This research examines the theoretical application of dynamic capabilities to project capabilities within a transformation context. There has been a poor understanding of how a public service provider's benefits can be achieved through information systems. To establish a research agenda about the necessity of a public service provider's dynamic capabilities, this study develops a theoretical approach to project capabilities by distinguishing the dynamic capabilities of a public service provider from the operational capabilities of technology suppliers. The theoretical foundation will be highlighted by pointing out the disjunction between project and benefits management. Extant literature will be reviewed including benefits realisation from information systems and dynamic capabilities for organisational transformation. This study offers an original contribution in that project management and benefits realisation disciplines are combined by applying the context of dynamic capabilities. Thus, the importance of a public service provider's transformation from a project to an operational system is emphasised.