Final answer:
Professor Capshew's observation suggests that universities are both traditional and innovative in nature.
Step-by-step explanation:
Professor Capshew's observation that "The university is a traditional institution dedicated to innovation" suggests that universities have a long history and established traditions, but at the same time, they prioritize and promote new ideas and progress. This can be seen in various aspects of a university's activities, such as research, curriculum development, and the fostering of critical thinking and intellectual exploration.