06 The company has the ability to supply defense products in the
domestic market.
DCD07 The company has the ability to provide defense products not available
from other companies.
DCD08 The company has the capacity to carry out Research, Development and
Innovation (RD&I) internally.
DCD09 The company has the capacity to carry out projects involving actors of
the triple helix model.
DCD10 The company has the ability to foster innovation through partnerships
with technology parks and/or startups.
DCD11 The company has the capacity to seek integration with Science and
Technology Institutes (ICT).
DCD12 The company has the capacity to absorb technology (spin in).
DCD13 The company has the ability to carry out tests and evaluations of
defense products and systems.
Source: research data.

The Presidente Vargas Factory (FPV) is located in Piquete/SP, has 416 employees and
produces gunpowder, propellant grains and explosives. The Estrela Factory (FE), is in the
city of Magé/RJ, has 337 employees and produces explosives, detonation accessories and
pyrotechnics. Itajubá Factory (FI), in Itajubá/MG, has 689 employees and is responsible
for the production of delight weapons (rifles, pistols and carbines). Juiz de Fora Factory
(FJF), located in the city of Juiz de Fora/MG, has 235 employees, and manufactures large
caliber ammunition. The Communications and Electronics Material Factory (FMCE),
based in Rio de Janeiro/RJ, has 127 employees and produces computer operating systems,
radio equipment, switches and telephones. IMBEL’s head office is located in Brasília/DF
and has 159 employees (Imbel, 2020).
IMBEL manufactures and markets defense and security products for institutional
clients, especially the Armed Forces, public security forces and private clients. The
main products manufactured and marketed by the company are rifles, pistols and
carbines; artillery, mortar and tank munitions; gunpowder, explosives and accessories;
communications and electronics equipment; and temporary campaign, humanitarian
and civil defense shelter systems (Imbel 2021).
Strategically, IMBEL’s mission is to provide defense and security solutions with high
technological content, while remaining able to meet the needs of industrial mobilization
and promote the national defense industry, and, as a vision of the future, it intends to be
recognized in the national market and internationally as a company of excellence in the
development, manufacture and supply of defense and security solutions (Imbel 2021).

6. Results
The questionnaire, prepared in Google Forms, was sent by email to the President of
IMBEL, on 5 November 2020. The questions were answered by the Management and
 DEFENCE STUDIES 249

Planning Advisor of IMBEL, returning on 7 November 2020. The respondent informed

that for the preparation of the answers, the President, Administrative Director, Industrial
Director and Market Director were consulted. The questions in the questionnaire,
composed by the DC-Defense indicators, as well as its answers are described in Table 4.
Of the 13 (thirteen) DC-Defense, 09 (nine) were considered to be partially acquired,
and 04 (four) were considered to be fully acquired. There were no responses for any
capacity.
However, such capabilities may have been obtained in an emergent way, that is,
organizational practice spontaneously promoted the phenomenon of learning, charac­
teristics observed in innovative organizations (Mintzberg 1979). In the same sense,
capabilities may have been acquired through routines and the way in which such routines
were effectively performed against competitors (Winter & Zollo, 2002).
The DC-Defense considered partially acquired by IMBEL (DCD02, DCD03, DCD04,
DCD05, DCD06, DCD07, DCD08, DCD10, DCD12 and DCD13) demonstrate that the
company, albeit incipiently, has the capacity to adapt to the dynamism of the defense
market environment, making it possible to achieve and sustain competitive advantages,
related to the descriptions in Table 3.
The DC-Defense fully acquired were: DCD01- The company has the capacity to
produce dual-use materials, DCD06- The company has the capacity to supply defense
products in the domestic market, DCD09- The company has the capacity to carry out
projects involving actors of the triple helix and DCD11- The company has the ability to
seek integration with Institutes of Science and Technology (ICT). These DC-Defense
correspond to SDAs 39 (DCD01), 46 (DCD06), 50 (DCD09) and 54 (DCD011) that make
up the NDG III, of the NDS (Brasil 2020), which aim to promote technological and
productive autonomy in the area of defense.
We sought to relate the DC-Defense acquired fully by IMBEL with the microfounda­
tions of the dynamic capabilities (Teece 2007) and we find that DCD11 (The company
has the capacity to seek integration with Institutes of Science and Technology) corre­
sponds to the seising; the DCD01 (The company has the capacity to produce dual-use
materials) and DCD06 (The company has the capacity to supply defense products in the
domestic market) corresponds to seizing, and DCD09 (The company has the capacity to
carry out projects involving actors of the triple helix model) corresponds to reconfiguring.
The DC-Defense fully acquired by IMBEL are related to the micro-fundamentals
sensing, seizing and reconfiguring. In the field of strategic management, the IMBEL
structure, mediated by the behavior of its senior management and the Brazilian Army,
are determining factors for the improvement of dynamic capabilities, in order to con­
tribute to the development of the Defense Industrial Base ecosystem.
Microfoundation sensing involves actions that aim to create hypotheses about the
future implications of technology and market trends, and to test hypotheses in order to
clarify the path for the creation of new products, services and new business models. This
is the result of IMBEL supplying defense products, in order to meet, on demand, the
strategic projects of the Brazilian Army, with the use of technologies developed in an
autochthonous way, by researchers from the Military Institute of Engineering (IME), and
through partnerships with Science and Technology Institutes.
The seizing microfoundation denotes the ability of IMBEL to produce materials and
weapons for dual use (civilian and military), being a differentiating factor in the market,
250 M. V. GONCALVES DA SILVA AND J. M. DEL CORSO

given the company’s strategy not to depend solely on government purchases, character­
istic of the oligopsony market, due to budgetary restrictions caused by periodic crises,
characteristic of emerging countries.
As for the reconfiguration microfoundation, it appears that IMBEL seeks to remain
competitive, through the combination of its tangible and intangible assets, through open
innovation, based on the search for external knowledge to assist and accelerate the
internal innovation process (Chesbrough 2012). And there is relationship with the actors
of the triple helix model, that is, the interaction with the university and the government
(Etzkowitz and Leydesdorff 2000).
The microfoundations of sensing, seizing and reconfiguration are essential for the
company to sustain itself in the long term, as customers, competitors and technologies
change dynamically and constantly (Teece 2007).

7. Conclusions
The article made it possible to answer the research question. When analyzing the DC-
Defense identified in IMBEL, it appears that most are aligned with the Strategic Defense
Actions present in the National Defense Strategy. The dynamic capabilities related to
NDS, even though they present emergent characteristics, can result from the organiza­
tional practice promoted spontaneously, through the phenomenon of learning, observed
in innovative organizations.
It is noted that through the DC-Defense constructs, IMBEL’s competitive advan­
tage is feasible and can be achieved through the combination of the use of internal
resources, of its existing capabilities, and the acquisition of learning and technolo­
gies from external sources to the production and sale of products with high added
value.
However, in the context of dynamic capabilities theory, it is accepted that not all
competencies are equally important for competitive advantage, so that a given Strategic
Defense Company can excel in a relatively restricted number of competencies.
In the same way, the dynamic capabilities stream seeks to provide an explanation of
how firms can act to reconfigure, proactively or reactively, their resource base. At this
point, the strategic intention of IMBEL to become a public company independent of the
Union budget is verified.
It should be noted that in 2021, the Interministerial Ordinance MD/ME No. 4,886 was
published, which aims to identify, together with Defense Companies – DC and Strategic
Defense Companies – SDC, information that contributes to the conduct of policies aimed
at promoting the defense industry, with regard to results on technology and production,
trade, labor market, research, development and innovation (Brasil 2021).
The ordinance published, in a timely manner, corroborates the assumption of this
research, that defense policymakers should know the capabilities of defense industries in
order to conduct strategies and policies to encourage the DIB, as described above
Art. 1 This Interministerial Ordinance provides for the Annual Report on the Results of the
Defense Industrial Base - RARBID, which is dealt with in art. 10 of Decree No. 7,970, of
March 28, 2013, with the objective of identifying, together with Defense Companies - DC
and Strategic Defense Companies - SDC, information that contributes to the conduct of
policies aimed at promoting the defense industry, regarding the results on technology and
 DEFENCE STUDIES 251

production, trade, labor market, research, development and innovation (Brasil 2021, n.p.,
our emphasis).

The DC-Defense instrument, which is easy and simple to use, can contribute in
a pragmatic and managerial way to Strategic Defense Companies, so that they can
learn about their dynamic capabilities and set goals in their strategic plans, which allow
them to generate competitive advantage.
As a research limitation, it is pointed out the study of a single case, IMBEL, but the
data of Strategic Defense Companies are not available, due to the complexity and
sensitivity of the products and technologies involved, which demands secrecy on the
part of the high management.
As a recommendation for future studies, it is suggested to try to apply the DC-Defense
together with other Strategic Defense Companies or even Defense Companies, in order to
ratify or rectify the results obtained in this study or even expand to a sample larger, for
a quantitative study.

Disclosure statement
No potential conflict of interest was reported by the authors.

Notes on contributors
Marcus Vinicius Gonçalves da Silva Brazilian Army Officer, with over 30 years of service.
Graduated in Administration, Specialist in Public Management and has a Master’s degree in
Planning and Public Governance. (Co)author of three books: Public Policies, Personnel
Management in the Public Service, Internal and External Control, and Fundamentals of Public
Management. In the doctoral program, carried out research on in the area of National Defense,
particularly, in the analysis of organizational performance and dynamic capabilities of Strategic
Defense Companies linked to the Defense Industrial Base.
Jansen Maia Del Corso Full Professor in the Master’s and Doctoral Program in Administration at
the Pontifical Catholic University of Paraná, Brazil, where coordinates and supervises research
projects in Organizational Planning and Organizational Design/Modeling. Article reviewer for
several national and international magazines. Consultant and Speaker on Strategic Organizational
Management in Public and Private Organizations.

ORCID
Marcus Vinicius Gonçalves da Silva http://orcid.org/0000-0003-2145-0871
Jansen Maia Del Corso http://orcid.org/0000-0003-4493-1627

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