Organisational adaptations : a pluralistic perspective 978-3-319-63510-1, 3319635107, 978-3-319-63509-5

Table of contents :
Front Matter ....Pages i-xviii
Introduction (Oluwaseun E. Adegbite, Antonis C. Simintiras, Yogesh K. Dwivedi, Kemefasu Ifie)....Pages 1-9
The Organisation Business Environment (Oluwaseun E. Adegbite, Antonis C. Simintiras, Yogesh K. Dwivedi, Kemefasu Ifie)....Pages 11-26
Organisational Concepts and Theories of Adaptation (Oluwaseun E. Adegbite, Antonis C. Simintiras, Yogesh K. Dwivedi, Kemefasu Ifie)....Pages 27-48
Adaptive Behaviour Paradigms (Oluwaseun E. Adegbite, Antonis C. Simintiras, Yogesh K. Dwivedi, Kemefasu Ifie)....Pages 49-80
Dynamic Capabilities: Drivers of Organisational Adaptations (Oluwaseun E. Adegbite, Antonis C. Simintiras, Yogesh K. Dwivedi, Kemefasu Ifie)....Pages 81-94
Adaptations in Management Studies and Methodological Approaches in Adaptations (Oluwaseun E. Adegbite, Antonis C. Simintiras, Yogesh K. Dwivedi, Kemefasu Ifie)....Pages 95-125
Summing Up Organisational Adaptations (Oluwaseun E. Adegbite, Antonis C. Simintiras, Yogesh K. Dwivedi, Kemefasu Ifie)....Pages 127-138
Back Matter ....Pages 139-167

Citation preview

SPRINGER BRIEFS IN BUSINESS

Oluwaseun E. Adegbite Antonis C. Simintiras Yogesh K. Dwivedi Kemefasu Ifie

Organisational Adaptations A Pluralistic Perspective

123

SpringerBriefs in Business

More information about this series: http://www.springer.com/series/8860

Oluwaseun E. Adegbite  •  Antonis C. Simintiras Yogesh K. Dwivedi • Kemefasu Ifie

Organisational Adaptations A Pluralistic Perspective

A comprehensive review and analysis of concepts and underlying paradigms that underpin success and failure in adaptation processes.

Oluwaseun E. Adegbite School of Management Swansea University Swansea, United Kingdom

Antonis C. Simintiras College of Business Administration Gulf University for Science and Technology Hawally Kuwait

Yogesh K. Dwivedi Emerging Markets Research Centre (EMaRC), School of Management Swansea University Swansea, United Kingdom

School of Management, Swansea University Swansea, United Kingdom Kemefasu Ifie School of Business and Economics Loughborough University, Loughborough Leicestershire United Kingdom

ISSN 2191-5482     ISSN 2191-5490 (electronic) SpringerBriefs in Business ISBN 978-3-319-63509-5    ISBN 978-3-319-63510-1 (eBook) DOI 10.1007/978-3-319-63510-1 Library of Congress Control Number: 2017946314 © The Author(s) 2018 This work is subject to copyright. All rights are reserved by the Publisher, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and transmission or information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now known or hereafter developed. The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. The publisher, the authors and the editors are safe to assume that the advice and information in this book are believed to be true and accurate at the date of publication. Neither the publisher nor the authors or the editors give a warranty, express or implied, with respect to the material contained herein or for any errors or omissions that may have been made. The publisher remains neutral with regard to jurisdictional claims in published maps and institutional affiliations. Printed on acid-free paper This Springer imprint is published by Springer Nature The registered company is Springer International Publishing AG The registered company address is: Gewerbestrasse 11, 6330 Cham, Switzerland

To my parents from whom I have learnt and seen resilience and tenacity of purpose. –Oluwaseun E. Adegbite To Mary and Constantine. –Antonis C. Simintiras To Anju, Shagun and Saanvi. –Yogesh K. Dwivedi To Pereye. –Kemefasu Ifie

Preface

It all started with a thought (just like a seed!) during summer 2014. After careful thinking of how individuals and businesses cope and soar amidst everyday challenges, we decided to undertake a study in this respect. To some extent, the thought of how enterprises adapt to challenges in their business environments reflects how we individuals cope with challenges that life throws at us. Organisations are ‘individual’ – entities in their own rights. Businesses have devised ways of surviving their environments. They do this by downsizing, merger and acquisition, business ecosystems, and through other forms of collaborations and strategic alliances. While this is true, current research works into generic predictors and/or concepts that enhance the transformation process are short in supply. Research in this respect is vital for both theory development and practice. This is particularly important so as to align the theories and concepts of organisational adaptations with realities in the business environment. Thus, there is need to explore this gap through a painstaking study. With this in mind, a thorough review of literature into adaptations in organisations will be a good starting point. These considerations led to writing this important monograph. We hope readers find it insightful, enriching and resourceful. Not only in knowledge about adaptations in organisations but more importantly how the enumerated suggestions help business executives adapt and thrive in their dynamic business environments. The monograph purposefully takes a generic approach with the hope that it will be applicable to many areas in the field of business management. A case study of how Kodak and Fujifilm responded to digitalisation of photographic film industry was deliberately selected for this study. This was borne out of the global application and relevance of digital technology to contemporary businesses. It was also selected because it was an example of a major adaptation challenge. This is an important case of technology discontinuity and change in customers’ tastes and preferences. We argue that many global brands are often contending with such similar issues and real-life challenges. Simply put, today’s business environment demands a new way of doing business that challenges brands’ existing core business philosophy. It is an indisputable fact that contemporary business organisations operate in very challenging business environments regardless of the industry. The advent of vii

viii

Preface

globalisation, advancement in technology, fierce competition, unstable (fragile) global economic outlook, cloudy world political trends (e.g. BREXIT and EU face-­­ ­off and implications for global trade, US presidency, Russia and China influence in world political arena), government regulations and of course the persistent demand for increase in value for products/services/expertise offerings at both B2B and B2C levels call for rethink in the way of doing business. This necessitates that firms must continuously strive to remain competitive in their products offerings. Of all the identified influences, we argue that fragile global economic outlook, technological advancement and increasing customers’ knowledge that influence their tastes and preferences are the most pressing for business organisations. These factors call for rethink/modification(s) in how businesses are conducted. In many industries, the era of being long-term market leader has since passed. The focus has shifted to continuously adapting business resources (in most instances, coupled with customers’ resources) to gain either temporary advantage over competitors or developing competitive advantage which may either be outdated by prevailing market exigencies or need continuous reviewing. The story is not different in every aspect of business management—sales and marketing, operational management, e-business, human resource management and supply chain management. No industry is spared although the need for organisational modification varies from industry to industry. It is visibly noticed in sectors that are highly dependent on information communication technology. Of note are the entertainment industry (football business, music, movies and other affiliated sectors), automobile industry and most especially the unabated competition in smartphones, computer games and other associated information technology industries. So then what is the way forward to survive the onslaught of the highly dynamic business environment? We argue the answer is continuously adapting organisational resources to achieve corporate goals and objectives. Organisational adaptations do come with their attendant challenges while it may be relatively possible for small size or young firms to adapt its resources to the caprices of its business environment; the story in most cases cannot be assumed for matured, large size multinational firms. The process of adaptations in small and moderate size firms is complex, intriguing and demanding. The process is even more daunting in large firms particularly those operating in high volatile markets; yet it is an unavoidable reality every executive must face in order to remain competitive and ensure superior firm performance. So then how can firm confront various strategic managerial challenges confronting them? How can they effectively manoeuvre and navigate highly fluid corporate business environment using executive radar without compromising value or superior performance for firm survival? We offer some suggestions and insights into this organisational phenomenon. While it is construed that the concept of organisational adaptations exists in many management literatures, what is evidently lacking is a pluralistic approach that underpins the fundamental concepts and processes in which adaptations take place. A pluralistic approach provides an insight into the complex nature of this important organisational concept.

Preface

ix

The continued scholarly work on this subject will raise the possibility of enhancing firm survival. This monograph is placed as an important leap in this regard. It suggests the critical elements within the organisations that every executive must address in order to remain competitive. It takes a pluralist approach in trying to broaden our knowledge on organisational adaptations. An exploratory delve into existing literature in organisational study was employed with biased for content, context and process framework and processual analytic case study approach in an attempt to identify, determine and understand the intricacies of adaptations going on in various business organisations.

Contents

1 Introduction����������������������������������������������������������������������������������������������    1 1.1 Organisational Adaptations: A Pluralistic Perspective����������������������    1 1.2 Why a Pluralistic Perspective?����������������������������������������������������������    4 1.3 Differences Between Change and Adaptation����������������������������������    6 1.4 Aim and Objectives��������������������������������������������������������������������������    7 1.5 Content, Context and Process (CCP) Framework, Processual and Case Study Analysis������������������������������������������������    8 1.6 Structure of Monograph��������������������������������������������������������������������    9 2 The Organisation Business Environment����������������������������������������������   11 2.1 The Dimensions of Business Environment����������������������������������������  11 2.2 Environmental Uncertainty ��������������������������������������������������������������   12 2.3 Environmental Complexity ��������������������������������������������������������������   14 2.4 Environmental Munificence��������������������������������������������������������������   16 2.4.1 Environmental Munificence Levels��������������������������������������   17 2.4.2 Environmental Munificence Types���������������������������������������   20 2.5 Discussion and Concluding Points on Business Environments������������������������������������������������������������������������������������   24 3 Organisational Concepts and Theories of Adaptation ������������������������   27 3.1 Resource-Based View (RBV)�����������������������������������������������������������   28 3.2 Contingency [or Environmental Contingency] Theory��������������������   29 3.2.1 Organisational Performance��������������������������������������������������   30 3.2.2 Power Factors������������������������������������������������������������������������   30 3.2.3 Causal Relationship��������������������������������������������������������������   30 3.2.4 Independent Variables ����������������������������������������������������������   31 3.2.5 Multiple Contingencies��������������������������������������������������������   31 3.2.6 Planned Change��������������������������������������������������������������������   31 3.2.7 Scheduling of Organisational Change����������������������������������   31

xi

xii

Contents

3.3 Strategic Choice Theory��������������������������������������������������������������������   32 3.3.1 The Human Agency and Choice ������������������������������������������   32 3.3.2 The Nature of Environment��������������������������������������������������   33 3.3.3 The Quality of Relationship Between the Organisational Agent and the Environment��������������������������������������������������   33 3.4 Resource Dependence Theory (RDT)����������������������������������������������   34 3.5 Organisational Ecology (OE)������������������������������������������������������������   34 3.6 Organisational Behaviour ����������������������������������������������������������������   35 3.7 Institutional Theory��������������������������������������������������������������������������   36 3.8 Organisation Ambidexterity��������������������������������������������������������������   37 3.9 Interpretative Perspective������������������������������������������������������������������   38 3.10 Transaction Cost Economics (TCE) ������������������������������������������������   39 3.11 Complexity Theory ��������������������������������������������������������������������������   40 3.12 The Law of Requisite Variety (LRV)������������������������������������������������   42 3.13 Management Studies and Theoretical Perspectives��������������������������   43 3.14 Discussion and Conclusion of Organisational Concepts and Theories��������������������������������������������������������������������������������������   43 4 Adaptive Behaviour Paradigms��������������������������������������������������������������   49 4.1 Adaptive Behaviour Paradigm Explained ����������������������������������������   49 4.2 Market Orientation (MO)������������������������������������������������������������������   51 4.2.1 Information (Intelligence) Gathering������������������������������������   53 4.2.2 Information Dissemination ��������������������������������������������������   54 4.2.3 Responsiveness ��������������������������������������������������������������������   54 4.3 Entrepreneurial Orientation (EO) ����������������������������������������������������   55 4.3.1 Autonomy ����������������������������������������������������������������������������   57 4.3.2 Innovativeness����������������������������������������������������������������������   57 4.3.3 Risk Taking ��������������������������������������������������������������������������   58 4.3.4 Proactiveness������������������������������������������������������������������������   58 4.3.5 Competitive Aggressiveness ������������������������������������������������   59 4.4 Time Orientation ������������������������������������������������������������������������������   60 4.5 Learning Orientation������������������������������������������������������������������������   62 4.6 Managerial Orientation (MNO)��������������������������������������������������������   65 4.7 Firm Resources and Reconfiguration Orientation (FRRO)��������������   66 4.8 Strategic Orientation (SO)����������������������������������������������������������������   68 4.8.1 Linear Strategy Model����������������������������������������������������������   69 4.8.2 Adaptive Strategy Model������������������������������������������������������   70 4.8.3 Interpretive Strategy Model��������������������������������������������������   70 4.9 Stakeholder Orientation��������������������������������������������������������������������   74 4.10 Firm’s Structure and Production Architecture (FSPA) ��������������������   75 4.11 Discussion and Conclusion on Adaptive Behaviour Paradigms������������������������������������������������������������������������   76

Contents

xiii

5 Dynamic Capabilities: Drivers of Organisational Adaptations ����������   81 5.1 Dynamic Capabilities in Organisational Adaptation������������������������   82 5.2 Dynamic Capabilities as Drivers of Organisational Adaptations������   82 5.3 The Challenges of Dynamic Capabilities in Adaptation Processes ������������������������������������������������������������������������������������������   85 5.3.1 The Challenge of Recursiveness in Dynamic Capabilities ��������������������������������������������������������������������������   87 5.3.2 The Challenge of Solving Organisational Problems with Dynamic Capabilities����������������������������������������������������   89 5.4 Modes of Organisational Adaptations����������������������������������������������   90 5.4.1 Unstable Mode����������������������������������������������������������������������   90 5.4.2 Stable Mode��������������������������������������������������������������������������   91 5.4.3 Neutral Mode������������������������������������������������������������������������   91 5.5 Discussion and Conclusion on Dynamic Capabilities����������������������   92 6 Adaptations in Management Studies and Methodological Approaches in Adaptations ��������������������������������������������������������������������   95 6.1 General Overview of Adaptations in Management Studies��������������   95 6.2 Adaptations in Business Relationships ��������������������������������������������   97 6.3 Types of Adaptations in Business Relationships������������������������������   99 6.4 Towards a Synthesised Methodology in Organisational Adaptations ��������������������������������������������������������������������������������������  100 6.4.1 Overview of CCP Framework����������������������������������������������  100 6.4.2 Process and Processual Analysis������������������������������������������  101 6.5 Processual Analysis��������������������������������������������������������������������������  102 6.6 Case Study Method ��������������������������������������������������������������������������  104 6.7 Research Design��������������������������������������������������������������������������������  105 6.8 Discussion and Summary on CCP, Processual Analysis and Case Study Method ����������������������������������������������������  106 6.9 CCP and Case Study Analysis in Digitalisation of Photographic Industry������������������������������������������������������������������  107 6.10 Investigating Photographic Industry: A Synthesised Research Method������������������������������������������������������������������������������  107 6.11 Photographic Industry 1960–1999����������������������������������������������������  108 6.12 Kodak: Its Beginning, Landmarks and Market Supremacy��������������  108 6.13 Kodak’s Winning (Adaptive) Strategies��������������������������������������������  109 6.14 Kodak’s Waning Strategies and Market Dominance������������������������  110 6.15 Fujifilm’s Route to Market Survival and Superior Firm Performance ����������������������������������������������������������������������������  111 6.16 Photographic Industry 2000–2016����������������������������������������������������  112 6.17 Kodak’s Adaptive Dilemma��������������������������������������������������������������  113 6.18 The Adaptive Behaviour Paradigms Analytical Framework������������  117 6.19 Discussion and Conclusion on Adaptations in Management Studies and Methodological Approaches in Organisational Adaptations ��������������������������������������������������������������������������������������  120

xiv

Contents

7 Summing Up Organisational Adaptations��������������������������������������������  127 7.1 Further Insights from the Case Study ����������������������������������������������  127 7.2 The Other Side of Organisational Adaptations ��������������������������������  130 7.3 Organisational Inertia������������������������������������������������������������������������  130 7.4 Excessive Adaptation������������������������������������������������������������������������  132 7.5 Presumptive Adaptation��������������������������������������������������������������������  133 7.6 Liability of Recursiveness����������������������������������������������������������������  133 7.7 Organisational Amnesia��������������������������������������������������������������������  134 7.8 Discussions and Conclusion on the Other Side of Organisational Adaptations����������������������������������������������������������  134 7.9 Concluding Highlights����������������������������������������������������������������������  136 7.10 Limitation of Study and Suggestions for Further Research��������������  137 7.11 In Closing������������������������������������������������������������������������������������������  137 References ��������������������������������������������������������������������������������������������������������  139 Index������������������������������������������������������������������������������������������������������������������  165

Acronyms

ABP BREXIT CAS CCP framework DC EO EU Firm’s DNA FRRO FSPA LO LRV MNO MO OE OLC RBV RDT SBU SO SON

Adaptive behaviour paradigm ‘Britain’ and ‘exit’ (Britain exits EU) Complex adaptive systems Content, context and process framework Dynamic capabilities Entrepreneurial orientation European Union Refers to the core unique characteristic of the firm Firm resources reconfiguration orientation Firm structure and production architecture Learning orientation The law of requisite variety Managerial orientation Market orientation Organisational ecology Organisational life cycle Resource-based view Resource dependence theory Strategic business unit Stakeholder orientation Strategic orientation

xv

About the Authors

Oluwaseun  E.  Adegbite  is a Ph.D. candidate at the School of Management, Swansea University, UK.  He obtained a BTech in Animal Production and Health from Ladoke Akintola University, Ogbomosho, Nigeria, and MBA from Swansea University, Swansea, Wales, UK. He has attended and presented some of his research works in local, national and international workshops, doctoral colloquial and conferences. Some of these are British Academy Management 2016 Doctoral Colloquium and IFIP WG 6.11 I3E2016 Conference. Prior to venturing into postgraduate research, he has worked in various public and private firms both in Nigeria and in the UK. He is versatile and enjoys critically examination of complex issues in management. His current doctoral research is on sales process adaptation in dyadic relationships. Yogesh K. Dwivedi  is a Professor of Digital Marketing and Innovation, Director of the Emerging Markets Research Centre (EMaRC) and Director of Research in the School of Management at Swansea University, Wales, UK. His research interests are in the area of information systems (IS) including the adoption and diffusion of emerging ICTs and digital and social media marketing particularly in the context of emerging markets. He has published more than 250 articles in a range of leading academic journals and conferences. He has co-edited/co-authored more than 20 books on technology adoption, e-government, IS theory, eWOM and social media and had them published by international publishers such as Chandos Publishing (an imprint of Elsevier), Springer, Chapman and Hall/CRC Press, Routledge and Emerald. He is the founding series editor of the recently established Springer book series Advances in Theory and Practice of Emerging Markets. He acted as co-editor of 15 journal special issues; organised tracks, mini-tracks and panels in leading conferences; and served as programme co-chair of 2013 IFIP WG 8.6 Conference on Grand Successes and Failures in IT: Public and Private Sectors and Conference Chair of IFIP WG 6.11 I3E2016 Conference on Social Media: The Good, the Bad, and the Ugly. He is an Associate Editor of European Journal of Marketing and Government Information Quarterly and Senior Editor of Journal of Electronic Commerce Research. More information about me can be obtained from http://www. swansea.ac.uk/staff/som/academic-staff/y.k.dwivedi/. xvii

xviii

About the Authors

Kemefasu  Ifie  Before joining Loughborough University, Dr. Ifie worked as a Lecturer in Marketing at the School of Management, Swansea University. Prior to embarking on postgraduate studies and an academic career, he worked with Citibank. His research interests are in services and sales management, and he has published in the Journal of Marketing Management, Service Industries Journal, Journal of Retail and Consumer Services and Journal of Services Marketing. Antonis  C.  Simintiras  is currently the Dean at the College of Business Administration, Gulf University for Science and Technology in Kuwait, and P-T Research Professor of Marketing at the School of Management—Swansea University, UK. Over the years he held visiting professorial appointments in France, Spain, Austria, Greece, Finland, the USA and China. His main research interests are in the areas of personal selling and sales management, consumer behaviour and cross-cultural research methodology. Part of his work has appeared in the Journal of International Business Studies, Journal of Business Research, European Journal of Marketing, Industrial Marketing Management, Psychology and Marketing, Journal of Managerial Psychology and Journal of Small Business Management. He has also co-authored a book Global Sales Management and a monograph Success and Failure of IS/IT Projects.

Chapter 1

Introduction

This chapter presents an organisation as a business entity containing various components and perspectives that continuously interact with one another and the environment. By nature, organisations are complex systems as they consist of individuals, teams and business units that interact with one another through feedback mechanisms. This implies holding a single view of the organisation is tantamount to having a myopic view of the firm. This will be detrimental to understanding the intricacies and important factors that help constitute and influence not only organisational performance but also its survival. In instances, where the key components/ factors are not considered or known to influence the survival of the organisation or the firm, the management risks the chance of being outperformed and become extinct particularly in a dynamic business environment. In this chapter, we explain the importance of organisational adaptations, we highlight the aims and objectives of the monograph, and an argument for a pluralistic perspective view of this important concept is put forward. Also explanation into the adopted methodological approach is discussed, and, lastly, the structure of the monograph chapters is explained.

1.1  Organisational Adaptations: A Pluralistic Perspective “Organisations are now routinely viewed as dynamic systems of adaptation and evolution that contain multiple parts which interact with one another and the environment”. (Morel & Ramanujam, 1999:278)

Dynamism is “change that is hard to predict and that heightens uncertainty for key organisational members” (Dess & Beard, 1984:56). Generally, it is held that proactive firms are most likely to outperform inert firms (Meeus & Oerlemans, 2000). In today’s business environment where business rivalry increases in complexity and change is fast and unpredictable, new paradigms, concepts and perspectives into evolving cases and scenarios in dynamic market are germane to investigate © The Author(s) 2018 O.E. Adegbite et al., Organisational Adaptations, SpringerBriefs in Business, DOI 10.1007/978-3-319-63510-1_1

1

2

1 Introduction

the continuously evolving proactive firms. This is because the traditional and/or individually existing paradigms are insufficient in explaining the observed changes in the business environment. Our intention is to develop a holistic way of understanding organisational adaptations. We aim to achieve this through investigation into relevant concepts and theories of adaptations. This is particularly appropriate considering that adaptation is viewed as a continuing organisational process that occurs through the integration and interactions of various theoretical perspectives. In this monograph, we construe organisational adaptations as multifaceted body of knowledge (diverse disciplines) ranging from business management, psychology, economics, information systems and others. This body of knowledge reflects different, interrelated and sometimes competing theories and explanations of causes and effects of events in organisations. Principally, it reflects organisation as an adaptive complex system that is influenced by both endogenous and exogenous complexities that reveal themselves through various actions and consequences occurring within the firm. These actions and consequences occur in diverse contexts and involve various wide-ranging interrelated organisational concepts. These concepts include and not limited to organisational culture, strategic decision-making process and organisational resources. All these interrelate in the process of (mal)adaptations in the organisation. For instance, the case of Barclays UK described below reveals the impact of marketplace dynamics on Barclays Bank including its competitors: “Barclays Banks sacks its Chief Executive … The Bank said a ‘new set of skills’ was required at the top… (BBC News, 8 July, 2015). The bank needed to become more efficient…what we need is profit improvement. Barclays is not efficient. We are cumbersome…. there is no question that cultural change was urgently required… …the board had decided the firm needed to change its strategy in order to boost revenue growth ….Barclays needs to be ‘leaner and more agile’ to improve the firm’s capital performance”. —Chairman John McFarlane ‘Investors welcomed the news of the change, sending Barclays shares up more than 2% in London…With the sacking of Barclays CEO, it means four of Europe’s biggest banks have changed their leaders this year. The rest are Deutsche Bank, Credit Suisse and Standard Chartered. This may be reflecting the immense regulatory pressure and strategic shifts confronting the industry’. (Financial Times, July 8, 2015)

Excerpts from: BBC News, July 8, 2015 and Financial Times, July 8, 2015 From the above scenario, we can deduce some key information: (1) Barclays need to improve on its profitability. (2) The company’s plan to achieve this (i.e. by adapting to its competitive business environment) was not working as initially set out. (3) To actualise Barclays’s objective “…a ‘new set of skills’ was required at the top…” (BBC News, July 8, 2015). The related concepts relevant to adaptation in the above excerpts are contingency theory, organisational culture, organisational competitiveness, organisational

1.1  Organisational Adaptations: A Pluralistic Perspective

3

resources, organisational structure, corporate strategy and organisational ­leadership. All these concepts interplayed that resulted in maladaptation of Barclay’s Bank. But the Bank seeks and hopes to improve its firm’s capital performance through ‘leaner and more agile’ operation. The above excerpts connote a sample of activities that are happening in contemporary global brands that are responsive to their business environments. The above-narrated events underscore the importance of organisational adaptations in businesses from a multi-concept perspective. Failure to attune to the demands of business environment may impact negatively on business bottom line (Grant & Cravens, 1996; Zoltners, Sinha, & Lorimer, 2008). For businesses to remain efficient and effective, adaptation may be inevitable irrespective of the industry or sector that a firm operates (Miller, 1982); although, the challenges may be more pronounce in some industries relative to others (Miles & Snow, 1978). Despite the challenges associated with achieving optimal organisational adaptation, the task of successful organisational adaptations is achievable (Canning & HanmerLoyd, 2001; Rant, 2007). The narration below captures the success story of firm (i.e. top manager(s)/management) that adapts its strategy to changes in its operating environment. “Ferguson has demonstrated a tremendous capacity to adapt as the game has changed”. — David Gill former Chief Executive Manchester United Club “Our analysis of a decade’s worth of players transfer data revealed Ferguson to be a uniquely effective ‘portfolio manager’ of talents. He is strategic, rational, and systematic”.—Anita Elberse “He’s [Ferguson] never really looking at this moment, he’s always looking into the future… Knowing what needs strengthening and what needs refreshing—he’s got that knack”.— Ryan Giggs former ex-player “Observation is critical to management. The ability to see things is key—or, more specifically, the ability to see things you don’t expect to see… Responding to change is never easy, and it is perhaps even harder when one is on top for so long…being positive and adventurous and taking risks—that was our style…Never stop adapting. One of the things I’ve done well over the years is to manage change. I believe that you control change by accepting it. Most people with my kind of track record don’t look to change. But I always felt I couldn’t afford not to change.—Alex Ferguson ex-manager Manchester United Club

Excerpts from Elberse and Ferguson (2013): ‘Ferguson’s Formula’, Harvard Business Review Magazine, October 2013 The above excerpts summarised the key to surviving and thriving in a dynamic business environment. The key is adaptation. It is either organisation survives or succumbs; adapting to dynamics of the business environment has to do with surviving and thriving of proactive firms. Adapting comes with its attendant prerequisites—ability to observe, rational, systematic and always forward thinking. These are some of the key capabilities that encapsulate the success story of the former

4

1 Introduction

manager of Manchester United Football Club—Sir Alex Ferguson. Like many highly performance-driven industry, the football industry is highly dynamic and constantly changing (Morrow & Howieson, 2014). There are enormous e­ xpectations from various stakeholders—the Club owners [investors], season ticket holders [fans] and other associated/affiliated business partners (Duncan, 1972). The operations, demands and expectations of various stakeholders from manager and his team of decision-makers represent a typical complex business environment in which many contemporary business organisations operate. The fact that the above-narrated adaptation process resulted in positive outcomes does not mean all adaptations produce desired outcomes. Some critical factors must be inherent in any organisations that desire successful adaptation(s) (Hrebiniak & Joyce, 1985; Miles & Snow, 1978). In order to effect result-oriented adaptation, decision-makers must proffer answers to the following result-provoking questions: 1. Is pluralistic perspective of any advantage to our understanding of organisational adaptations? 2. In what way does the perspective enhances our epistemology of this important concept? 3. What are the benefits of holding a pluralistic view? 4. What are the pitfalls to avoid in the process of adapting organisation resources to the dictates of adaptation triggers? All these and other relevant key organisational issues are discussed in the course of this monograph. This work is distinct in two major ways, namely, it is multidisciplinary in its approach. It is hoped that the suggestions emanating from this monograph will broaden our scholarly understanding of this concept. Practitioners may broaden their horizons on how to better handle their diverse dynamic business environments. Additionally, this work may steer up other research interests in the field of organisational adaptation.

1.2  Why a Pluralistic Perspective? Organisational adaptation permeates all levels of organisation and its industry— individual, strategic business units, organisation as an entity. Therefore, there is no single process or analytical pathway that results in an adaptive organisation (Carley, 2000). Also, organisations are constantly changing, but these changes cannot be explained in simple terms. There are two types of change in organisations—­ deliberate or chaotic. These are either forced on the organisation by the external environment or deliberate attempts to adapt the organisation. Because business environments are not static, firms must undergo adaptations, or they may be selected against, i.e. not survive the competitive environment (Aldrich & Auster, 1986). Successfully effecting adaptation can be a significant determinant of shortand long-term firm’s successes (Appelbaum, Habashy, Malo, & Shafiq, 2012). We

1.2  Why a Pluralistic Perspective?

5

argue that effective adaptation can only be achieved through a pluralistic approach to management. Furthermore, there is widespread agreement in management literature that most business decision-making occur under conditions of uncertainty. Some of the uncertain situations are shifts in consumers’ demands and preferences that affect the ­systemic risk in the economy (Brealey & Myers, 1988), unforeseeable events in a firm’s environment (Schumpeter, 1934), poor insight of cause-and-effect relationships in a firm’s business activities (Lippman & Rumelt, 1982) and information-­ processing constraints of human beings (Simon, 1947). All these scenarios make it impossible for the outcomes of many business decisions to be predicted with certainty at the time they are made (Alchian, 1950; Cyert & March, 1963). In effect, what is certain is that organisational outcomes are significantly influenced by the context in which they occur (Pettigrew, 1990). If this is true, then it is construed that holistic perspective of organisational dynamics offers a better platform to understand how organisations adapt. Since adaptation is essentially both a complex adaptive system and process phenomenon, it should best be studied holistically in context and through processual analysis this we argue. In a similar vein, Markovsky (1992) argued that very simple models of social interaction across networks were complex that researchers were unable to predict their behaviour. This suggests that in a complex process like organisational adaptation, logically there are various interacting actors (e.g. individuals, teams, organisations or procedures in the firm or industry) and it is rarely possible to have a robust insight into the dynamics of the complex process without holding a pluralistic view. The pursuit of optimal organisational model may be complicated by unpredictability in business environment (Carley, 2000). Justifications for firms’ transformations are inevitably holistic and multifaceted in nature. We should therefore be cautious of the myth of the singular theory of social or organisational change (Pettigrew, 1990). The motivation for this work was borne out of the fact that empirical findings that relate firm-based processes to organisational adaptations are still at infant stage (Verona & Ravasi, 2003). Previous research findings indicate that failed organisational change efforts varies from one-third to as high as 80 % of tried change initiatives (e.g. Appelbaum et al., 2012; Fisher, 1994; Kotter, 2008). Perhaps, the reason for this might be that organisations may have been narrow minded in their effort to adapt. Another probable reason is that organisations might not have a full grasp of intricacies occurring in adaptations within organisations. Closely related to this is when firms attempted to effect change when adaptation is the most appropriate effort required in such context. A sound delineation of change from adaptation may provide an excellent guide in this respect. The differences and similarities in organisational change and adaptation are discussed in the next section. In today’s business environment where business rivalry increases in complexity and overlapping dynamic organisational issues, a holistic approach to unfolding organisational activities may be most suitable. Other probable reason is the fact that the resultant outcome of adaptation efforts (actual adaptation) might be different from the desired adjustment (ideal adaptation). We suggest that remarkable improve-

6

1 Introduction

ment in the rate of successful implementation of change initiatives is achievable if organisations can adopt pluralistic approach in their adaptation processes. This view is premised on the multidimensional nature of organisational adaptations and its complex features (Holland, 1992). Adaptations in organisations are some of the key areas that strategic management practice aims to address and generally, ‘the ­problems addressed in the practice of strategic management require insights from multiple disciplines’ (Augier & Teece, 2008:1189). It is therefore not out of place to adopt pluralistic perspective approach in organisational adaptations research. Furthermore, attempts to understand organisational phenomenon through plurality of perspectives are not new in management and management-related studies (e.g. Morrison & Milliken, 2000; Simintiras & Cadogan, 1996; Spender, 1998).This approach preserves the authenticity of distinct theories and at the same time, advances theory building, because it highlights circumstances where interplays among the theories may provide stronger and broader explanatory power of organisational change and development processes (see: Poole & Van de Ven, 1989; Van de Ven & Poole, 1988). Considering the foregoing, there is a need to undertake a pluralistic approach in pursuit of multiple intersecting conditions which connect features of context and process to certain organisational outcomes (Ragin, 1987). With pluralistic approach, our understanding of adaptation in organisations will be enriched. It is construe that enhanced knowledge about firm capacity to respond to business uncertainties will lead to improve chances of firm survival and superior performance.

1.3  Differences Between Change and Adaptation The words change and adaptation are often used interchangeably in many organisational studies (e.g. Armenakis & Bedeian, 1999; Carley & Lee, 1998; Pettigrew, 1987; Weick & Quinn, 1999). We construe change as any difference between an organisation at one time and the next. These changes may or may not represent learning; however, learning to learn is critical in adaptation processes (Carley & Lee, 1998). Furthermore, organisational adaptations are those changes that enable the organisation to maintain or improve its performance—survival, profit growth and/or sales volume. In such context, adaptation is often referred to as successful change (e.g. see Carley & Lee, 1998). Since different firm strategies are better suitable in different circumstances, adaptation can be thought of as the successful result of a process of searching for the optimal, or at least a better, strategy for the environment confronting the organisation given that the organisation itself is altering its behaviour as the individuals within the organisation garner experience. Adaptive organisations then are those that end up situated on the higher peaks. Concerns for continuously generating value for the firm, its customers, employees and other stakeholders are at the heart of organisational adaptation. This implies that value creation, capturing and appropriation to all stakeholders are key to organisational adaptations; this cannot be said for every effort to effect organisational

1.4  Aim and Objectives

7

change. In essence, organisational adaptations are usually effected to prevent negative effect of organisational loss of both social and economic value. Change, or exploration, by the organisation is seen as a force enabling, but not guaranteeing, adaptation. This implies that change in strategy and/or operation enables the organisation to walk around a performance surface and move towards a peak. While it is argued that the two words are similar and often used interchangeably, caution should be exercised that the concept of change is not expressed when and where the appropriate narrative is adaptation.

1.4  Aim and Objectives The principal purpose of this monograph is to stimulate scholarly thinking that organisational adaptations should be viewed from multilevel perspectives so as to broaden our understanding of this important concept. We aim to provide a platform that promotes comprehensive understanding of how firms cope with influences in their dynamic business environments. These influences are increasingly growing in complexity and fluidity; a pluralistic, comprehensive and yet flexible perspectives of organisational occurrences are suggested. By combining diverse perspectives and looking at the concept of organisational adaptation from different theories and disciplines, we suggest that it should be possible for organisation to develop a holistic, pragmatic and useful means of understanding organisation interconnectedness. A single theoretical perspective invariably offers only a partial account of a complex phenomenon (Spender, 1998). Moreover, the juxtaposition of different theoretical perspectives brings into focus contrasting worldviews of social change and development. Working out the relationships between such seemingly divergent views provides opportunities to develop new theory that has stronger and broader explanatory power than the initial perspectives. Some integration is thus desirable, but it must preserve the distinctiveness of alternative theories of organisational change and development (Van de Ven & Poole, 1988). We contend that such integration is possible if different perspectives are viewed as providing alternative pictures of the same organisational processes without nullifying each other. This can be achieved by identifying the viewpoints from which each theory applies and the contexts when these theories are interrelated. The conceptual leap to be taken from this work is an insight into viewing organisational adaptations from a broad base. This is borne from our understanding that organisation is a complex adaptive systems and that as in any study on complex systems, [organisations inclusive], it is important to undertake an integrative study of the parts (perspectives) with a view of understanding the ‘whole’. However, in comprehending the whole (i.e. complex systems), another question arises, that is, how can we understand the ‘whole’ ‘whose properties are not fully explained by an understanding of its parts?’ (Lewin, 1999: x); this is not because we are not interested in understanding its parts but because ‘complex systems contain many rela-

8

1 Introduction

tively independent parts which are highly interconnected and interactive’ (Cowan, 1994: 1, 2). Besides ‘complexity builds on, and enriches systems theory by ­articulating additional characteristics of complex systems and by emphasising their inter-­relationship and inter-dependence’ (Mitleton-Kelly, 2003:25). From the foregoing, we can adduce that one of the ways to understand the organisation is to gain insights into the dynamics that emerge from the interaction among the parts of the complex adaptive system itself. We therefore argue that one major way this can be done is through a detailed exploration of the subject matter from a pluralistic perspective. Besides due to the characteristic nature of its environment, organisations operating in constantly changing environments face ‘moving target’ as it were. A multidimensional approach will therefore be appropriate in the quest to gain insights into the dynamics that surrounds this phenomenon. Understanding organisational adaptations within organisation and among organisations particularly in a network of economic activities is one significant route of research in the field of complexity discipline (Lewin & Regine, 1999). We accept that unravelling complex system poses a daunting task even as it is difficult to manage a high-levelled complex system that may result in dismal performance. But the clue to understanding complex systems, we suggest lies in understanding the individual components, particularly the critical elements that glue different parts of the complex system as a huge unit together; this is what this monograph articulates. It is envisaged that insight from this monograph will be useful in the field of marketing including sales management, international business, strategic management, supply chain management and e-business and in other related firms operating in dynamic business environments across various industries and sectors. A vital means of gaining insight into adaptation is through a processual analysis research. Such research effort leverages on case study synthesised with content context and process framework.

1.5  C  ontent, Context and Process (CCP) Framework, Processual and Case Study Analysis A synthesis of content, context and process (CCP) model, processual analysis and case study research methodology was adopted in this study. A synchronisation of this three-in-one method offers a robust means of providing a better platform to comprehending adaptations in organisations. It has been argued that theoretically sound and practically useful research on organisational adaptations should inquire the contexts, content and process of transformation together with their interconnections through time (Pettigrew, 1990). Also, organisational adaptations are processual in nature and hence necessitate processual research method. Process research is a skilful activity full of intuition, judgement and tacit knowledge. There is no known single way of undertaking processual investigation, but taking cognisance of temporalities of events is important in process research (Pettigrew, 1997). Ibid, the time quality of a processual research is evident in relating processes to outcomes. As a guide to conducting well-grounded research

1.6  Structure of Monograph

9

on organisational adaptations, we define and delineate process and process analysis distinctively. Process is described as a series of individual and communal events, actions and activities emerging over time in context (Pettigrew, 1997; Van de Ven, 1992). Processual analysis aims to dissect and describes mammoth of distinctions and complexities beneath organisational process [in this context organisational adaptation]. The overriding purpose of the process researcher is to catch this reality in flight (Pettigrew, 1997) while bearing in mind the ‘moving target’ nature of organisational adaptation. Case studies are vital in giving answers to ‘How?’ and ‘Why?’ research questions, and in this respect, it is appropriate for descriptive, exploratory or explanatory research (Rowley, 2002). This research method is applicable in research into contemporary events such as adaptations in organisations in which the relevant behaviour(s) cannot be schemed.

1.6  Structure of Monograph The monograph is divided into seven chapters. Chapter 1 explains and gives overall insight into the concept of organisational adaptations. It provides reasons for probing diverse perspectives and also explains both the criteria and the methodology employed for the study. Chapter 2 discusses firm business environment and how it impacts organisational adaptation. In Chap. 3, relevant perspectives, theories and various pertinent concepts that help further our understanding of adaptations in organisations are discussed. Chapter 4 centres on adaptive behaviour paradigms. Nine (9) distinct adaptive behaviour paradigms (ABPs) are proposed based on reviewed literature. These paradigms are germane in the process of organisational adaptations; Chapter 5 offers a detailed description of dynamic capabilities and their importance in achieving desired adaptations in organisations. In Chap. 6, various forms and types of organisational adaptations are examined; issues pertaining to research methodology—content, context and process framework in organisational adaptations—are discussed; and lastly, this chapter presents an in-depth case study analysis of digitalisation of photographic industry (Kodak and Fujifilm). Chapter 7 presents further insights into Kodak/Fujifilm adaptations during the period of technology discontinuity. The chapter also examines the other side of organisational adaptations. This covers the criticisms, challenges and perceived shortcomings of organisational adaptation. Concluding highlights, limitation of study and suggestions for further research and closing remarks to the monograph are also discussed.

Chapter 2

The Organisation Business Environment

Business does not operate in vacuum. It operates in the ambit of environment. Organisation environment has been described as the aggregate of tangible and intangible factors that impact on the decision-making behaviours of individuals in the organisations (Duncan, 1972; Fahey & Narayanan, 1986; Frishammar, 2006; Rosenzweig & Singh, 1991). “These [organisations] systems change and reorganize their component parts to adapt themselves to the problems posed by their surroundings. This is the main reason the systems are difficult to understand and control. They constitute a ‘moving target’ ”. [Holland, 1992:18, emphasis added]

Holland’s assertion suggests that a firm’s business environment is a ‘landmine’ of triggers of firm adaptations. Customers, competitors, firm’s employees and other material resources, distributors, suppliers, shareholders and other stakeholders are common examples of a typical firm’s environment. In this chapter, the multidimensionality and multilevel nature of business environments are examined. This nature of business environments is one of the key reasons why it is difficult to achieve adaptation. Paradoxically, this chapter also highlights business environments as the triggers of organisational adaptations. These triggers must be understood and captured in context before firm can create and appropriate values for themselves and their stakeholders. The chapter also emphasises the need for organisations to take cognisance of dynamic and complex features that permeate in all environmental levels, and this has implications on their businesses.

2.1  The Dimensions of Business Environment Some management scholars have described organisation environments as placid or turbulent (Emery & Trist, 1965), stable/uncertain (Lawrence & Lorsch, 1967) and simple-complex or static-dynamic (Duncan, 1972). Equally, business environments © The Author(s) 2018 O.E. Adegbite et al., Organisational Adaptations, SpringerBriefs in Business, DOI 10.1007/978-3-319-63510-1_2

11

12

2  The Organisation Business Environment

have been discussed under various conceptualisations with a view to describe specific sectors of organisational environments. This includes the task environment (Dill, 1958), domain (Levine & White, 1961), sub-environment (Lawrence & Lorsch, 1967), territory (Child, 1972) and industry (Porter, 1980). Generally, a typical business environment is characterised of uncertainty, complexity and munificence (Aragón-Correa & Sharma, 2003; Dess & Beard, 1984). These are examined in detail below.

2.2  Environmental Uncertainty Scholars in management studies view uncertainty sometimes as “decision situations where there is an unknowable future and sometimes to situations where this future is knowable, but not calculable” (Liesch, Welch, & Buckley, 2011a, 2011b:854). It can also be described as ‘an individual’s perceived inability to predict business environment accurately’ because of ‘[in] sufficient information or the failure to discriminate between germane data and irrelevant data’ (Milliken, 1987:136, emphasis added). Central to the theory of transaction cost economics (TCE) is uncertainty (Williamson, 1985). It is often triggered by ambiguous situations and sketchiness which accentuates the bounded rationality (limited by the available information, constraints of cognitive minds and the time frame to make the decision) of humans to gather and explore all possible eventualities to a decision (Liesch et al., 2011a, 2011b). Furthermore, there are uncertainties influencing decisions that inhibit knowing; such that the decision eventualities are absolutely imperceptible. It is also referred to as environmental dynamism which typifies unpredictability of environmental change (Bendapudi & Berry, 1997). In such unpredictable instances, drawing inferences from general context to a particular situation is problematic in that “the past does not provide a guide to the course of future events, (and where) agents are truly uncertain as there currently does not exist information that will help them discover the future. Decision have to be made and choice is genuine” (Dunn, 2000:427). This description of uncertainty explains in part the nature of contemporary business environment. It also affirms decadal assertion about uncertainty (Knight, 1921; Slater & Spencer, 2000) and faults the postulation of deterministic nature of uncertainty (Williamson, 1985). Three types of business environmental uncertainties are identified (Aragón-Correa & Sharma, 2003). They are: 1. Environmental state uncertainty occurs when managers identify trends in their environments or some of the components (of their environments) to be unpredictable (Aragón-Correa & Sharma, 2003; Milliken, 1987, 1990). It is about dearth of understanding about ways in which elements of the environment might be changing (Ashill & Jobber, 2010).

2.2  Environmental Uncertainty

13

2. Organisational effect uncertainty happens when managers experience difficulties in comprehending or predicting the influence of changes in their organisations’ general business environment (Aragón-Correa & Sharma, 2003). 3. Decision response uncertainty happens when managers perceive risk in foreseeing the outcomes of idiosyncratic decisions (Aragón-Correa & Sharma, 2003; Milliken, 1987). The inherent attribute of these uncertainty typologies is different, and failure to recognise them has resulted in many conflicting research findings (Ashill & Jobber, 2010; Doty, Bhattacharya, Wheatley, & Sutcliffe, 2006). Researchers in business environmental studies argued that managers experiencing uncertain business environments are likely to be more proactive and adopt more innovative approaches than their peers in less turbulent environments (Miles & Snow, 1978; Milliken, 1987). This is so because they tend to anticipate happenings and devise precautionary actions rather than reacting to incidents that have already happened (Aragón-Correa & Sharma, 2003). In essence, such managers operate in proactive organisations in which decision-making is more probably decentralised at the interface between business and the task environment. The decentralisation of decision-making permits line managers to use their discretions in predicting future strategic trends (Sharma, 2000) and avail them the opportunity to develop their capabilities (Aragón-Correa & Sharma, 2003). Proactive firms are ‘prospectors’ in their characteristics and objectives (Miles & Snow, 1978); they invest more into the development of novel products and models with marginal negative effects on the task environment (Aragón-Correa, 1998; Buchko, 1994); managers in proactive organisations exhibit discretion and take risks (Sharma, 2000). It is argued that uncertainty and risk coevolve with one another but should not be construed to be the same (Liesch et al., 2011a, 2011b). Both are unique constructs with distinct effects, individually and jointly on managerial decision-making process (Alessandri et al., 2004). Unlike uncertainty, risk relates to decisions where the outcomes of actions are contingent on identified probability distributions (Liesch et al., 2011a, 2011b). In the international business literature, the implications of uncertainty and risks to multinational firms in international business environments have been identified (Austrade, 2002; Buckley & Carter, 2004). For example, the importance of uncertainty and risk in decision-making at various levels of international activities has been suggested, particularly as multinational firms involve in new activities such as entering new markets, employing various modes of operations or changing international strategies (Liesch et  al., 2011a, 2011b). Uncertainty lessens the ability of firms to create value by constraining the scale and effectiveness of the activities they undertake (Buckley & Carter, 2004). In determining modes of foreign operations firms might opt for low commitment (e.g. franchising/licensing) compare to high commitment (e.g. foreign direct investment); this implies that risk and uncertainty influence the nature and content of action taken by firms (Liesch et al., 2011a, 2011b). In order to minimise uncertainty and risk, firms embark on market ­spreading plan, wide-ranging market research and solicit government support (Cyert & March, 1963).

14

2  The Organisation Business Environment

2.3  Environmental Complexity This is one key component of general business environment (Aragón-Correa & Sharma, 2003). Complexity in business environment is characterised by multiple and diverse elements and situations in such environment (Buchko, 1994; Milliken, 1987). In today’s business environment, complexity is the most common and prevalent challenge confronting organisations. The task of managing complexity should be viewed as a core competency issue for managers (Maznevski, Steger, & Amann, 2007). While there is agreement in management literature on the existence of environmental complexity, differences occur in classifications of this conundrum. Management scholars used different criteria to classify organisational complexity. This ranges from within and outside organisation-based classification, source-based classification, influence-on-firm performance-based classification, firm-individual-­ based classification and internal and external complexity. Irrespective of the basis of classification, it is adduced that complexity originates from human activities (Aragón-Correa & Sharma, 2003; Birkinshaw & Heywood, 2010; Vasconcelos & Ramirez, 2011). Also in the face of external complexity, organisations often respond by spiralling up their internal complexity, through organisational structure, function, operation and/or circumstance (Vasconcelos & Ramirez, 2011). Hence, people are both the source and victims of business complexity and solution lays in managing (humans) behavioural causes of complexity (Collinson & Jay, 2012). In their study involving a survey of over 500 managers in Europe, involving over 300 companies comprising of 10,000 employees, among them, Collinson and Jay (2012) reported that nearly 66 % of managers reported over 5% of productivity loss in their businesses was due to complexity, and 10% of managers estimated that as high as 30 % of recorded productivity loss was due to complexity in business environment. It has been argued that those organisations that can effectively manage the complexity enigma are likely to develop competitive advantages (Aragón-Correa & Sharma, 2003; Collinson & Jay, 2012). As enumerated above, various types of complexities have been identified in organisational studies. These are typically based on their origin/perceived influence on firm performance (Birkinshaw & Heywood, 2010;Collinson & Jay, 2012 ; Vasconcelos & Ramirez, 2011). Some of the identified complexities are: 1. Diversity; 2. Interdependence; 3. Ambiguity and; 4. Flux complexities (Maznevski et al., 2007). Furthermore, some certain firm characteristics have been identified to contribute to complexity. These include firm size, usually, the larger an organisation, the more complex it becomes. Also, firm factors of interests are levels of hierarchy within the firm, structural divisions/organisational structures, control mechanisms, territorial diversity in which firm operates, rate of change of firm/individual behaviour, procedures, intra- and inter-business unit relationships and adopted communication modes (Collinson & Jay, 2012; Vasconcelos & Ramirez, 2011).

2.3  Environmental Complexity

15

For clarity and simplicity in this study, we adopt Maznevski et al.’s (2007) classification of environmental complexity. Similarly diversity, interdependence, ambiguity and flux permeate, and other suggested classifications of complexity. For example, diversity refers to complex challenges both within (endogenous) and outside (exogenous) the organisation. Endogenous complexity relates to diverse business models for different strategic business units, diversity in the human resources pool, variations in the means and ends spanning from simple financial objectives to a broad (including non-profit) corporate responsibilities. Exogenous organisational diversity relates to mammoth of stakeholders with various interests and influence on the organisation (this includes customers, shareholders, regulators, trade associations, suppliers, distributors, etc.), diverse customers’ needs and different cultural values. Others include varied influence from economic, political and legal environments and various counter strategic alternatives from the competitors. It is no understatement that today most large organisations increasingly face various types of complex diversity. Managing the plethora of diversity is not a small task. Equally, attempts to reduce diversity usually result in less responsiveness (Maznevski et al., 2007). Global interdependence of firms is a resultant effect of globalisation. In today’s business environment, value webs (i.e. business transactions through the internet links among firms) are fast-replacing conventional value chains (Liesch et  al., 2011a, 2011b; Maznevski et al., 2007). Increase in product complexity and increase in sales figure can result in increased interdependence of firms. This was the case of automobile giant Toyota. Between 2002 and 2008, Toyota’s manufacturing facilities outside Japan increased markedly from 37 to 53, with annual average global sales of 9% (Cole, 2011). Toyota car crisis of 2009/2010 was partly traced to significant hiring of new employees, partnering with non-Japanese suppliers who are unfamiliar with the culture of Toyota’s quality and massive hiring of contracts engineers in Toyota’s various car plants across the world (Cole, 2011). Toyota’s complexity inherent in its interdependence of firms impacted negatively on the firm’s reputation/brand, financials (profitability) and reverse trends (i.e. recall of products and cancellations of ordered goods). As globalisation comes with huge business/market opportunities, it has associated challenges in business complexity (Liesch et  al., 2011a, 2011b). Ambiguity refers to enormous information in contemporary business environment with reduced clarity on means of interpreting and applying it to firm’s advantage(s) (Maznevski et  al., 2007). Market dynamisms, surveys/reports and other relevant market findings are becoming less reliable because of increasing market uncertainties. Amidst the growing market uncertainties, many firms are struggling to grasp their value drivers devoid of market ambiguities. According to Maznevski et al. (2007), to many firms, the clarity between cause-­ and-­effect relationships is distorted by complex ambiguity. Associated difficulty with ambiguity is the possibility of multiple interpretations of the same set of information, based on the organisational knowledge, perspective or cultural inclinations (Collinson & Jay, 2012).

16

2  The Organisation Business Environment

Flux or change refers to changeability element in the business environment to the extent that today’s valid response to present challenge may be ineffective to tomorrow’s problem. The problem of flux reinforces the call on firms to develop (1) dynamic capabilities and (2) organisational framework that is capable of adapting firm resources to any market situation at any point in time (Grant, 1996; Zajac, Kraatz, & Bresser, 2000). Firms need a model that is capable of adapting to any market situation. It is about conceptualising strategy as a framework of practices and principles that constitutes the firm’s DNA rather than a bureaucratic set-up. It is recognised that some organisational core principles should be nonnegotiable. Generally, it is widely shared and accepted that organisations that are characterised by light rules and that operates using a developed learning model are able to adapt quickly than their peers. In such organisations, competitiveness is embedded in its swift of adaptability and scalable learning models (Maznevski et  al., 2007; Vasconcelos & Ramirez, 2011). Apart from being a critical component of business environment, the concept of complexity has significant but relevant connotations in other discipline outside management. This connotation is well commented in science-based disciplines like biology, computer science and information systems. There exist similarities between management discipline, and these identified disciplines because they both address complex systems. Besides, contemporary business reality reveals that there is growing interdisciplinary research of important concept that cross across various disciplines of which the research in complex systems belong. More importantly, organisations can be viewed as complex adaptive systems (CAS) as it is obtainable in other disciplines. With this in mind, we consider the definition of complexity from another discipline. Santa Fe Institute defines complexity as ‘systems with many different parts which, by rather mysterious process of self-organisation, become more ordered and more informed than systems which operate in approximate thermodynamic equilibrium with their surroundings’ (Cited in Peltoniemi & Vuori, 2004:9). Organisations operating in closed systems are viewed as transacting in a simple environment (Dess & Beard, 1984; Duncan, 1972). And this is similar to Santa Fe Institute description of ‘systems which operate in approximate thermodynamic equilibrium with their surroundings’ (Cited in Peltoniemi & Vuori, 2004:9). Conversely, organisations operating in open system face heterogeneity in their surroundings, they are most likely to face more complex environment with greater uncertainty with greater data/information processing demands than those operating in the close system (Dess & Beard, 1984; Pennings, 1975). The degree of openness of a system is relatively a replica of its combinatorial power and so is its degree of complexity (Boisot & Child, 1999).

2.4  Environmental Munificence Munificence (or resource availability) is a critical component of business environment (Aragón-Correa & Sharma, 2003; Staw & Szwajkowski, 1975). It refers to the scarcity or plenteous of key resources needed by (one or many) organisations

2.4  Environmental Munificence

17

operating within an environment (Dess & Beard, 1984; Tushman & Anderson, 1986). The survival and growth of organisations within an environment is influenced by the resources available for sharing in that environment; the available resources also affect the abilities of new firms to join this environment (Castrogiovanni, 1991; Randolph & Dess, 1984). Environmental munificence manifests in the form of (but not limited to) fast-­ growing markets, government interventions, [in] sufficient infrastructure, lower levies (taxes), competent workforce and national/global economic upturn (Decarolis & Deeds, 1999; Primc & Čater, 2015). Empirical findings in business environment literature reveal that competition intensifies during period of scarcity of resources (Dess & Beard, 1984; Porter, 1980; Yasai-Ardekani, 1989), with negative implications on profitability and organisational slack (Beard & Dess, 1981; Castrogiovanni, 1991; Child, 1972; Singh, Tucker, & House, 1986) and triggering adjustments in intra-firm attributes and behaviours of members within the organisation (Castrogiovanni, 1991; Koberg, 1987). Also, firms confronted with common resource scarcity may circumvent competition through legal or illegal modes of collaboration and cooperation (Pfeffer & Salancik, 1978; Staw & Szwajkowski, 1975). Whereas in situations where there are ample resources, firms survive with ease and are able to pursue other goals (Castrogiovanni, 1991). Environmental munificence is positively related to variety of strategies and choices available to the firm (Brittain & Freeman, 1980; Tushman & Anderson, 1986). Empirical results support the view that firms operating with high munificent environments have optimal strategic choices, experience harmonious organisational constituencies and less competitive pressures (Castrogiovanni, 1991). According to Castrogiovanni (1991), problems of over-abstraction and conceptual ambiguity have been observed in environmental munificence-related studies. These problems arise from the researchers’ options of the environmental munificence level(s) and dimensions to investigate. Over-abstraction problem occurs when only markedly broad but less specific levels are examined, while conceptual ambiguity relates to inconsistencies in dimensions and definitions across studies in environmental munificence. To overcome over-abstraction and conceptual ambiguity problems in business environment research, Castrogiovanni (1991) suggested five environmental levels and three kinds of munificence to ameliorate these problems. This is particularly instructive because environments are both multilevel and multidimensional (cf. Betton & Dess, 1985). Also, some environmental variables are more appropriate to a particular firm and to the specific situations at hand than others (cf. Osborn & Hunt, 1974). Both the five environmental levels and three kinds of munificence are explained in the following sections.

2.4.1  Environmental Munificence Levels The five levels of environmental munificence are the macro environment, the aggregate environment, the task environment, the sub-environment and the resource pool environment. The macro environment relates to general cultural context of a given

18

2  The Organisation Business Environment

geographic area. It encompasses variables identified to have critical influences on organisational features and productiveness (Castrogiovanni, 1991). These variables include economic, technological, demographic, social and political patterns and trends (Osborn & Hunt, 1974). Relevant works in this area include influence of long-term economic, social and political trends on the organisational forms that are most dominant at various times in US history (Aldrich & Mueller, 1982). The aggregate environment relates to relevant associations (such as trade associations, trade unions), interest groups (such as relevant NGOs and other stakeholders), constituencies (customer markets, competitors) and other categories of individual and organisations that affect a focal bundle of firms (Osborn & Hunt, 1974). At this level, environmental definitions are slightly varied, for example, organisational ecologist views this level as macro niche (McKinley, 1984; Ulrich, 1987) or ecological community (Astley, 1985; Carroll, 1984) in which a population of firms operates. Prominent among economists is Porter’s (1980) work of external forces influencing industry competition and profitability, where an industry represents a logical grouping of firms. Areas of research in this level include the aggregate behaviour of actual, perceived, or a focal set of firms (Castrogiovanni, 1991). Generally, aggregate environment is viewed as the summation of all task environments under which the set of firms under review is investigated. According to Osborn and Hunt (1974), the task environment of any given firm consists of all organisations with which it must relate with for survival and growth. These include specific customers, investors, suppliers and other relevant partners (Castrogiovanni, 1991). At this environmental level, research areas focus on actions, decisions, outcomes and features of the entire organisations with a view of explaining differences and similarities between individual organisations. For example, organisational decision-making is more decentralised in dynamic compared to static task environments (cf. Burns & Stalker, 1961). Of all the five levels of environmental munificence, task environment has been subjected to range of interpretations and usage (Castrogiovanni, 1991). Dill (1962) argued that individuals and subunits within a firm have different task environments in a firm that faces multi-task environments. This implies that Dill (1962) most probably considered task environment to be the same as sub-environments. Also, the task environment Dess and Beard (1984) referred to tallies with Castrogiovanni’s (1991) definition of aggregate environment. In any event, at the task environment level, several sub-environments of a firm are viewed together (Castrogiovanni, 1991). The sub-environment level concerns activities among set of individuals and organisations that control resource pools which are most suitable to a firm subunit. Actions and decisions taken by subunits’ managers are of most relevance under sub-­ environment. According to Lawrence and Lorsch (1967), each organisational subunit concentrates on a different area of an organisation’s entire external environment. For example, a techno-economic sub-environment is appropriate to the production/ manufacturing subunit; a market sub-environment is relevant to sales/marketing sub unit; and a scientific sub-environment is relevant to the research and development subunit (Castrogiovanni, 1991; Lawrence & Lorsch, 1967).

2.4  Environmental Munificence

19

The resource pool level, though the lowest of the five levels, is considered the most specific level of the environmental munificent typology (Castrogiovanni, 1991). Research bordering on resource dependence is of most relevant at this environmental level. For example, the criticality of several resources to particular organisation and how challenging it was to obtain such resources is particularly vital while evaluating how patterns of merger and diversification mirror interchanges of critical organisational resources (Pfeffer, 1972; Pfeffer & Salancik, 1978). Generaly, it can be adduced that dynamism and activities permeates all environmental levels (Meeus & Oerlemans, 2000). Castrogiovanni (1991) argued that usually, there is an environmental level that is most relevant to a particular research inquiry. For example, attention on specific decisions and actions about a particular resource acquisition requires analysis of specific resource pools. Investigation into differences and similarities across organisational subunits necessitates inquiry of their applicable sub-environments. An insight into the differences and similarities across organisational subunits is best explored by research in the task environment; the general behaviour of a logical group of organisations may be most explicable by exploring the aggregate environment. The overall inquiry into organisational trends and patterns within geographical location requires examination of the macro environmental situations of that area. Considering the foregoing, it is reasonable to say that scholars should investigate environment at the level that is most relevant to a specific research inquiry (cf. Castrogiovanni, 1991; Ford & Slocum, 1977). However, it is useful to investigate boundary environmental levels to ensure a comprehensive research outcome. This explains the call for multilevel environmental inquiries in empirical researches (cf. Betton & Dess, 1985). For example, while research inquiry into a task environment reveals the differences in decentralisation of decisions among organisations, to understand the whys and what decisions that are decentralised, analyses of sub-environment and resource pool environments are required (Castrogiovanni, 1991). Furthermore, research analysis at the task environment level may offer insight into the situations in which certain organisations are most probably to defunct; probing of macro environment may provide the causal issues influencing the aggregation of environments thereby revealing inherent rates of defunct (Castrogiovanni, 1991; Harrigan, 1985). Additionally, environmental factors at higher levels such as macro and aggregate environments can exert transitive impacts on organisations through their influences on lower levels (i.e. task environment; sub-environment and resource pool). For example, decisions regarding employee recruitment and selection and training are determined by the range of available manpower resource pool which in itself is influenced by educational and demographics configurations at the macro environmental level. Each higher level of environmental munificence is not just a combination of the levels; it is also characterised by synergies among the various environmental variables acting in unison. Besides the transitive influences, higher environmental levels can have immediate synergic influences on organisations (Castrogiovanni, 1991).

20

2  The Organisation Business Environment

2.4.2  Environmental Munificence Types Further to the five level environmental idiosyncrasies discussed above, three kinds of munificence are identified in the management literature. They are: 1. Environmental capacity refers to the level of resource abundance within an environmental context (Aldrich, 1979; Castrogiovanni, 1991). 2. Growth/decline relates to the relative change in environmental capacity (Zammuto & Cameron, 1985). 3. Opportunity/threat refers to the degree to which environmental capacity is un-­ utilised (Astley, 1985). It has been argued that if scholars in business environment can painstakingly identify munificence type that is relevant to their works, the problem of conceptual ambiguity will be markedly reduced (Castrogiovanni, 1991). Ibid, at each environmental level, these three kinds of munificence are evident. It is suggested that researchers need to clarify the kind(s) of munificence they are studying, and the measures employed must be compatible not only with the kind of munificence but also with the environmental level under inquiry. Effort short of this can lead to inconsistent research findings with narrow measurement validity. Additionally, researchers can analyse the environmental capacity, growth/decline and opportunity/threat at multilevel environments, with more focus on to the sub-­ environment and resource pool levels as much as possible. This is because environmental munificence analysis at the sub-environment and resource pool levels could further understanding of how organisations acquire competitive advantage through exchange and cross-utilisation of resources. Such effort will enhance testing of more context-specific propositions, resulting in richer researcher findings and, finally, more beneficial managerial recommendations. Further to the discussion of business environment, four different perspectives are identified. They are the adaptive, the cognitive, the population-ecology and the resource dependence perspectives (Frishammar, 2006). 2.4.2.1  The Adaptive Perspective The adaptive perspective centres on investigating how the environment affects organisations; the term ‘adaptive’ captures its underlying assumptions (Frishammar, 2006; Hannan & Freeman, 1977); specifically, the term ‘adaptive perspective’ was borrowed from the work of Hannan and Freeman (1977); the main assumptions in this perspective are that organisations are construed as active and can adapt to changes in their environments by making decisions to modify strategies, structures, and processes and then executing these decisions (Frishammar, 2006; Scott, 1998). Successful managers are either able to guard their organisations against

2.4  Environmental Munificence

21

environmental influences or to design seamless adjustments with minimal disruption (Chakravarthy, 1982; Frishammar, 2006). This perspective is shared by many management scholars (Ansoff, 1988; Chakravarthy, 1982; Fahey & Narayanan, 1986; Hofer & Schendel, 1978; Kotler & Armstrong, 1996; Miles & Snow, 1978; Utterback & Abernathy, 1975). Much of the widely accepted hypotheses in contingency theory fall under adaptive perspective (Galbraith, 1973; Hannan & Freeman, 1977; Lawrence & Lorsch, 1967); the underlying assumption guiding contingency theory is that organisations with internal characteristics that best fit the dictates of their environments will adapt optimally (Frishammar, 2006; Scott, 1998). This perspective is evident in the field of marketing, where organisations can realise their set goals and record efficiency through adapting to the demands and dictates of target markets (Kotler & Armstrong, 1996; Piercy, Cravens, & Morgan, 1997). Adaptive perspective not only assumes that environment is analysable but that it can be identified a priori and serves as an input in a strategy-construction process (Frishammar, 2006). Organisations do not create or invent their environments, but their environments may depict a fundamental order rather than a forced one (Fahey & Narayanan, 1986). This implies that through market research or environmental-scanning methods, firms can investigate and identify its characteristics with the intention of achieving successful adaptation (Frishammar, 2006). Identified key element of an organisation’s environment is the industry or industries in which it competes; this includes buyers, substitutes, suppliers, competitors and potential entrants (Porter, 1980). Organisation’s environment is not just the industry but may include the economic, political, technological and social segments (Fahey & Narayanan, 1986). Of all the four perspectives, adaptive perspective is considered the most appropriate in this context, because it construes organisations as active and capable of adapting to changes in their environments through modifications in firms’ strategies, structures, and processes (Chakravarthy, 1982; Frishammar, 2006). 2.4.2.2  The Resource Dependence Perspective The resource dependence perspective has a prime focus on the significance of resources (Davis & Cobb, 2010). To survive, an organisation requires resources, some of which are outside its control. Therefore, an organisation must interact with others (usually other organisations) who control these resources. This reality makes an organisation dependent on its environment. It reinforces the argument that organisations have boundaries (Pfeffer & Salancik, 1978). The organisation ends, and the environment commences at the point where the organisation’s control over activities shrinks and the control exerted by other organisations or actors begin. This point was succinctly articulated by Pfeffer and Salancik that: The key to organisational survival is the ability to acquire and maintain resources. This problem would be simplified if organisations were in complete control of all the components necessary for their operation. However, no organisation is completely self-contained.

22

2  The Organisation Business Environment Organisations are embedded in an environment comprised of other organisations. They depend on those other organisations for the many resources they themselves require. (Pfeffer & Salancik, 1978:2)

Going by Pfeffer and Salancik’s resource dependence perspective, organisations are therefore externally controlled to some certain extent. This is so because when organisation transacts with others for necessary resources; these others attain power over the focal organisation. This fact makes an organisation dependent on its environment. According to Thompson (1967), an organisation is dependent on others in its environment (1) in proportion to its need for resources or functions that element can offer and (2) in inverse proportion to the ability of other elements to offer the same resources or function. The level of control others have on a focal organisation is evident in how dependent that organisation is on others for pursuing its goals. For instance, handful but large interdependences usually imply that the degree of external control is greater. However, an organisation can lessen its dependence on others by avoiding single large interdependences. It may be better for organisations to develop in a way that permits them to leverage on a variety of interdependences, thereby being less dependent on an individual or a handful exchanges. However, the challenge is not simply that organisations depend on others in the environment but also that the environment is not dependable. Environments may change, new organisations emerge and exit, and the supply of resources may increase or dwindle, but a focal organisation can also change its activities in response to environmental factors through adaptation. Thus, the emphasis of inquiry is how the environment affects organisations. Additionally, the main hypotheses underlying the resource dependence perspective are that organisations are inhibited by their dependence on resources that others possess, which allows others to exercise control over a specific focal organisation. But it is possible for an organisation to adjust these dependences through a process of adaptation (Frishammar, 2006). 2.4.2.3  The Cognitive Perspective This school of thought held that organisations’ perceptions and interpretation of the environment are vital. They also held that comprehending the environment in an objective logic is practically impossible due to its complexity and the limited information-­processing capabilities of organisations (Frishammar, 2006; Starbuck, 1976). Therefore, proponents of this perspective argue that the environment is un-­ analysable (Daft & Weick, 1984). This implies that organisations do not primarily focus on lessening uncertainty through scanning and information-processing activities but rather focus on reducing ‘equivocality’. Where equivocality refers to unclear, chaotic and ambiguous a situation where multiple meanings exist (Frishammar, 2006). Under such scenarios, new information may even increase uncertainty, as it can be understood in diverse ways. According to Daft and Lengel (1986), managers

2.4  Environmental Munificence

23

generate or enact solution instead of learning from new data and information so as to cope with situations of high equivocality. The cognitive perspective holds that what people construe as their environment is generated by human activities and attendant intellectual effort to make sense out of these activities (Smircich & Stubbart, 1985). The core effort of inquiry is centred on how organisations and individuals actors attempt to comprehend their environment (Daft & Weick, 1984; Frishammar, 2006; Starbuck, 1976). 2.4.2.4  The Population-Ecology Perspective This perspective focuses on aggregates of organisations, tackling issues such as market entry and exit and firm growth (Swaminathan, 1996). The central emphasis of population-ecology perspective is the importance it places on selection. This school of thought argues that considering that organisations are structurally inert and slow to change, organisations’ ability to adapt is markedly constrained environmental conditions select certain types of organisations for survival, while other forms extinct (Hannan & Freeman, 1977), However, the idea of organisational selection is not just a case of life or death; rather, it positively selects organisations that are better fit vis-à-vis a particular environment than those that disappear. Aside this, selection impacts are also seen in scenarios where issue of effectiveness rather than survival is of concern. The central theme of population-ecology perspective is focused on how the environment influences organisations, chiefly through the mechanism of selection. As with cognitive perspective, population-ecology perspective views environment as un-analysable or at least close to un-analysable (Frishammar, 2006). Proponents of this perspective argue that over time, organisations cannot correctly and constantly comprehend disparities in unpredictable turbulent environments. This view is predicated on the fact that organisations are often unable to rightly forecast future states of the environment. Also, there is uncertainty that planned alterations will actualise the preconceived change. This explains the evaluation that adaptation to the environment is perceived as haphazard as far as the future is concerned. Generally, organisation environment is broadly classified as internal and external environments (Duncan, 1972). The internal environment of an organisation comprises relevant physical and social factors within the confines of the organisation, while the external environment consists of all relevant physical and social variables outside the boundaries of the organisation. Firm’s internal environment consists of: 1. Organisational employee component—this includes (a) educational and technological background and skills, (b) past technological and managerial skills, (c) interpersonal behaviour styles and (d) individual employee’s participation and commitment to achieving organisational goals.

24

2  The Organisation Business Environment

2. Organisational functional and employees’ units component—this includes (a) intra-unit conflict among firm functional and employees units, (b) interdependence of firm units in implementing their objectives, (c) technological features of firm units and (d) inter-unit conflict among firm’s functional and employees unit (Duncan, 1972; Frishammar, 2006). 3. Organisational domain component—this includes (a) firm goals and objectives, (b) combinative process involving individual employee and groups into contributing optimally to achieving firm goals and objects and (c) nature of firm’s product or service. Firm’s external environment consists of: 1. Buyer/customer component including (a) main users of firm’s products or services and (b) firm’s distributors of products or services 2. Supplier component including (a) equipment’s supplier, (b) product components suppliers and (c) new material suppliers 3. Competitor component including (a) competitors for buyers/customers and (b) competitors for suppliers 4. Socio-political component including (a) relationship with trade associations with influence in the organisation, (b) government regulatory supervision in the industry and (c) societal attitude towards industry and its particular products or services 5. Technological component including (a) achieving new technological standards of own industry and affiliated industries in the manufacturing of products or services and (b) designing and improving new products through adoption of new technological advancement in the industry (Duncan, 1972; Frishammar, 2006; Komori, 2015) Generally, the level of analysing organisational environment by many scholars is that of the organisation context (Duncan, 1972; Rosenzweig & Singh, 1991). This means that organisational environment analysis is conducted from the perspective of a particular focal organisation (Frishammar, 2006; Miles & Snow, 1978; Piercy et al., 1997).

2.5  D  iscussion and Concluding Points on Business Environments Business environment is explained as being multidimensional, multilevel and multi-­ perspective concept. In this chapter, their implications on firm businesses were also discussed. A pluralistic view of the environment offers a robust grasp of the conditions in which business operates. The conditions are uncertain, complex and within the confine of limited resources. Each environmental condition is both multilevel and multidimensional in nature. Depending on nature of the firm and specific situation, some environmental variables are more appropriate than others.

2.5  Discussion and Concluding Points on Business Environments

25

Key Points for Practitioners • Business environment is multidimensional typically uncertain, complex and with limited resources. • Environmental uncertainty lessens organisational ability to create value by limiting the scale and effectiveness of the activities that can be deployed. • Environmental uncertainty and risk coevolve but both are distinct constructs with different impacts, individually and jointly on managerial decision-­making process. • Risk relates to decisions where the outcomes of actions are contingent on identified probability distributions. • Business uncertainty relates to decisions about unknowable or undeterminable future. Manager’s perceived incapability in accurately determining organisational business environment. • Managers facing general uncertain business environments are likely to be more proactive and adopt more innovative approaches than their peers in less turbulent environments • An organisational task business environment entails all organisations or entities with which it must deal with for firm survival and growth. Amidst the growing market uncertainties, many firms are struggling to comprehend their value drivers devoid of market ambiguities. The difficulties in comprehending value drivers might be connected to multidimensional nature of the firm environment. Market surveys and other relevant market-assessing tools are becoming unpopular in the face of increasing market uncertainties and complexities. Environment complexity emanates from human activities. Those organisations that are able to effectively manage the complexity conundrum are likely to develop some competitive advantages. Firms need a model that is capable of adapting to any market situation. Developing such model may be challenging but insight into this could arise from understanding the multidimensional, multilevel and multi-perspective nature of business environment and its implications on the firm context. Recommendation for Future Research • More research efforts that adopt multilevel environmental inquiries approach in organisational adaptation research will be required to ensure a comprehensive research outcome(s). • Research into which dimension of business environment has the most significant impact on organisational adaptation in a given context will further our understanding of achieving desired adaptation. • Research into the key features of organisational task environment/sub-­ environment/resource pool and how they are evolving will be of great importance in understanding organisational adaptation.

26

2  The Organisation Business Environment

Usually there is an environmental level that is most applicable to a particular research inquiry. Scholars should investigate environment at the level that is most relevant to a specific research inquiry. Furthermore, researchers can analyse business environment at multidimensional environmental levels, with more focus on the sub-environment and resource pool. This is because environmental analysis at the sub-environment and resource pool levels could help in comprehending how organisations acquire competitive advantage through exchange and cross-utilisation of resources. Such efforts will encourage analysis of more context-specific propositions, resulting in richer researcher findings and, finally, more advantageous to business practitioners.

Summary of Key Points • Business environment is characterised of three main environmental dimensions, namely, environmental uncertainty, complexity and munificence. • There are three types of business environmental uncertainties; these are environmental state uncertainty, organisational effect uncertainty and decision response uncertainty. • There are four identified environmental complexity types; these are diversity, interdependence, ambiguity and flux. • There are five environmental munificence levels; these are the macro environment, the aggregate environment, the task environment, the sub-­ environment and the resource pool environment. • Three kinds of munificence are identified in the management literature. They are environmental capacity, growth/decline relates and opportunity/ threat; this refers to the degree to which environmental capacity is un-utilised. • In business environment literature, four different perspectives are identified. They are the adaptive, the cognitive, the population-ecology and the resource dependence perspectives.

In adapting to environmental dynamics, core organisational philosophies should be nonnegotiable. Organisations characterised by light rules that operates using a developed learning model are able to quickly adapt to their environments compare to their peers. In such organisations competitiveness is entrenched in its quickness of adaptability and incremental learning archetypes. In studying adaptations in organisation, firms must understand that dynamic and complex activities permeates all environmental levels and is better examined holistically. Embedded in business environments are triggers of organisational adaptations. These triggers must be understood and captured in context before firm can create and appropriate values from them.

Chapter 3

Organisational Concepts and Theories of Adaptation

An extensive theoretical inquiry into existing body of knowledge applicable to organisational adaptations will provide a robust platform in broadening our understanding of the key issues in organisational adaptations. A pluralistic approach is adopted in the course of this inquiry. Adopting a pluralistic approach provides a unique opportunity of reviewing relevant organisational theories that help expand our scholarly understanding of this important organisational concept. This is very important because organisational adaptation being a multifaceted phenomenon demands a multisided approach to aid understanding. A grounded knowledge of relevant concepts, theories and practices applicable to organisational adaptations will be useful in identifying fundamental inherent constituents and concepts essential in any given adaptive behaviour paradigm. Organisational theories and principles explain and influence adaptation modes, patterns and processes within and outside the organisation. Untangling adaptations through the instrumentality of relevant theories helps in deconstructing the adaptation complexity. The complex nature of organisational adaptations is best summarised by Miles, Snow, Meyer and Coleman (1978) that “Any attempt to examine organisational adaptation is difficult, since the process is highly complex and changeable” (Miles et al., 1978:546). However, there seems to be respite in decoding (as it were) the highly complex and changeable nature of organisational adaptation. This clue emanated from Miles and his team: ‘But the complexity of the adjustment process can be penetrated: by searching for patterns in the behaviour of organisations, one can describe and even predict the process of organisational adaptation’ (Miles et al., 1978:547). We assume that one of the ways of exploring patterns in the behaviour of organisations is by understanding the reasons why organisations act [behave] in a certain way. Perhaps the best place to start is to understand the relevant organisational constructs, concepts, theories and perspectives that underlie organisational patterns of behaviour. There are diverse perspectives and concepts that constitute components of a nested organisational phenomenon (i.e. adaptation). It would be useful to examine the related constituent perspectives, theories and concepts that influence © The Author(s) 2018 O.E. Adegbite et al., Organisational Adaptations, SpringerBriefs in Business, DOI 10.1007/978-3-319-63510-1_3

27

28

3  Organisational Concepts and Theories of Adaptation

o­ rganisational adaptations contextually; further insights into this are provided in Chaps. 6 and 7. In doing this, a multi-paradigm and holistic approach is employed considering the complex nature of adaptive processes. An exploration of relevant theories, concepts and perspectives will assist our scholarly understanding of theoretical descriptions of adaptation pathways (Rant, 2007). The theoretical contexts adopted in this work although not exhaustive come from several organisational concepts and theories which include: 1. Resource-based view (RBV) 2. Contingency theory 3. Strategic choice theory 4. Resource dependence theory 5. Organisational ecology 6. Organisational behaviour 7. Institutional theory 8. Organisation ambidexterity 9. Interpretative perspective 10. Transaction cost economics approach 11. Complexity theory [of adaptation] 12. Law of Requisite Variety

3.1  Resource-Based View (RBV) The resource-based view (RBV) of the firm is of immense relevance in organisational studies (see Amit & Schoemaker, 1993; Hamel & Prahalad, 1994; Penrose, 1968; Winter, 1987). This is understandably so because it emphasises not only the existence of resources but also their integration and transformation in ways that help organisations actualise their set objectives (Marcus & Nichols, 1999; Penrose, 1968). The underlying assumption of RBV is that resources that confer competitive advantage on a firm must be confined within its boundaries. The proprietary assumption of RBV is not only about the resource firms own but also about the central notion that firms gain rents by exacting resource position that protects their proprietary resources (Lavie, 2006). Organisations have both tangible and intangible resources. Tangible resources are found in financial and accounting statements (Grant, 1991) and are protected by legal rights (Hall, 1993). Unlike tangible resources, intangible resources are unique attributes of the firm (Marcus & Nichols, 1999). They are largely results of organisational specialised experience in integrating and using resources whose values are not easily assessed or imitated (Barney, 1991; Barney, 1997). Intangible resources are skills, aptitudes and capabilities for organising and assembling other resources to achieve desired objectives. They are characterised by the hard-to-imitate characteristics and behaviours that make intangible resources worthwhile. When pursuing activities, organisations do not have complete understandings to

3.2 Contingency [or Environmental Contingency] Theory

29

function. However, they must know how to coalesce men and material and transform inputs to valuable outputs. They must understand cause-and-effect relationship and harness this knowledge into effective means for steering behaviour. However, it is acknowledged that their understanding of the relationship between actions and outcomes is unlikely to be perfect (Marcus & Nichols, 1999). As Amit and Schoemaker (1993) argue, the ability to combine tangible resources in unique ways makes the assets that organisations own and control valuable. Mahoney and Pandian (1992) argue that some organisations are able to take the exact same set of resources and incorporate them in a different way for better performances. Knowledge is a prime intangible resource for any adaptive-oriented firm. The ability of an organisation to acquire knowledge from external sources is referred to as a firm’s absorptive capacity (Cohen & Levinthal, 1990). This ability depends largely on the firm’s level of prior related knowledge. This implies that what a firm construe to be mere information may constitute valuable knowledge for others and vice versa (Massa & Testa, 2009). The RBV does not provide adequate insight into how organisations gain competitive advantage in an environment where firms maintain repeated and multiple collaborative relationships with business partners (Lavie, 2006). Also, resource in-­ availability and or misuse may not inevitably lead to death of the organisation or serious negative impact, such as low-profit margin or low patronage or brand perception, but they can narrow the margin of adaptation or adaptive capacity. In the face of major environmental impact, part of the reason organisations neglect clear warnings is because of their limited resources and the way such resources are allocated (Marcus & Nichols, 1999). Further relevance of RBV in adaptation is discussed in Chap. 4.

3.2  Contingency [or Environmental Contingency] Theory This states that an organisation structures itself and acts in certain way in an effort to fit with its environment (Child, 1988; Dooley, 2002; Hrebiniak & Joyce, 1985). Contingency approach relates organisational environment and other variables to particular structures of organisation. It takes the view that there is no one optimal structure (Hannan & Freeman, 1977). The structure of an organisation and its accomplishment are dependent upon the nature of the roles with which it is planned to do and the nature of environmental determinants (Child, 1988; Mullins, Christy, & Scott, 2013). In essence, contingency theory stresses the importance of structure as a significant determinant of organisational performance. Contingency theory emphasises the need for flexibility within the organisation (Chakravarthy, 1982; Dooley, 2002). Contingency approach posits that there is no one best way to structure an organisation; it thus offers insights into how circumstantial and contextual factors influence management decisions. Contingency approach is said to be an extension of systems’ perspective as it reveals possible means of differentiating among diverse

30

3  Organisational Concepts and Theories of Adaptation

organisational structures and systems of management (Mullins et  al., 2013). Environmental contingency theory argues that in an environment of repeated, extensive change and high unpredictability, the firm should act flexibly and respond to change in its evolving environment (Miller, 1982; Rant, 2007). The intricacies of contingency theory are best summed up in the words of Hunt (1992): “The concept of contingency also implies that there is no one, absolute ‘best’ design; rather, there is a multitude of possibilities and the best or preferred choice will be contingent on the situation being analysed. … There are common elements in the hierarchies of different organisations but there are also very many differences peculiar to the local situation” (Hunt, 1992:170). As with other organisational theories, contingency theory has been criticised and its limitations highlighted. The criticisms, problems and limitations of contingency approach are centred on the following.

3.2.1  Organisational Performance The general notion of contingency theory is that the fit organisational structures and situational variables are related to optimising organisational performance. But in any given scenario, organisational performance is multidimensional. It is barely visible to derive a singular condition for the suitability of ‘fit’ among diverse organisational structures and improved performance (Child, 1988; Mullins et al., 2013).

3.2.2  Power Factors In addition to contingency situations, there are other factors that influence the preferred organisational structure, such as the power factors like the political context within and outside the organisation, government hegemony of public sector organisations, managerial preferences and organisational culture including the power of social norms. All these contribute to the design of organisational structure (Child, 1988; Mullins et al., 2013; Rant, 2007).

3.2.3  Causal Relationship Contingency models usually imply that a causal relationship exists between organisational structure as an independent variable and organisation performance as a dependent variable. However, it is likely that other elements such as personal characteristics of decision-makers and employees including changes in product markets and prevailing market conditions influence organisation performance discretely from organisational structure (Child, 1988; Mullins et al., 2013).

3.2 Contingency [or Environmental Contingency] Theory

31

3.2.4  Independent Variables The generally assumed notion of the independent ‘contingent’ variables as the ‘preferred’ structure which is beyond the control of other components of the organisation is debatable (Dawson, 1979; Mintzberg, 1979; Mullins et  al., 2013). For instance, Pennings (1975) did not observe a strong evidence for the argument that organisational effectiveness is contingent on the goodness of fit or consistency between environmental and structural variables. Pennings’ observations could likely be traceable to lack of environmental variation (Schoonhoven, 1981).

3.2.5  Multiple Contingencies Organisations face several contingencies, and there is prospect for multidimensional relationships among many organisational variables. However, it is worth noting that different contingencies may necessitate the need for various models of organisational structure (Mullins et al., 2013).

3.2.6  Planned Change In an organisation, contingency types may not provide sufficient emphasis to unforeseen outcomes of planned changes. Examples of these are the outcomes of social interactions among groups of people involved in certain activities and also the consequences of the introduction of novel technology on the internal workings of the organisation (Child, 1985; Pulakos, Arad, Donovan, & Pamondon, 2000).

3.2.7  Scheduling of Organisational Change It is held that many organisations operate under conditions of constant change (Miller, 1982). Growing organisations cannot afford changing their formal structure at frequent interval without experiencing difficulties. In most instances, changes in structure seem to lag behind situational change. It is therefore suggested that there is an element of felicity about whether at any moment in time there is a suitable fit between structure and prevailing contingency variables (Hrebiniak & Joyce, 1985). Summarily, irrespective of the identified criticisms and limitations of contingency theory, the concept has enriched management knowledge of relationships among various factors influencing structure, operations and strategic management in organisation. The approach does help decision-makers to develop a robust understanding of the complex situations in any given context and guide in taking necessary actions (Dawson, 1979; Mintzberg, 1979; Mullins et al., 2013).

32

3  Organisational Concepts and Theories of Adaptation

3.3  Strategic Choice Theory This view emanated from the work of Child in 1972. Child in his studies of organisations investigated the elements of organisational structure and their relationships with situational variables on a systematic comparative basis. He posits that: ‘if organisational structure is not adapted to its context, then opportunities are lost, cost rise and the maintenance of the organisation is threatened’ (Child, 1972:8). The theory integrates environmental structure as an important prerequisite to actors’ internal and external potentials for strategic choice. Environmental contextual elements such as technology and industry size exact constraints on the structural choices managers could make as it relates to work organisations which had to achieve certain degrees of performance in order to survive (Duncan, 1972). Strategic choice refers to the process in which decision-­makers (i.e. top executives/managers or power holders) within organisations select from a series of strategic actions. It entails environment in which the organisation operates, the principles of performance against which pressure of economic constraints has to be assessed and the development of organisation’s structure (Child, 1972). Strategic choices comprise the selection of product and service offerings to customers, the market segments to engage, the business models to adopt, the accurate level of diversification and organisational structures, policies and practices required to coordinate activities (Augier & Teece, 2008). According to Astley and Van de Ven (1983), strategic choice theory focuses on individuals (power holders), their interactions, social constructions, autonomy and choices, in contrast to the constraints of their role incumbency and functional interrelationships in the organisation. There are three (3) critical issues that arise from strategic choice analysis. They are: 1 . The quality of human agency and choice 2. The nature of environment 3. The quality of relationship between the organisational agent and the environment

3.3.1  The Human Agency and Choice This refers to how decision-makers evaluate their organisation’s situation. It includes the ways that social class, occupational and national socialisation may influence managerial beliefs about choices. It draws attention on the features of key organisational actors which may limit the degree of choices that they exercise, even where there are no external constraints. It is relevant in organisational research as it reveals how strong beliefs are held by actors as they enter into discussions and negotiations with others in the organisation and how flexible they will be in altering their beliefs in the course of work pressures of contrary opinions and evidences. Limitations of human agency and choice are seen in action determinism and intra-organisational

3.3 Strategic Choice Theory

33

political process and from inadequate information. Action determinism connotes that given any drive such as preponderant intention to achieve maximum profit, a decision-maker will only select one set of action such as reducing cost to the barest minimum (Child, 1972, 1985).

3.3.2  The Nature of Environment This forms an integral part of strategic choice perspective. Organisational environment presents threats and opportunities for the organisation which found the constraints of choice. Organisational environment is construe as a social entity because it contains cultural and relational opportunities in addition to the ‘task’ and market elements identified by both contingencies and economic theories (Child, 2002). Organisational environment has institutional characters through which people both inside and outside the formal boundaries of an organisation may exchange institutionalised beliefs and relationships. Organisational environment can be viewed as a subjective phenomenon (Hrebiniak & Joyce, 1985). Weick (1969) posits that people in organisations ‘enact’ their environments. This can be understood as people can only be mindful of a concerted generally accepted concept of environment in terms of how they enact it in their minds. Actors in organisations do respond to their own subjective meanings of the environment. In the same vein, people in organisations enact their environments by determining the functions/activities which the organisation performs (Child, 2002; Hrebiniak & Joyce, 1985). However, some scholars argue that organisational environments are real and objective and can be properly discerned by decision-makers. They further posit that managerial perceptions and organisational biases influence the way managers view their environment (Ford & Baucus, 1987; Smircich & Stubbart, 1985); this explains the emergence of interpretation view which is discussed under interpretative perspective in another subheading below.

3.3.3  T  he Quality of Relationship Between the Organisational Agent and the Environment Environment is conceived in terms of how it is socially structured which can be enabling and as well constraining for strategic choice (Whittington, 1988). For instance, organisational actors of the same professional body bound by norms of appropriate or agreed conduct may be externally constrained in their actions, while business owners may be externally enabled to deliberate a wider variety of alternative choices. Also, the cultural and relational norms that members of a sector have in common are likely to constrain organisational actors that seek to deviate from them.

34

3  Organisational Concepts and Theories of Adaptation

3.4  Resource Dependence Theory (RDT) This theory offers an explanation into how organisations reduce environmental interdependence and uncertainty. The main canon of this theory is that organisations move to lessen environmental uncertainties by minimising their dependences on others for resources (Pfeffer & Salancik, 1978). This view is widely accepted by scholars in business management (Aldrich & Pfeffer, 1976; Davis & Cobb, 2010; Hannan & Freeman, 1977; Hillman, Withers, & Collins, 2009). RDT emphasises that power, aside from efficiency or rationality, is critically important for unravelling the actions organisations undertake. It shows how organisation purposefully develops firm autonomy-enhancing strategies that enable it to control resources upon which others are dependent as power and dependency are opposite each other (Dwyer & Oh, 1987). Finkelstein (1997) posits that the extrapolative power of the RDT explanation may be contingent on the historical background in which the firms found themselves. The RDT perspective has been instrumental in exploring inter-organisational relationships particularly how interfirm relationships aid an organisation in acquiring resources to manage business uncertainty and interdependence (Auster, 1994; Harrigan & Newman, 1990). Empirical findings support the adoption of inter-organisational relationships in managing local and global environmental complexity and resource acquisition (Elg, 2000; Hillman et al., 2009; Stearns, Hoffman, & Heide, 1987). Limitations observed in RDT include absence or little boundary conditions. Perhaps this informs the Dubin’s proposition which states that: ‘In order that a model may represent an empirical system, it has to have boundaries corresponding to the empirical system’ (Dubin, 1978: 125). In spite of the documented limitation of RDT, the approach remains a valid theoretical framework with a strong future in strategic management research (Hillman et al., 2009).

3.5  Organisational Ecology (OE) Organisational ecology (OE) explains that survival-enhancing features and selection mechanisms emanate from environmental changes and population density (Hannan & Freeman, 1977). OE also analyses and examines the birth and mortality of organisations within the population over a long period of time; it also covers the concept of new organisational forms (Connelly, Ketchen, & Slater, 2011; Sheth & Sisodia, 2002). Many scholars in organisational ecology widely suggested that organisational change emanates through selection rather than adaptation (Hannan & Freeman, 1989). For example, it is generally held that rates of organisational emergence and mortality are mainly reliant on the market density or number of organisations (e.g. Connelly et al., 2011; Hannan & Freeman, 1989; Lambkin & Day, 1989).

3.6 Organisational Behaviour

35

However, some scholars in population ecology suggest that organisations survive through adaptation and their abilities to locate population niches/thriving market segment that strengthen the chances of survival (e.g. Amburgey & Rao, 1996; Shrivastava, 1995). Longitudinal empirical findings stress the importance of organisational dependability and accountability over time to ascertain survival (Hannan & Freeman, 1989). Indices of survival in broad range of industry studies examined are firm size (the smaller the firms, the more susceptible they are as population density impacts on competition), firm age (the older firms are more reflective of their business environment at the time of creation, and firm inertia inhibit their adaptive abilities) and relative density (proximities of firms to environmental institutions brighten chances of survival) (Amburgey & Rao, 1996; Connelly et al., 2011; Singh & Lumsden, 1990). This theory highlights organisational features and processes that assist organisations to survive over a long time. It also explains how external factors might influence firm’s survival (Shrivastava, 1995). For instance, the institutional environment that regulates adaptable and sustainable business practice is changing swiftly (Rugman & Verbeke, 1998). This implies that old generation firms may experience difficulties in coping with adaptation owing to established method of operations. This may explain why old generation firms are usually burdened with the challenge of organisational inertia (Connelly et al., 2011). Conversely, firms founded in recent years are prone to fierce competition due to liability of greenness (newness), but they are likely to gain from their youthfulness as they may be better suited to adapt to their business environments (Shrivastava, 1995).

3.6  Organisational Behaviour It is a generally acceptable fact that people are the main resource of any organisation. An organisation is only as effective as people working within it (Robbins & Judge, 2009). In contemporary global and competitive business environment, a solid grasp of effective management of the people (i.e. as a critical resource) working in an organisation is crucial for survival and superior performance (Mullins et al., 2013). An organisational behaviour is premised on routines. Action/activity arises from logic of legitimacy or suitability above logic of purpose or outcome. It involves linking organisational procedures to situations (Levitt & March, 1988). Investigating into what drive organisational adaptation will be incomplete without examining the application and influence of organisational behaviour and effective management of people in the context of wider environmental dictates (Hofstede, 1991; Locke, 1976). Organisations often pursue effective management of people and resources for optimum performance through firm’s laid down practices—rules and procedures (Kostova, 1999; Locke, 1976). Many organisations are increasingly pressurised to survive and perform optimally; this necessitates high-level performance with emphasis on achieving desired outcomes and building on strengths (Hofstede & Bond, 1988; Robbins & Judge, 2009).

36

3  Organisational Concepts and Theories of Adaptation

Organisational practices are multifaceted; they include ways in which an organisation conducts its functions which have evolved over time through the influence of organisation’s history, people, styles, interests and activities which have been institutionalised in the organisation (Kostova, 1999). It reflects collective knowledge and capability of the organisation (Berchtold, Pircher, & Stadler, 2010; Szulanski, Capetta, & Jensen, 2004). Organisational practices are widely accepted and adopted by the employees, and ways of performing certain responsibilities are generally overlooked (Szulanski et  al., 2004). The practices encompass various aspects including written and unwritten procedures and rules detailing how certain organisational functions ought to be executed (Berchtold et al., 2010). The rules include the associated array of cognitive elements (e.g. concepts and classifications in which rules are defined). Essentially, such rules and procedures (of organisational practices) reflect a bundle of core values, norms and beliefs (Hofstede, 1991; Nelson & Winter, 1982; Szulanski et al., 2004). Over time such practices become institutionalised within the organisation. Institutionalised practices within an organisation vary extensively. While some are broad focusing on bigger tasks (e.g. company-wide communication procedure, total quality management), others are narrow dealing with precise tasks within a functional area (e.g. organisational practices for employee appraisal) (Berchtold et al., 2010; Hofstede & Bond, 1988).

3.7  Institutional Theory There are many variants of institutional theory, for example, neo-institutional and historical institutional theories (Scott, 1987). In this discussion, it is not our primary task to examine diverse variants but to explore the relevance of the theory in organisational adaptations. A major shortcoming of institutional theory is apparent disagreement over the theoretical meaning and empirical quantification of fundamental concepts such as organisational fields and institutions (Dacin, 1997; Hoffman, 1999). The theory also failed to properly address the subject of change (Hirsch & Lounsbury, 1997; Hoffman, 1999). One of the earliest and most influential variant of institutional theory in organisational studies is the work of Philip Selznick (1957). He construed organisational structure as an adaptive vehicle modelled in response to the features and responsibilities of internal stakeholders as well as the influences and constrictions from the environment (Selznick, 1957). Other prominent works are institutionalisation as a process of enhancing value in social settings (Perrow, 1986; Selznick, 1957) and institutionalisation as a way of creating reality (Berger & Luckmann, 1966); other notable institutional theorists are Meyer and Rowan (1977), DiMaggio and Powell (1983) and Meyer and Scott (1983). Some of these scholars initiated critical changes to the earlier version of institutional theory. For instance, Meyer and Rowan (1977) explained how social systems have diverse institutionalised rules that form a platform under which organisations make their decisions. They posit that institutions function as a collection of working

3.8 Organisation Ambidexterity

37

rules that are used to ascertain firm’s actions that are either accepted or disallowed and what considerations will be apportioned to those actions (Connelly et al., 2011), although there are differences between variants (e.g. neo-institutional theory vs historical institutional theory) on the basis of conformity to institutional norms—a consequence of purposeful decision processes (Connelly et  al., 2011; March & Olsen, 1984). However, both variants viewed organisations within industries as becoming identical in process and structure over time as they pursue conformity by adhering to existing institutional rules. This process happens through three major ways, namely, (1) coercive isomorphism (i.e. emanating pressures from regulators and actors on whom the firm is relying on for resources), (2) mimetic isomorphism (i.e. emanating imitations of other organisations with a motive of reducing cognitive uncertainty) and (3) normative isomorphism (i.e. emanating pressures from social variables such as the media and trade associations) (Connelly et al., 2011; DiMaggio & Powell, 1983). Meyer and Scott (1983) reconceptualised institutional elements of environment by defining it as a technical environment: “those within which a product or service is exchanged in a market such that organisations are rewarded for effective and efficient control of the work process”. This definition was different from institutional environment which says that “institutional environments are characterised by the elaboration of rules and requirements to which individual organisations must conform if they are to receive support and legitimacy…” (1983: 140, 149). The main feature of institutional theory is that institutions function so as to influence change and to determine the nature of structures and contexts. Institutions themselves change in character and effectiveness over time (Dacin, Goodstein, & Scott, 2002; Kostova, 1999). Institutional theory is yet to develop a central set of generally accepted variables; also it is not associated with a standard research methodology (Tolbert & Zucker, 1996).

3.8  Organisation Ambidexterity This refers to an organisation’s ability to simultaneously accomplish alignment and adaptability (Tushman & O’Reilly, 1996). Alignment relates to the synergy within several organisational activities collectively working towards the attainment of same objectives, while adaptability relates to organisational ability to modify or reconfigure itself swiftly in response to changing dictates in its task environment (Gibson & Birkinshaw, 2002; Tushman & O’Reilly, 1996). Inherent in alignment and adaptability are a range of essential resources and capabilities (Gibson & Birkinshaw, 2002). This is borne from the fact that the dictates on organisations in their task environments are often to some extent in conflict (e.g. national agility vs global penetration, differentiation vs low-cost strategy positioning, investment in immediate opportunities vs future projects); thus, organisations would have to face some trade-off decisions. The more an organisation is able to effectively manage such trade-offs and

38

3  Organisational Concepts and Theories of Adaptation

achieve harmonious management of resources, the higher the chances of it achieving long-term superior performance (Gibson & Birkinshaw, 2002). It is argued that such organisational capabilities (of effectively and harmoniously managing firm resources) are embedded in alignment and adaptability. By their characteristics they are complex, broadly dispersed and casually indistinct (Amit & Schoemaker, 1993; Barney, 1991; Gibson & Birkinshaw, 2002; Prahalad & Hamel, 1990; Tushman & O’Reilly, 1996). Scholars in organisational studies have identified various facilitators and sources of organisational ambidexterity (Adler, Goldoftas, & Levine, 1999; Bartlett & Ghoshal, 1989; Tushman & O’Reilly, 1996). They are common organisational culture and vision, decentralised structure and flexible and supportive managers (Tushman & O’Reilly, 1996); periodical employees’ training and trust in working relationship with management (Adler et al., 1999); established career path in top management for executives, training, recruitment and selection; and promoting shared vision in an organisation (Bartlett & Ghoshal, 1989). Conversely, a school of thought posits that ambidexterity is an outcome of self-organisation (Anderson, 1999; Brown & Eisenhardt, 1997; Kaufmann, 1995). In organisational research, the concept of selforganisation refers to the ability of a social system to develop structured patterns of behaviours through periodical random individual behaviours (Gibson & Birkinshaw, 2002; Mathews, White, & Long, 1999; Morel & Ramanujam, 1999). In strategic management studies, the concept is yet to be fully understood, though self-organisation is said to emanate through high degree of energy interaction with the environment, and it is construed as a facilitator of continuous change because the social system (please note self-organisation also has specific meaning in complex theory) is in a condition of dynamic stability (Anderson, 1999; Brown & Eisenhardt, 1997; Nicholls-Nixon, 2000; Prigogine, Nicholis, & Baloyantz, 1972). It is all about making sense of organisational context (Gibson & Birkinshaw, 2002; Kaufmann, 1995; Tushman & O’Reilly, 1996). This refers to the inclination that some organisations enhance a higher degree of motivation and inventiveness among their employees than others (Ghoshal & Bartlett, 1994; Gibson & Birkinshaw, 2002). Organisation ambidexterity is a platform for understanding the ‘conflicts’, ‘mutualities’ and ‘order’ that decision-makers must manage in complex organisational environments (Gibson & Birkinshaw, 2002; Williamson, 1998). Organisation’s ability to promote a supportive organisational context that encourages individual capabilities for alignment and adaptability may be the critical competitive advantage tool available for contemporary managers (Gibson & Birkinshaw, 2002; Tushman & O’Reilly, 1996).

3.9  Interpretative Perspective It is argued that managers utilise diverse logic of references to infer meanings from series of events. However, managers can either be passive observers or active ‘intruders’ by the way they influence their environments, infer from past events and

3.10 Transaction Cost Economics (TCE)

39

make sense of the present occurrence through various interpretative ways (Ford & Baucus, 1987). Such managers are said to ‘invent’ and create their environments through their interpretative prowess (Daft & Weick, 1984; Harvey & Weary, 1981). Managerial (i.e. decision-makers’) interpretations and preferred response choices are not made in isolation of managerial social context (Ford & Baucus, 1987; Hage, 1980 and; Hedberg, Nystrom, & Starbuck, 1976). It therefore implies that managerial interpretation process involves consideration of events in the managerial contextual perspectives. Although this does not connote that managerial interpretation process is influenced by contextual factors, on the contrary, they facilitate the process being part of the experience and the fact by which managerial interpretation is known and formed (Caldwell & O’Reilly, 1982; Ford & Baucus, 1987). Other factors that may influence managerial interpretation process are (1) their knowledge of the performance standards in the industry (Hage, 1980) and (2) past organisational successes—this can influence their interpretation of organisational structural effectiveness (Hedberg et al., 1976). There is high likelihood that managers would rely on the mythologies, sagas of past successes and effectiveness of the established/institutionalised practices in addressing current environmental changes. To decision-makers, this could be particularly enlightening and equally encouraging based on the established reward systems that inspire such practices including institutionalised individual career progression path (Argyris & Schon, 1978; Caldwell & O’Reilly, 1982; Ford & Baucus, 1987). Based on the foregoing, managers cannot predetermine the accuracy of their responses until actions ensue (Ford & Baucus, 1987; Harvey & Weary, 1981). Adaptation outcomes can only be known retrospectively (Ford & Baucus, 1987; Smircich & Stubbart, 1985). Although it is believed that decision-maker’s interpretations may be altered, they are impossible to eliminate. Changing managers, organisational structure, strategy and culture does not eliminate organisational interpretations; it does only changes their fundamentals (bases) resulting in different interpretations (Ford & Baucus, 1987; Hage, 1980).

3.10  Transaction Cost Economics (TCE) This theory recognises organisation not as a producing entity but as a governance structure which is otherwise referred to as organisational construction (Williamson, 1991a). In transaction cost economics, the concept of governance is perfectly responsive to three principles of conflict, mutuality and order (Commons, 1932; Williamson, 1991a, 1998). Each principle is conceived as a unit of activity or transaction (Commons, 1932). Williamson (1998) argued that governance is a means by which ‘order’ is restored in relation to a situation where probable ‘conflict’ threatens to impede opportunities to accomplish ‘mutual’ gains. The process of restoring order so as to realise mutual gain in conflict situations underscores the concept of organisational adaptation. Order is all about restoring equilibrium to a threatened situation—a problem of economic organisation. This narrative is well captured in

40

3  Organisational Concepts and Theories of Adaptation

the words of Chester Barnard: ‘The survival of an organisation depends upon the maintenance of equilibrium of complex character... [This] calls for readjustment of processes internal to the organization..., [whence] the center of our interest is the processes by which [adaptation] is accomplished’ (1938:6)—Emphasis added. In a related study, Friedrich Hayek (1945) conceived organisational adaptations as a central problem of economic organisation. He views adaptations as autonomous in which individual firm reacts to market opportunities as triggered by changes in relative prices, whereas Barnard (1938) conceptualised adaptations as cooperative or purposive in which harmony is achieved through the administration within the organisation. Autonomous adaptation happens naturally when the supply of goods and services offered is absorbed by current demand (Hayek, 1945). This is an emergent process with two unique characteristics. One, prices of goods and services must be predictable for the transaction dynamics to work efficiently (Ghoshal & Moran, 1996; Hayek, 1945; Simon, 1991). For transactions to adapt autonomously, changes in price which show changes in the demand/supply of a good/service must provide a sufficient signal for ‘individual participant … to take the right action’ (Hayek, 1945:527). Furthermore, it is argued that in the absence of other market externalities and [market] failures, prices of goods and services avail people the necessary information about the economy which they require to make judicious use of the available resources (Ghoshal & Moran, 1996; Milgrom & Roberts, 1992). Secondly, autonomous adaptation favours static efficiency. It progresses along the evolutionary trajectory that is reinforced by current relative efficiency and is autonomous [nondependent] on future states (Williamson, 1991b, 1998). Contrast to autonomous adaptation is the purposive/cooperative or coordinated adaptation (Barnard, 1938). It is advantageous over autonomous adaptation in three distinctive ways. One, cooperative adaptation is achievable even when prices or markets are non-existence. Two, it avails organisation opportunities to pursue dynamic efficiencies that leads to new alternatives and further the horizon of activities more than what markets alone can efficiently coordinate. Three, it is argued that collective/shared purpose changes the institutional context in which relationships are grounded and thus influences the behaviours and choices of actors (Ghoshal & Moran, 1996; Williamson, 1991b). Transaction cost economics argues that a high-­ performance organisation [system] requires adaptive capabilities of both autonomous and cooperative adaptations (Williamson, 1998).

3.11  Complexity Theory The term complexity in organisational research refers to structural elements that characterise both organisations and their environments (Anderson, 1999; Daft, 1992). The main idea of this perspective is that organisational study of adaptation seeks to explore strategic change through the lens of complexity theory. It provides

3.11 Complexity Theory

41

insights into how successful firms navigate turbulent business environments by adopting a strategic pathway that places them on the verge of upheaval calmed between order and disorder (Anderson, 1999; Brown & Eisenhardt, 1998). This is essential because organisations could be very complex (Daft & Lewin, 1990; Holland, 1995). Organisational complexity refers to the number of functions or subsystems within the organisation. It is categorised along three domains, namely, (1) vertical complexity refers to the quantity of levels in an organisational hierarchy; (2) horizontal complexity refers to the sum of job titles or strategic business units (SBUs) within the organisation; and (3) spatial complexity refers to the number of geographical locations/spread. Complex organisation is characterised by unpredictable, nonlinear behaviour (Anderson, 1999; Casti, 1994; Daft & Lewin, 1990). Notably, the concept of complexity theory is more relevant to organisations experiencing rapid rate of environmental changes which exceed their internal rate of change (Anderson, 1999; McKelvey, 1997). In those firms that are prone to cascades of external change, organisational adaptations evolve and are not planned (Anderson, 1999). Environmental complexity refers to the aggregate of diverse elements that organisation must handle simultaneously (Anderson, 1999; Scott, 1992). Through organisation design, an organisation seeks to match the complexity of its structure with those of its environment and technology (Anderson, 1999; Galbraith, 1982). A typical contemporary business environment is characterised by several interactions among customers, competitors and government institutions resulting in complex, nonlinear interactions between actions and outcomes. Such environments are hyper-­ competitive (Anderson, 1999; D’Aveni, 1994; Illinitch, Lewin, & D’Aveni, 1998) with a rapid rate of change and unpredictable behaviour. A key feature of complex systems is that they do exhibit self-organising pattern/behaviour, commencing in a random state; they usually evolve towards order rather than disorder (Anderson, 1999; Kauffman, 1993). Usually, s­ elf-­organisation is characterised by a spontaneous process of organisation, resulting in the development of an organised structure. It is the spontaneous formation of an ‘organised whole’ out of a ‘disordered’ set of interacting elements (Heylighen, 1989). Scholars in organisational science have developed approaches to modelling nonlinear interactions within and between organisations. One of such approaches is complex adaptive system model (Holland, 1995). Incorporating complex adaptive system principles to strategic management does facilitate emerging systems [or strategic directions] that can swiftly develop effective adaptive solutions (Anderson, 1999). The emerging systems entail designing and modifying environments within which innovative and effective, self-managed solutions can evolve (Anderson, 1999; Brown & Eisenhardt, 1998; Meyer, Frost, & Weick, 1998). Essentially, complexity theory is a theory with meta-characteristics with the capacity of incorporating diverse perspectives congruently (Axelrod & Cohen, 2000; Rant, 2007; Styhre, 2002). This theory has diverse interdisciplinary roots including several organisational theories that provide significant insights into the behaviour of complex systems (Anderson, 1999; Rant, 2007).

42

3  Organisational Concepts and Theories of Adaptation

3.12  The Law of Requisite Variety (LRV) Primarily LRV emanated and was validated as a law in the field of cybernetics, but it is widely used as an analogy in strategic management research (e.g. Bartel-Radic & Lesca, 2010). LRV has been generally applied to organisational theory to discuss how complex tasks can be better managed in social systems and how social systems can be self-managed (Ashby, 1958; Bartel-Radic & Lesca, 2010). This concept takes insight from biological beings, i.e. organisms in explaining the adaptation phenomenon. It relates the activities going on in the living organism to that of organisation. The size of values (live enhances units) inherent in living organisms is related to their ‘critical variables’ (Ashby, 1958). Ibid, critical variables refer to those essential variables that must be kept within certain ‘physiological’ [functional] boundaries if the organism must survive. Assuming an organism is attacked by bacteria (or disturbance) species, for the organism to survive, it must produce the necessary antitoxin. If the bacteria species are diverse and if each species requires a different antitoxin, then for the organism to survive, it must have a minimum of as many antitoxins in its repertoire of responses as there are in bacterial species (Ashby, 1958). In business parlance, an organisation’s profits/sales represent one of its essential variables that must be kept positive to ensure survival (Ashby, 1958; Bartel-Radic & Lesca, 2010). However, for survival to occur, there must be a regulator. According to Ashby (1958), a regulator refers to elements that confine the actual outcome [survival] to some unit of the likely outcomes. Furthermore, the concept of regulation is germane when there is a set of disturbances [external changes] D, to which the organism [organisation] has a set of responses R or which on any instance it produces say rj. The physiochemical [functional-­structural] interaction then influences the outcome. The outcome [i.e. adaptation] will have some value for the organism [in this case, the organisation], either positive or negative. If the organism [organisation] is favourably adapted, or has the essential capabilities, its response rj, as a variable, will be such that a function of the disturbance di of the outcome [i.e. adaptation] will continually be in the positive continuum. The law of requisite variety states that such regulation is not feasible except the regulator R [given as a channel of communication] has more than a certain capacity. Assuming D threatens to trigger a variety of 20 strains into the outcomes, and if survival requires that the expected outcomes be limited to 4 strains, then at each action, R must produce a variety of at least 16 strains (Ashby, 1958). In contemporary organisation, LRV is applicable to building intercultural teams in response to complex global environments. Teams are regarded as panacea to threats of environmental changes (Bartel-Radic & Lesca, 2010). Teams cope with the challenge of external complexity by drawing from a pool of ideas in response to dynamic changes (Bartel-Radic & Lesca, 2010; Schneider & Barsoux, 2003). The pool of perspectives in teams’ functions in an organisation may be enhanced through diversity (in terms of professional/educational background, individual experiences, age, gender, race and so on). Of note are intercultural teams in organisations. They are essentially created to function and match the diversity of the firm’s business environments (Webber & Donahue, 2001; Weick & Van Orden, 1990) and facilitate firm’s

3.14 Discussion and Conclusion of Organisational Concepts and Theories

43

global competitiveness and local responsiveness (Bartel-Radic & Lesca, 2010; Bartlett & Ghoshal, 1989). Scholars in organisational studies suggest that the concept of LRV buttress why many organisations deliberately encourage team diversity in response to complex global business environments (e.g. Gluesing & Gibson, 2004; Nonaka & Takeuchi, 1995). LRV has further scholarly understanding of dynamics and basis of intercultural business issues (Bartel-Radic & Lesca, 2010). It has been argued that LRV is relevant to management studies principally only on the basis of analogy. Unlike in many science disciplines where a law depicts a widely validated and acceptable formula stating a correlation between tangible element and founded experiments, LRV as the concept of law in management studies has little scholarly relevance. Whereas in science a law connotes a sine qua non condition and is principally a constant principle, in organisational studies, such indispensable idea of constancy or unassailable conditions do not exist (Bartel-­ Radic & Lesca, 2010). This explains why in most instances LRV in management parlance is often referred to as a concept and applied as an alternative form of ‘fit’ in contingency theory (Bartel-Radic & Lesca, 2010; Zeleny, 1986).

3.13  Management Studies and Theoretical Perspectives Management literatures that examine the relationships between theoretical perspectives and firm adaptations are limited; this may be due to the complex nature of the process of adaptations and the unpredictability of the adaptation process(es). However, we suggest that an exploration in this regard will further our understanding of the underlying theories guiding organisational adaptations. There are limited studies that explain how theoretical perspectives influence adaptation types and firm’s industry. A major study in this direction is the work of Rant (2007). In an elaborate study of differences in adaptations between service and manufacturing firms, Rant observed that firms’ adaptations in different industries followed different theoretical paths. For instance, adaptations in manufacturing firms are best explained by environmental contingency theory; adaptations in mixed firms are best explained by resource dependence theory, while adaptations of service firms are best explained by strategic choice theory. Table 3.1 gives a snapshot of some identified theories and concepts.

3.14  D  iscussion and Conclusion of Organisational Concepts and Theories The chapter presents organisational adaptation as a multifaceted phenomenon which demands a multisided approach so as to deepen our understanding of its fundamental theories and concepts at play. Organisational adaptation by its very nature

44

3  Organisational Concepts and Theories of Adaptation

Table 3.1 Key organisational, concepts, theories, perspectives and their implications in organisational adaptations Concepts/theories/perspectives Resource-based view (Barney, 1991, 1997)

Contingency theory (Chakravarthy, 1982; Dooley, 2002)

Strategic choice theory (Child, 1972; Duncan, 1972)

Resource dependence theory (RDT) (Aldrich & Pfeffer, 1976; Davis & Cobb, 2010)

Organisational ecology (Connelly et al., 2011; Hannan & Freeman, 1989; Lambkin & Day, 1989)

Key proposition The resources required to conceive, select, and actualise strategies are heterogeneously distributed across firm. These resources [e.g. capabilities] are lacking in other firms. Such resources have features of imitability and nonsubstitutable germane for gaining competitive advantage The structure of an organisation and its performance are dependent upon the nature of the roles with which it is planned to do and the nature of task environments As environmental elements exact constraints on strategic choices, managers could make choices in response to its task environment; managers’ choices are in turn influenced by internal political processes within the organisation, social constructions and functional interrelationships in the organisation Firms are restricted by their external relationships [environmental interdependence]; managers act to limit the influence others have over them and increase their own power over others Firms’ emergence, evolution and mortality are responses to environmental changes happening around firms

Major reflections in organisational adaptations Resource [in] availability and or [mis]use may (or may not) inevitably lead to death of the organisation or portend serious negative impact

Firm (through its structure(s)) acts flexibly and responds to changes in its evolving environment

Adaptations occur as an outcome of social interactions influenced by human factors within the firm and external [environmental] variables

Firms’ adaptive capabilities are dependent to the extent they depend on others for survival

New firms and firms with diverse variants emerge as influenced by their environments Firms that do not adjust their processes and functions to reflect the changes in their task environments will be selected out and may fail to survive (continued)

3.14 Discussion and Conclusion of Organisational Concepts and Theories

45

Table 3.1 (continued) Concepts/theories/perspectives Organisational behaviour (Hofstede, 1991; Locke, 1976)

Institutional theory (Dacin, 1997; Hoffman, 1999)

Key proposition Organisations’ conducts, decisions and practices are influenced by both individual and collective beliefs, values, norms and cultures that exist in the organisations Organisations conform to institutionalised rules, practices and regulations in their quest for survival and superior performance

Organisation ambidexterity (Gibson & Birkinshaw, 2002; Tushman & O’Reilly, 1996)

For organisations to survive and thrive, they must simultaneously align and adapt their resources to reflect the changes pervading their task environments

Interpretative perspective (Ford & Baucus, 1987; Hage, 1980; Hedberg et al., 1976)

Managers’ interpretative abilities of their strategic choice in response to their environments are influenced by their individual experiences, social contexts and previous organisation successes [failures] Organisations assess the aggregate economic costs of activities before taking management decisions on any activity Various activities, interactions and functions taking place within the firm and its environment are better understood on the features of meta-theory analyses

Transaction cost economics (TCE) (Commons, 1932; Williamson, 1991a, 1998)

Complexity theory (Anderson, 1999; Casti, 1994; Daft, 1992; Daft & Lewin, 1990)

Major reflections in organisational adaptations Both individual and collective styles, culture and norms of decision-­ makers influence the process of organisational adaptations Organisations can enhance the adaptive capabilities to survive and perform optimally by being conversant of and adhering to changes in industry policies and trends evolving in their business environments Organisation’s ability to promote a supportive organisational context that enhances individual and collective capabilities for alignment and adaptability may be the source of organisational critical competitive advantage Organisational adaptations [maladaptations] are outcomes of managerial interpretative capabilities

Organisations will adopt adaptation process(es) when they have economic motivation to do so Organisational [mal]adaptations reflect the complex nature of organisation

(continued)

3  Organisational Concepts and Theories of Adaptation

46 Table 3.1 (continued) Concepts/theories/perspectives The law of requisite variety (LRV) (Ashby, 1958; Bartel-Radic & Lesca, 2010)

Key proposition Organisations must have key elements to survive and thrive in their task environments. These elements are regulated by critical surviving capabilities.

Major reflections in organisational adaptations Organisation is able to adapt to its environment subject to critical [inherent] adaptive ability of its core elements

unsurprisingly draws from a range of theoretical perspectives, including all the reviewed theories and perspectives, but it is not exhaustive. Viewing organisational adaptation from a single theory perspective would connote an ill-conceived and myopic view of this important phenomenon which may have negative consequential effect on firm survival. Each of the reviewed perspectives continues to exert influence in organisational context, even though some of the main questions asked by organisational theorists have evolved or are evolving. Several organisational theories and concepts are at play in any given adaptation process. They could be complementary or conflicting. A sound understanding of these theories would mean better approach in the management of adaptation process. Principal among them are resources-based view (RBV), strategic choice, contingency theory, resource dependence theory and complexity theory.

Key Points for Practitioners • A pluralistic view of intertwined situations and concepts at play in the firm can guide the decision-making process. • Organisation’s ability that promote a supportive organisational context that encourages individual employee’s capabilities for resource alignment and adaptability may be the critical competitive advantage tool available for contemporary managers. • Managers infer from past events and make sense of the present occurrence through various interpretative ways. • Since adaptation process is complex and changeable, examining this phenomenon through a single theoretical perspective will result in a myopic view. • Managerial interpretations of events or context may be altered, but they are impossible to eliminate. • Managers can either be passive observers or active ‘intruders’ by the way they influence their environments. • Organisational adaptations [maladaptations] are outcomes of managerial interpretative capabilities.

3.14 Discussion and Conclusion of Organisational Concepts and Theories

47

Organisations can improve their adaptive capabilities and perform optimally by being conversant of and adhering to changes in industry policies and trends evolving in their business environments. However, organisational adaptive capabilities are dependent to the extent that they depend on others for survival. Adaptations occur as an outcome of social interactions influenced by human factors within the firm and external [environmental] variables. Recommendation for Future Research • Some of the theories and concepts need reviewing, e.g. institutional theory to ascertain grounds (if any) of integrating different variants of the theory and also develop a robust research methodology. • Further analytical review of complimentary and conflicting key concepts and theoretical basis of organisational adaptation will deepen the existing knowledge of the phenomenon. • Longitudinal study may reveal prominent concepts and theories of organisational adaptation at play in various contexts and industries. List of organisational concepts and theories linked to organisational adaptation is not exhaustive; those discussed in this chapter form representation of related and applicable concepts and theories to organisational adaptation. The major action is to hold a broad view of any given adaptation context. This may help in a better management of the adaptation process.

Summary of Key Points • Organisational adaptation is a central problem of any economic [profit-­ oriented] organisation. • Various theories and concepts are at play in any given organisational adaptation context, e.g. resource dependence theory, organisational behaviour, complex theory, transaction cost economics, etc. • A pluralistic approach towards achieving organisational adaptation facilitates a grounded and holistic view of the context which may guide in selecting the most appropriate course of actions.

The process of restoring order so as to realise mutual gain in conflict situations underscores the concept of organisational adaptation. Order is all about restoring equilibrium to a threatened situation—a problem of economic organisation. Describing adaptation from a single theory at best explains ‘an aspect of’ the adaptation process but largely represent an incomplete view of the phenomenon. For instance, the viewpoint of contingency theorists (e.g. Burns & Stalker, 1961; Lawrence & Lorsch, 1967) that the best single organisational arrangement would likely fit a given industry environment has been questioned (Chakravarthy, 1982).

48

3  Organisational Concepts and Theories of Adaptation

Contextual analysis of adaptation will undoubtedly reveal several organisational concepts at play in any given context. This knowledge may guide managers to prepare the appropriate responses; such responses should be void of myopic view in evaluating and handling the complexity of their businesses.

Chapter 4

Adaptive Behaviour Paradigms

This chapter highlights the conceptualisation and importance of adaptive behaviour paradigms (ABPs). Paradigm connotes an implicit or explicit view of reality (Morgan, 1980); it is a ‘way of seeing’ (Morgan, 1979:137). An important way of viewing the organisation by identifying its inherent characteristics. By nature behavioural aspect of organisation is prominent and important in the consideration of any organisational concept (Cyert & March, 1963). Based on this assertion, we posit adaptive behaviour paradigms as way(s) of viewing basic constituents of organisational adaptation. Also, paradigmatic analysis is a generic method of analysing any subject or field of study (Farhoomand, 1987; Hazlett, McAdam, & Gallagher, 2005). The reasons for undertaking a paradigmatic approach in this monograph are the following: 1. To facilitate the comprehension of many perspectives associated with organisational adaptations 2. To generate possible integrated interdisciplinary research directions 3. To provide a basis for analytical examination of various components of organisational adaptation 4. To aid the development of a firm foundation for the design of organisational adaptation processes and approaches The central theme of this chapter is to explain the underlying importance of adaptive behaviour paradigms as the basis for adaptation processes in the organisation. Nine identified adaptive behaviour paradigms are discussed. We begin by explaining what adaptive behaviour paradigms entail.

4.1  Adaptive Behaviour Paradigm Explained Adaptation in organisation, besides being a process, is also a behavioural concept. Organisational behaviour relates to conduct, practices, norms and value of the firm. In the same light, the conducts of an adaptive organisation can be traced to its © The Author(s) 2018 O.E. Adegbite et al., Organisational Adaptations, SpringerBriefs in Business, DOI 10.1007/978-3-319-63510-1_4

49

50

4  Adaptive Behaviour Paradigms

adaptive behaviour. The quest to unravel the underlying adaptive patterns, trends and conducts in any given context led us to conceptualising adaptive behaviour paradigm. In this chapter, we conceptualise practices, beliefs, values and norms of a typical adapting firm as constituents of its adaptive behaviour paradigm. We propose adaptive behaviour paradigms as critical in the process of adaptations in organisation. Adaptive behaviour paradigms reflect the thinking, mind-set or orientation that guide the actions of employees of an adaptive organistion. An understanding of the orientations and dimensions in adaptive behaviour and their antecedents is germane to managers and other practitioners operating in complex business environments. This is because of its role in influencing organisational adaptations in dynamic markets. It is worth stressing here that top managers need to first identify triggers of adaptations both from their external and internal business environments. They can enhance their corporate performance by defining, delineating and reinforcing the actions and beliefs that could translate into an organisational culture that is capable of effecting desirable organisational adaptations (Schein, 2010). Organisations led this way are adaptive and proactive in their business operations (Cravens, 1995). The conducts of an adaptive organisation can be traced to its adaptive behaviour (Day, 2011; Seah, Hsieh, & Huang, 2014). Top managers lead and institute organisational adaptive behaviour paradigms in their respective firms. This helps in aligning corporate culture with departmental and individual beliefs and norms. Well-aligned cultures which we referred to as culture value adaptability enable business leaders to better integrate their firm’s internal processes, which in turn leads to organisational adaptability (Denison & Mishra, 1995) and superior performance (Ouchi, 1981; Peters & Waterman, 1982; Schein, 2010). However, the firm strategic intent does play a vital role in the alignment drive. The importance of strategic intent and organisational leadership in firm effectiveness has been articulated in the strategic management literature (Bowers & Seashore, 1966; Hamel, Doz, & Prahalad, 1989). Proactive managers would review their strategic intent in the face of market dynamics (Hamel et al., 1989). Adaptive behaviour paradigm emphasises the need for organisations to focus on critical dimensions of internal organisational factors, processes and functioning that enhances desirable adaptations particularly in turbulent markets when significant adaptation of business operation is required. In this chapter, nine principal adaptive behavioural paradigms are suggested, namely, market orientation, entrepreneurial orientation, time orientation, managerial orientation, firm resources and reconfiguration orientation, learning orientation, strategic orientation, stakeholder orientation and firm structure and production architecture. By orientation we mean vital standpoint or mind-set that must permeate the corporate firm that intends adapting to effect change(s) in its business environment. These nine orientations must essentially be corporately led and integrated for optimal influence. We construe that these orientations must be both vertically and horizontally galvanised in the organisation in order to achieve desired adaptations. These orientations are discussed in next subsections.

4.2 Market Orientation (MO)

51

4.2  Market Orientation (MO) "Because a market orientation is not easily engendered, it may be considered an additional and distinct form of sustainable competitive advantage". (Kohli & Jaworski, 1990:17)

Various perspectives have emerged on this important paradigm. Examples include a market information processing perspective (e.g. Morgan, Vorhies, & Mason, 2009), as one of the key organisational capabilities essential for creating and increasing customer value (e.g. Martelo, Barroso, & Cepeda, 2013), and a market-­based knowledge assets (e.g. Morgan et  al., 2009). However, we will be guided chiefly by Kohli and Jaworski (1990) and Slater and Narver’s (1994) works. These two are extensive and form the basis of most studies on market orientation. Market orientation is a business philosophy or policy statement and its implementation as evident in the activities and behaviours of firm (Kohli & Jaworski, 1990). It is a feature of organisational culture, a concealed construct which manifests in beliefs, symbols and values, that articulate a concern for markets (Hult, Hurley, & Knight, 2004). It relates to organisation-wide generation of market intelligence as it relates to present and future customers’ needs, its dissemination and responsiveness across departments within the organisation (Kohli & Jaworski, 1990). The term market orientation is not entirely a marketing department concern; it involves series of departments within the firm that participate in the generation of market intelligence, its dissemination and attendant responding by taking appropriate actions (Shapiro, 1988). Essentially, organisations vary to the extent to which they generate market intelligence and how such is internally disseminated and actioned. This view of market orientation implies that every organisation has varied degree of this concept (Kohli & Jaworski, 1990; Narver, Slater, & Maclachlan, 2004). The relevant unit of consideration here is the department or strategic business unit (SBU). It is likely that different SBUs of a firm will be market oriented to varying extents (Kohli & Jaworski, 1990). Based on reviewed management literature, four major antecedents of market orientation are identified. They are (1) executive management factors (individual), (2) inter-SBU dynamics (intergroup) and (3) organisational systems (organisation-wide processes and procedures) and (4) corporate’s culture (Kohli & Jaworski, 1990; Kohli, Jaworski, & Kumar, 1993; Schwartz & Davis, 1981). Of all the identified major antecedents of market orientation, organisational culture has pervasive effect on a firm because it does not only epitomises its relevant employees, customers and other key stakeholders like suppliers, distributors and competitors, but it also describes how a firm relates with its stakeholders (Barney, 1986). Culture is taken to be a range of habitual and conventional ways of thinking, feeling and responding that defines the ways a certain society solves its problems at a particular time (Kluckhohn, 1962; Schwartz & Davis, 1981). It comprises of accepted responses because they have met with success (Kluckhohn, 1962). It is construed that organisational culture defines the pattern of beliefs and shared expectations by people in the organisations. Such beliefs and expectations generate

52

4  Adaptive Behaviour Paradigms

norms that greatly model both individual and group behaviours in the organisation (Schwartz & Davis, 1981). Managerial choices (decisions) reflect their perception of veracity, i.e. beliefs, values and norms (such as cognitive models and dominant reasoning), that successfully worked for them and the organisation during their progression to management position. It is such choices that repeatedly reaffirm organisation’s culture and emphasise the expected organisation-wide behaviour. Thus, the influence of top executive management is critical in nurturing a market orientation (Kohli & Jaworski, 1990; Schwartz & Davis, 1981). It reflects the market mind-set of the organisation as it relates to managerial perception of customer-oriented beliefs, values and other stakeholders (Webster, 1988). There is agreement in strategic management literature that suggests that market orientation is positively associated with firm superior performance in areas such as sales growth, new product successfulness and profitability (Han, Kim, & Srivastava, 1998; Jaworski & Kohli, 1993; Li & Calantone, 1998; Slater & Narver, 1994). However, Pelham (1997) argues that a market orientation would be a less significant performance variable in markets in which cost cutting and mass production are the dominant sources of sustainable competitive advantage. Furthermore, scholars in marketing research posited that exogenous environmental variables like customer’s value perspective like price versus quality have moderating market orientation’s effect on business performance (Grewal & Tansuhaj, 2001; Jaworski & Kohli, 1993; Kumar, Jones, Venkatesan, & Leone, 2011). Also, organisational performance in a competitive environment is dependent on the fitness of corporate strategy and internal consistency of these antecedents of market orientation (Kohli & Jaworski, 1990; Schwartz & Davis, 1981). An organisation that intends to shift its strategy direction perhaps due to market dynamics may find its culture a source of strength or weakness. Culture is usually long term and strategic. It is very challenging to adjust (Venkatraman & Camillus, 1984). This may arise because in itself it can be both durable and strategic in nature. It is very intractable to adapt as it is established and deeply held beliefs and values in which individuals hold a significant asset as the result of some processing of data about organisational activity (Schwartz & Davis, 1981). This explains some of the challenges top managers face in dynamic business environments. Because any effort to adjust the business concern may violate the values and norms on which the managers themselves were appointed in the first instance. In any event, something has to shift for business to survive or attain desirable performance. It is either the culture is altered to match the strategy or the strategy is adjusted to match the culture (Schwartz & Davis, 1981; Venkatraman & Camillus, 1984). This results in corporate (organisation) cultural risk. This [corporate cultural risk] has been defined as a possibility that an organisation will lose some (or all) of its underlying patterns of behaviour in an attempt to adjust dimensions of its culture in an effort to respond to changes in the business environment or in striving for mechanisms to accommodate effects of changing business environment. Simply put it is a chance that an organisation will lose part of its identity—norms, beliefs and values—in the process of modifying its strategy to match the dictates of its

4.2 Market Orientation (MO)

53

business environment or in seeking for ways to manage its dynamic business environment (Schwartz & Davis, 1981). In organisation that is initiating significant strategic shifts, the success of such effort will be contingent upon excellent alignment of culture with changes in organisation structures and systems that result in expected behaviour. This in effect reflects corporate cultural compatibility. In situations where modifications of parts or all of organisation’s culture, system and structure focus on behaviour that is critical for success, the associated risk that firm performance may nose dive increases in instances where culture resists or influences their effect. The probability of experiencing business failure might reduce if top managers have a good grasp of corporate culture and its underlying effect on other organisational factors. In some instances, the scope of desire change may be a mirage subject to prevailing corporate culture. An organisation may achieve desired adaptations in cases where culture value adaptability exists. This is largely featured in many high-technology companies that are continuously evolving. In such companies both culture value adaptability and robust leadership experience in managing change will be key variables (Schwartz & Davis, 1981). The complex business environments necessitate firms to improve their adaptability (Takii, 2007). It is argued that industrial firms with culture value adaptability in their market orientations are likely to develop and adapt services, products and processes that continue to meet the needs of its evolving market. Essentially, continual investments in market orientation are necessary, particularly in highly turbulent industries (Kumar et al., 2011). Firm’s ability to adapt is inherent in the level of its culture value adaptability vis-à-vis other organisational factors (Schwartz & Davis, 1981). It therefore holds that the adaptability of the firm’s values and beliefs is a critical aspect of market orientation. It is responsible for the firm’s ability to do things differently. This is consistent with Jaworski and Kohli’s (1993) view that a market orientation entails doing something differently or new in response to market dynamics. Essentially, firm’s flexibility is a function of its market orientation, and they complement each other (Grewal & Tansuhaj, 2001). Flexibility has been observed to create value when it results in desirable outcomes of decisions (Takii, 2007). Market orientation comprises of three important elements, namely, information gathering, dissemination and responsiveness.

4.2.1  Information (Intelligence) Gathering This transcends information about customers’ needs and preferences. It entails analysis of external factors that influence the changes in customers’ industries and their effects on customers’ preferences. It also involves monitoring competitors’ operations and how it impacts on customers’ preferences. With intelligence gathering organisations are able to anticipate customers’ needs and preferences (Kohli & Jaworski, 1990).

54

4  Adaptive Behaviour Paradigms

4.2.2  Information Dissemination Information gathered must be communicated in a timely manner to relevant individuals and SBUs in the organisation for prompt action. Value-adding information may arise from any of the SBUs in the firm and not necessarily from customer-­ facing employees. Emphasis should be on an effective dissemination of gathered information. It creates a communal platform for collaborative efforts and inputs from various SBUs (Kohli & Jaworski, 1990). Bottom-up and top-down communication in organisation enhance the success of firm goals and objectives (Daft & Steers, 1985). Equally important is the quality of market intelligence generation, dissemination and responsiveness as it impacts on business performance (Cadogan, Souchon, & Procter, 2008).

4.2.3  Responsiveness This refers to participation of all arms of the firm in the process of responding to dynamic market trends in a market-oriented organisation. For instance, selecting choice target markets and the development and offering of valued products/services require the participation of not only sales or marketing unit; it requires the inputs from other units (Kohli & Jaworski, 1990). In contemporary business reality, market orientation would not be complete without the incorporation of the benefits of big data analytics. This [data analytics] refers to the art of probing raw data with the purpose of drawing inferences about that information. Data analytics is adopted in many industries to allow firms make better informed business decisions. With data analytics and continuous testing, firm will be able to draw the appropriate inferences from evidence—particularly something that humans are not naturally good at and also develop necessary skills needed in verifying or disproving existing models or theories (Court, 2015). Modern firms operate in era where tremendous information flows through diverse information technology links like Facebook, Twitter and other social media. Businesses can leverage on useful information emanating through these sources (e.g. market trends, consumer preferences) to their advantage, because information is the currency of present digital age (Fiorina, 2004). Information is now one of the most valuable of firms’ strategic and intellectual assets, but its value is directly proportional to firm ability to turn that information into insightful and profit-generating products and services. Information gathering is not as important as putting information to work. Firm should focus on transforming data from passive to active, from static to dynamic and from data to insight (Fiorina, 2004). The focus of firms should be to make gathered information work for the firm and its customers (Court, 2015; Fiorina, 2004). There are a lot of concerns that arise with the advent of big data analytics. Frontline managers lack understanding and confidence in the analytics

4.3 Entrepreneurial Orientation (EO)

55

and are reluctant to employ it (Court, 2015). Also, existing organisational processes are inept to absorb advancements in analytics and automation, often because procedures for decision-making involve multiple levels of approval. Top management teams need to shift priorities from small-scale exercises to focusing on germane business areas and promoting the usage of analytics across the organisation. And at some instances, jobs and roles need to be reconfigured to reflect and accommodate advancements in digitisation and automation (Court, 2015; Fiorina, 2004). An organisation that quickly adopts new tools and adapts itself to capture their potential is more likely to achieve large-scale benefits from its data analytic efforts. Firms that are leveraging on benefit of big data include Amazon.com, American Express, Procter & Gamble, Walmart and Google (Court, 2015). Put simply, manageability and adaptability of information/data are fast becoming the new technology imperatives (Fiorina, 2004). Considering the foregoing, market orientation is considered as an important element of adaptive behavioural paradigm, because a grounded understanding of customer needs and preferences including competitor activities and other market dynamics enhances a market-oriented firm to discern and develop attendant capabilities. The firm requires such mind-set to actualise its market dominance and sustainable long-term objectives (Day, 1994; Kumar et al., 2011). In any industry or company that is implementing major strategic shifts, success depends on successfully combining the culture with changes in organisational structure, management systems and people to produce desired behaviour. Changes in any of these three aspects of organisation are aimed at behaviour that is crucial to success; the risk that performance will suffer increases if the culture rejects or alters their impact. Can the proposed strategy be successfully implemented in the international division culture? What are the cultural risks? What is their source? These issues have to be looked into and addressed appropriately (Kohli & Jaworski, 1990; Schwartz & Davis, 1981). In summary, the immense contributions of market orientation to firm success have been well documented in marketing and management literatures (e.g. Cadogan et al., 2008; Kohli & Jaworski, 1990; Kumar et al., 2011; Martelo et al., 2013; Morgan et al., 2009). But considering the contemporary sources of market and environmental uncertainties and complexities, there is need to revisit the concept with a view to capture the challenges firms face in addressing the moving target of value adaptability (Day, 2011). The need to expand the concept of market orientation in the face of growing market complexity and uncertainties informed our construction of proposed integrated market orientation as shown in Fig. 4.1.

4.3  Entrepreneurial Orientation (EO) “Championing an entrepreneurial spirit that favours change may help the firm to streamline business processes, promote autonomous decision-making, and tap into individuals’ creative power….” (Wang, 2008: 650)

56

4  Adaptive Behaviour Paradigms

Top management factors

Inter-SBUs dynamics

Organisational systems

Organisational Culture with value adaptability

Firm Market Orientation

Fig. 4.1  An integrated market orientation framework

The entrepreneur (most often the decision-maker) is ‘responsible for the initiation and design of much of the controlled change in his organisation. He continually searches for new opportunities and problems and he initiates improvement projects to deal with these’ (Mintzberg, 1973:168). Entrepreneurial orientation typifies adopted organisational strategies, innovations and activities that enables firm to realise corporate objectives and goals (Hult et al., 2004; Slater & Narver, 1995). It has been linked with proactive competitive demeanour, management likings for risky ventures and firm’s need to involve in ‘bold, wide-ranging acts’ to accomplish its set objectives (Covin & Slevin, 1989; Hult et  al., 2004). Entrepreneurial orientation embodies values that facilitate the development of new businesses within the existing business and/or the rejuvenation of ongoing businesses that need modification (Slater & Narver, 1995). It also refers to the processes, practices and decision-making activities that culminate in new entry. By new entry we mean actions that may be introduced by an individual, a small firm or the strategic business unit of a large corporation. As such, this discussion of entrepreneurial orientation will focus at the firm/business-unit level or the organisational player. It reflects the organisational processes, methods and styles that firms use to act entrepreneurially (Lumpkin & Dess, 1996; Stevenson & Jarillo, 1990). It relates to how the organisational players—firm/SBUs who aim to exploit opportunities and create economic value—concern themselves with both value creation and value appropriation (Alvarez & Barney, 2005). EO emanates from a strategic choice perspective (Child, 1972) which emphasises that new entry opportunities can be successfully pursued by ‘purposeful enactment’ (Van de Ven & Poole, 1995). EO is characterised by five key dimensions, namely, autonomy, innovativeness, risk taking, proactiveness and competitive aggressiveness (Lumpkin & Dess, 1996). In entrepreneurial-oriented firms, these factors are expressed as a tendency to act autonomously, an inclination to innovate and take risks and a propensity to be aggressive towards competitors and proactive relative to marketplace opportunities. All of these factors may be present when a firm involves in new entry.

4.3 Entrepreneurial Orientation (EO)

57

Although each of these dimensions is salient to an EO, it may vary independently in a given context (Lumpkin & Dess, 1996).

4.3.1  Autonomy Autonomy signifies the independent action of an individual or a team in initiating an idea or a vision and executing it through to completion. In general, it connotes the ability and will to be self-directed in the pursuit of market opportunities (Lumpkin & Dess, 1996). In an organisational context, it entails actions taken free of restraining organisational factors. Thus, even though factors such as resource availability, actions by competitive rivals or internal organisational considerations may change the course of new venture initiatives, these are not sufficient to extinguish the autonomous entrepreneurial processes that lead to new entry: throughout the process, the organisational player remains free to act independently, to make key decisions and to proceed. Autonomous entrepreneurial processes do not erase existing constraints such as internal organisational considerations such as resource availability and actions by competitive rivals. In the face of constraints, organisational player—individual/strategic business unit—stays unhindered to act independently, to make vital decisions. In essence, no existing constraining organisational factors are sufficient to stop the autonomous entrepreneurial processes from proceeding to new entry (Lumpkin & Dess, 1996).

4.3.2  Innovativeness This reveals a firm’s predisposition to involve in and support novel ideas and experiments and create processes that may culminate in new products or services or technological processes. Innovativeness is an essential component of an EO as it reflects a vital means by which firms pursue new opportunities (Lumpkin & Dess, 1996). It represents firm’s willingness to depart from existing practices or technological processes and advance beyond the existing state of the art (Kimberly, 1981). Firm innovativeness can be diverse in their level of ‘radicalness’ (Hage, 1980). There are several methods of classifying innovations (Downs & Mohr, 1976), but the most likely advantageous distinctiveness is between product-market innovation and technological innovation (Lumpkin & Dess, 1996). Product-market innovativeness relates to importance of product design, advertising, promotion and market research (Miller & Friesen, 1978; Scherer, 1980). Technological innovativeness relates to attaining competencies in the latest production methods and technologies including the expansion of advanced manufacturing processes (Lumpkin & Dess, 1996). Innovativeness is often characterised by noticeable overlap and combination of product-market and technological innovation. This is seen in the case of technologically advanced new products developed to satisfy specific market demand. In any

58

4  Adaptive Behaviour Paradigms

case, innovativeness is germane in the pursuit of new market opportunities. Evidence of firm innovativeness may take several forms. It may occur along a continuum from a simple keenness to experiment with a different advertising venue to an avid commitment to grasp the latest in technological advances.

4.3.3  Risk Taking Risk has diverse connotations, depending on the context it is applied. In the strategic management context, three types of strategic risk have been identified, namely, (a) ‘venturing into the unknown’, (b) ‘committing a relatively large portion of assets’ and (c) ‘borrowing heavily’ (Baird & Thomas, 1985:231–232). Venturing into the unknown reflects logic of uncertainty. Various risk types are often discussed in the entrepreneurship literature, such as personal risk, psychological risk and social risk (Gasse, 1982; Lumpkin & Dess, 1996). Essentially, entrepreneurial-oriented firms are often typified by risk-taking behaviour, which ranges from incurring huge monetary debt or making large resource commitments to bringing new products into new markets with the aim of obtaining high returns by seizing market opportunities. Although most studies of entrepreneurially related risk-taking research investigate risk at individual levels rather than firms, risk taking at the firm level is particularly relevant to this study. Miller’s (1983) approach to EO measures risk taking at the firm level has been largely recognised. The approach works by enquiring from managers how the firm’s propensity to embark on risky projects and their dispositions for braveness versus cautious acts to actualise firm objectives. An effectively operationalised firm-level risk-taking method remains an area for future development (Lumpkin & Dess, 1996).

4.3.4  Proactiveness Proactiveness reflects a forward-looking perspective accompanied by innovative activity (Lumpkin & Dess, 1996). It refers to processes aimed at foreseeing and acting on future demands by seeking new opportunities which may or may not be related to the present line of operations, introduction of new products and brands ahead of competition, strategically eliminating operations which are in the mature or declining stages of life cycle (Venkatraman, 1989a: 949). A proactive firm leads rather than follows the market dictates, because it has the motivation and foresight to seize new opportunities, even if it is not always the first to do so (Covin & Slevin, 1989). This implies that a firm can be novel, forward thinking, and fast without always being first mover (Lumpkin & Dess, 1996). This negates the narrow school of thought that proactiveness connotes first to act. In their study of 84 SBUs, Miller and Camp (1985) found that the second firm to enter a new market was as enterprising as the first entrant and just as probable to attain success through proactiveness.

4.3 Entrepreneurial Orientation (EO)

59

Largely, proactiveness reflects how firms seize initiative and act opportunistically in order to ‘shape the environment’. They do so by influencing market trends and even create demand (Lumpkin & Dess, 1996). Proactiveness as an element of EO resembles the prospector in the Miles and Snow’s (1978) typology. According to Miles and Snow (1978), prospectors’ main ability is evident in finding and exploiting new products and market opportunities. They create change in their respective industries and thrive over their competitors through the instrumentality of change.

4.3.5  Competitive Aggressiveness This fifth component of EO refers to firm’s proclivity to boldly and passionately challenge its competitors to improve position or achieve market entry. It refers to firm’s propensity to outperform industry rivals. This is expressed in many ways including a disposition to be unconventional rather than rely on traditional means of competing (Lumpkin & Dess, 1996). According to Cooper, Willard and Woo (1986), new entrants do adopt unconventional strategies to challenge industry leaders. Furthermore, competitively aggressive firms analyse and target competitors’ weaknesses (MacMillan & Jones, 1984). They focus on high value-added products while cautiously observing discretionary costs (Woo & Cooper, 1981). Similarly, Porter (1985) suggested three approaches for aggressively pursuing existing firms. These are ‘doing things differently’ or reconfiguration, altering the context, or redefining the product or service and its market channels/scope, and outspending the industry leader. This refers to firm responsiveness directed towards achieving competitive advantage (Lumpkin & Dess, 1996). Competitive aggressiveness may take various forms in demonstration. In entrepreneurship literature there is a tendency to equate proactiveness with competitive aggressiveness (Covin & Slevin, 1989). The terms are often used ­interchangeably, but in reality they are different in meaning (Lumpkin & Dess, 1996). Although the two are closely related, there is an important distinction between them that needs to be explained. Competitive aggressiveness refers to how firms respond to trends and demands that already exist in the marketplace. In contrast proactiveness deals with how firm relates to market opportunities in the process of new entry. Proactiveness relates more with meeting market demand; however, competitive aggressiveness is about competing for demand (Lumpkin & Dess, 1996; Porter, 1985). There are arguments that only those firms that exhibit high levels of innovativeness, risk taking and proactiveness should be regarded as entrepreneurial (Covin & Slevin, 1989; Miller, 1983). However, this approach may be too narrowly conceptualised for explaining some types of entrepreneurial behaviour. For example, Brockhaus (1980) opines that entrepreneurs may be very wary and risk averse under certain contexts. In another study, Nelson and Winter (1982) suggest that imitation may be more beneficial to entrepreneurial firms than high levels of innovativeness.

60

4  Adaptive Behaviour Paradigms

Generally, EO can be best described by diverse dimensions in various combinations due to the development of various typologies of entrepreneurial behaviour. For example, Schollhammer (1982) describes five different types of entrepreneurship, namely, acquisitive, administrative, opportunistic, incubative and imitative. According to Schollhammer, firms adopting the acquisitive type of entrepreneurship achieve new entry into markets through acquiring existing firms. This tactic requires little or no innovativeness, and, if the purchased firm is an established business, it may involve moderately low risk. Cooper and Dunkelberg (1986) suggested that various routes to business ownership compose of different degrees of entrepreneurship. Summarily, irrespective of various schools of thought being articulated in the entrepreneur literature, entrepreneurship remains an essential feature of high-­ performing firms (Peters & Waterman, 1982) and could vary from one context to another and could be multidimensional (e.g. Cooper & Dunkelberg, 1986; Lumpkin & Dess, 1996; Nelson & Winter, 1982; Schollhammer, 1982).

4.4  Time Orientation “Winners in the global market places were able to demonstrate timely responsiveness and rapid and flexible product innovation, coupled with the management capability to effectively coordinate and redeploy internal and external competences”. (Meeus & Oerlemans, 2000: 44).

Time is a significant element in organisational life and one of the most essential organisational features (Bluedorn & Denhardt, 1988). As observed in many social science researches (e.g. Adam, 1990; Ancona, Goodman, Lawrence, & Tushman, 2001a; Jurczyk, 1998), a major dichotomy underlies the concept of time. It is both construed as objective and subjective. Proponents of objective view [or chronos] argue that time is independent of humans (e.g. Clark, 1990; Orlikowski & Yates, 2002). This view is in consonant with Newtonian perspective that time is linear, invariant, abstract and absolute. Several organisational studies be it diachronic or synchronic handle time as quantitative time [which is] continuous, homogeneous and therefore measurable because equal parts are equivalent (Starkey, 1989:42). Under objective view, the clock is generally accepted as a reputable metaphor of time. Conversely, the subjective view [or kairos] of time is conceived as an end product of beliefs, customs and norms of both individuals and groups (e.g. Bluedorn & Denhardt, 1988). The term kairos [taken after the Greek god of opportunity] connotes the human and living time of intentions and goals … the time not of measurement but of human activity, of opportunity (Jaques, 1982:14–15). From a subjective perspective, time is conceived as being organic, contextual and communally created (e.g. Adam, 1990; Jurczyk, 1998). It suggests that it is neither fixed nor invariant which is also considered as event time (Bluedorn & Denhardt, 1988). Clock time particularly in profit-driven/industrial organisations has been linked with ‘machine time’, work discipline and commodification (Adam, 1995; Bluedorn

4.4 Time Orientation

61

& Denhardt, 1988; Orlikowski & Yates, 2002), while event time is considered as qualitative time i.e. heterogeneous, discontinuous, and un-equivalent when different time periods are compared (Starkey, 1989:42). The emphasis here is that the pattern of events be it social, biological or natural is neither fixed nor regular, but is more dynamic, varying by conventions and norms (Orlikowski & Yates, 2002:686). By focusing on one view or the other, scholars in organisational studies may achieve remarkable analytical leap in their temporal enquiries of organisations. But caution must be exercised that such view is treated as a conceptual element and should not dwell on the intrinsic features of time (Orlikowski & Yates, 2002). Although this monograph considers both views as it influences adaptations in various organisational contexts, more interest will be placed on the event-based view with the aim of unravelling the influence of time in dynamic and complex contexts. This will be examined at both the micro (individuals in organisations— managers)- and macro (groups in organisations)-organisational levels and in interactions between the firm and its business environment. For instance, Greenwald (1969) reported that decisions were arrived at faster when their outcomes were more critical. Greenwald also reported that the desirability of alternative choices is mostly related to the criticality of the consequences. However, Pollay (1970) reported that at variance with perception, managers took longer time to make a decision with a challenge when various alternatives were evidently discarded. Time orientation is also about developing organisational wide agility that empowers an organisation to adapt to its business dynamics in real time. It also reflects in situations like time-to-market, time-to-decision and time-to-response (Fiorina, 2004). The significance of time manifests in hyper-competitive market where time is a principal aspect of strategy; its essence is evident in form of unstable processes of firm dynamic capabilities in the context of high-velocity market (Eisenhardt & Martin, 2000). It also reflects in situations where urgency of action is required to take advantage of momentary opportunity in business environment (Hambrick & Fredrickson, 2001). The implications of temporal perspective of time have been highlighted in management literatures (Ancona, Okhuysen, & Perlow, 2001b; Huy, 2001). In his research finding, Huy (2001) posits that the power and style organisations employ in creating change which is depended on how quickly they can act. In another study Blount and Janick (2001) argue that organisational cultures vary with respect to temporal norms and expectations. Temporal view relates to how fast organisational processes and practices are moving (Eisenhardt 1989; Huy, 2001) their pathways overtime (Albert, 1995), the cycles they align with (Ancona, Goodman, et  al., 2001a) and the chronological standings they occupy on time continuum (Blount & Janick, 2001). Speed in making decisions affect firm performance particularly in high-velocity environments (Bourgeois & Eisenhardt, 1988). It is a significant attribute differentiating strategic decisions (Hickson, Butler, Cray, Mallory, & Wilson, 1986). Time orientation provides a vital framework for explaining organisational behaviour (Ancona, Goodman, et al., 2001a; Ancona, Okhuysen, et al., 2001b). Time perspective in organisational studies focuses our attention on new classifications of independent and dependent variables (Huy, 2001). For instance, Ancona,

62

4  Adaptive Behaviour Paradigms

Goodman, et  al. (2001a) posit that sequencing, pacing and period of change are fundamental variables that provide new theoretical insights. Time orientation is a pervasive phenomenon in organisational studies at the macro-level time orientation concerns strategic planning, process management perspective, organisation culture and contingency theory. At micro-level it relates to decision-making, motivation and team behaviour (Bluedorn & Denhardt, 1988). The significance of time in organisational studies is also reveal in entrainment. This relates to how temporal integration can occur in the organisation. Entrainment is a situation in which one cyclic process is synchronised/aligned and set to oscillate in rhythm with another process (McGrath & Kelly, 1986a, 1986b). In organisational studies entrainment is a process that incorporates temporally differentiated functions and behaviours (Bluedorn & Denhardt, 1988). Time orientation also relates to how firm responds to stakeholders at different stages of the organisational life cycle (OLC). Empirical findings reveal that firm behaviour can be predicted through organisational life cycle (Miller & Friesen, 1984; Primc & Čater, 2015). At each stage of OLC, there are peculiar transitional difficulties that emerge which culminate in similar trends of firm behaviour (Primc & Čater, 2015). Essentially, organisational effectiveness has been with OLC stages (Quinn & Cameron, 1983). At any given stage of the OLC, certain stakeholders will be more important than others (Primc & Čater, 2015). Also Quinn and Cameron (1983) in their study revealed a relationship between the OLC stages and organisational effectiveness. The OLC theory has also been identified as essential for future development of the environmental management area (Shrivastava, 1995). In life cycle theory, competitive behaviour of firm is of great importance in two principal stages of market conditions—growth and resource munificence. This may influence divergent and adaptive practice as organisations learn about the marketplace dynamics and seek to develop first-mover advantages (Jarzabkowski, 2004). Considering the foregoing we can adduce that organisations exist and act in time perspectives. Time experienced as events sequenced as past, present or future. The time in an organisational life cycle may influence the type, form of adaptations adopted or lack of adaptations (Miller & Friesen, 1984; Winston, 1988). Perspective time, particularly the present is the inescapable context of all actual social behaviour where actors make decisions now, and they do so without the capacity to control the pace of events or recreate the past, [and] without knowing the events that lie in the future (Winston, 1988:33–34).

4.5  Learning Orientation “All businesses competing in dynamic and turbulent environments must pursue the process of learning, behaviour change, and performance improvement”. (Slater & Narver, 1995:63–64)

It is an organisational attribute that reveals the value that a firm places on learning and events by dexterously responding to changes in the environment (Day,

4.5 Learning Orientation

63

1994). Learning orientation thrives on organisational values such as commitment to learning, open mindedness and organisation-wide shared vision (Baker & Sinkula, 1999). This is manifested as learning-oriented firms make effort to understand and learn from causes-effects of their actions and decisions (Shaw & Perkins, 1991). It is most likely that the pace of business change will increase markedly in the coming years, and emphasis will be placed on the speed and quality of adaptive learning as a strategic imperative variable in a learning-oriented firm (Hess, 2015). Learning orientation refers to firm’s ability to initiate both single-loop (adaptive) learning and double-loop (generative) learning (Argyris & Schön, 1978; Sinkula, 1994). Adaptive learning refers to tactical adjustments in firm’s operations, production and planning. Adaptive learning is construed to facilitate incremental innovation (Baker & Sinkula, 1999; Foster, 1986), while generative learning is an essential organisational learning requirement to affect more fundamental strategic shifts in operations, production and planning. Unlike adaptive learning, generative learning is critical because it reflects an organisation’s capacity to alter its ‘view of the world’ by unlearning old-fashioned perspectives, systems and procedures and proactively swapping them with stratagem that are capable of creating or sustaining competitive advantage (Day, 1991; Dickson, 1996). Generative learning enhances discontinuous innovation—innovation that generates new paradigms (Baker & Sinkula, 1999). Learning orientation relates to continuously engaging existing organisation-wide held beliefs about its business environment and how an organisation should be structured to handle it (Baker & Sinkula, 1999). It functions in a manner that facilitates discontinuous innovation and the advancement of new knowledge in the organisation (Hult et  al., 2004). Because of its ability to challenge conventional organisational norms so that organisation unlearns its old market knowledge, learning orientation is often referred to as ‘higher-order learning’ (Baker & Sinkula, 1999) that results in new behaviours in the organisation (Argyris & Schön, 1978) and continuous improvement (Hult et al., 2004). It is most likely that the pace of business change will increase markedly in the coming years, and emphasis will be placed on the speed and quality of adaptive learning as a strategic imperative variable in a learning-oriented firm (Hess, 2015). Although learning orientation enhances discontinuous innovation (generative learning), it is capable of leading an organisation astray if a strong market orientation is absent to provide solid foundation (Baker & Sinkula, 1999). Learning orientation and market orientation are two important independent constructs but often have synergistic effects on firm performance (Baker & Sinkula, 1999). Learning orientation impacts on firm’s propensity to generate and utilise all kinds of knowledge at its disposal. Furthermore, learning orientation influences the extent to which firms are able to foster generative learning as a core competency (Baker & Sinkula, 1999; Sinkula, Baker, & Noordewier, 1997). Learning-oriented firms are more likely to challenge conventional assumptions about their core operating culture (Slater & Narver, 1995). These firms might even challenge the assumption that market-oriented behaviours are suitable in every situation. They believe it

64

4  Adaptive Behaviour Paradigms

is more appropriate to lead the market, rather than being market led. Thus, learning-­ oriented firms may challenge the idea of a wholly market-oriented approach to new product development (Baker & Sinkula, 1999). The operating philosophy of learning-­oriented firms is that ‘the very nature of competition suggests that no replicable strategy will allow businesses to earn long-run supranormal profits’ (Jacobson, 1992:794). Learning-oriented firms have knowledge-creating cultures (Jarzabkowski, 2004). They are able to hold several interpretations concurrently and also integrate them into the strategic process (Huber, 1991). In such situation, the firm is construed as a knowledge distribution system (Tsoukas, 1996) with bundle of loosely coupled and sundry micro-communities (Brown & Duguid, 2001). Learning is an important facilitator of competitive advantage (Baker & Sinkula, 1999). Organisational learning is a vital complex resource of the firm that can create competitive advantage, albeit it is not the only resource by which a firm might do so (Hunt & Morgan, 1996). Learning is one of a bundle of complex resources that can yield marketplace positions of competitive advantage. However, Dickson (1996) posits that learning is dominant over other resources because it is only organisational learning that enables firms to maintain long-term competitive advantages by constantly improving market information processing (MIP) activities at a faster rate than rivals do. A superior learning environment will leverage the use of all resources, including the behaviours that are associated with market orientation (Baker & Sinkula, 1999). Organisational learning is predated by individual learning (Argyris & Schön 1978). While individual learning is necessary, it is an inadequate condition for organisational learning (Argyris & Schön 1978; Sinkula, 1994).Organisational learning is the means by which knowledge is conserved so that it can be used by individuals other than its inventor. The reality is that individuals come and leave the firm and can have more or less knowledge than the organisation (Argyris & Schön 1978). Although individual and organisational learning is important, of more relevance is the rate at which individuals and organisations learn. This may be the only firm sustainable competitive advantage (Stewart, 1991). In fact, some management scholars found that there exists overlapping between organisational adaptation and learning (Håkansson, Ford, & Johansson, 1999; March, 1991; Viio, 2011). Firm-learning attributes is a resource-deepening behaviour that results in firm’s idiosyncratic competences and capabilities (Karim & Mitchell, 2000). With this view in mind, firm-learning efficiencies equate with recursiveness. This is so as firm becomes ‘perfect’ through learning practices. In this sense recursiveness may be linked to best practice (Jarzabkowski 2004). However, the convergence that reinforces best practice may also be linked to forms of organisational inertial and the elimination of strategic differentiation between competitors (Eisenhardt & Martin, 2000). This dichotomy of recursive practice is expressed as an enigma for successful firms (Jarzabkowski 2004).

4.6 Managerial Orientation (MNO)

65

4.6  Managerial Orientation (MNO) “Drafted plans have to be implemented, put into practise, and for that you need the overall strength of the company—the strength of each division, department, and individual worker. It is when management takes solid steps in the right direction, and when people are motivated to follow that lead, that a company can be turned around… Anyone who worries about everyone else’s opinion when the survival of an enterprise demands decisive action can’t be called a leader”. (Komori, 2015:100,117)

Managers’ held theories of management are critical influence in evaluating an organisation’s capacity to adapt to its environment (Miles & Snow, 1978). Effective leaders perceive organisation as a ‘sociotechnical systems’ and as such remain flexible, suspending immediate decisions whenever possible, until a more comprehensive view of the situation emerges. They are aware that organisations like living beings are ‘open’ to their environment and must achieve an appropriate interaction with their environment if they are to survive. At a pragmatic level, open systems focus on a number of key issues: interaction with stakeholders—customers, competitors, suppliers, distributors, trade unions, governmental agencies and wider ‘general environment’—and liaise with subsytems… individuals who belong to business units or groups that belong to larger organisational divisions (Hess, 2015; Webster, 1988). Managers should have sociotechnical view so as to take cognisant of links between technical, social, managerial, strategic and environmental requirements in order to better manage firm resources. Top managers must make effort to form agreements or ‘alignments’ between diverse systems in order to ascertain and eliminate probable dysfunctions—requisite variety (Morgan, 2011). One of the ways managers can achieve fit is by learning from their employees. For instance, both horizontal and vertical co-evolution will occur as employees learn, grow and develop in their assigned roles. As employees’ skills and experiences increase, they will not only influence each other (i.e. ­horizontal co-evolution) but also start to exert their influence vertically upon their leader (i.e. vertical co-evolution). When this occurs, top managers themselves must adapt to these emerging situations (Heifetz & Laurie, 1997). This will facilitate conducive environment that stimulates employees’ motivation and sense of belonging which are essential in generating innovative ideas (Seah et al., 2014). The prevailing market dynamics demands careful management to achieve and balance internal needs and to adapt to environmental circumstances. While it is given that no one best method of managing the most suitable style depends on the type of task environment, firm must strive to achieve alignments and ‘good fits’ (Hess, 2015; Morgan, 2011; Weick, 1979). Process practices like internal organisational systems are seen as components of the organisational context within which managerial interpretations of environmental issues are shaped and thus influence a company’s choice of environmental strategy. Such processes determine the events and information that managers pay attention to and those that they ignore (Daft & Weick, 1984; Dutton, Fahey, & Narayanan, 1983; Sharma, 2000). And these inter-

66

4  Adaptive Behaviour Paradigms

pretations in turn impact on the actions an organisation takes (Jackson & Dutton, 1988; Weick, 1979) and the environmental strategy it considers. Similarly, the way managers view the unpredictability of novel technologies as threats to their roles (positions) or to their firm’s operations is probable to be averse to risk and to aim at minimising losses rather than maximising gains (Kahneman & Tversky, 1979). Of importance also are the perceptions decision-makers hold about their company’s identity which influence their interpretations of strategic issues as either threats or opportunities (Dutton & Dukerich, 1991). The persisting nature of corporate identity offers array of direction to steer managerial interpretations of strategic issues and influences the ‘ways that an organisation becomes meaningful to individuals and motivates individuals to action in particular ways and at particular times’ (Dutton & Dukerich, 1991:547). This implies that knowledge of an individual’s beliefs about an organisation’s identity is fundamental for sensing the significance of an issue, its connotations and its emotionality (Dutton & Dukerich, 1991; Sharma, 2000). In such scenario when awareness for the environment becomes an integral constituent of corporate identity, environmental issues become ‘harder to disown’ (Weick, 1988:310). Managers must exemplify firm’s core values, norms and beliefs in their decision-­ making processes. Any conflict between corporate value and manager value may have negative impact on firm performance. To effectively steer firm to successful performance, managers [decision-makers] will have to take their learning skills— how they think, listen, emotionally engage and collaborate—to a much higher level (Hess, 2015). Naturally, humans exhibit ‘defensive reasoning’ because humans’ natural reflexive inclination is to deny, defend and deflect information that challenges our self-image or ego. Emotionally, we all tend to be insecure and fearful, and that impacts the quality of our thinking and learning. But proactive managers develop capability for scanning situations with diverse scenarios in mind and of building actions that seem appropriate to resolve them (Morgan, 2011). In addressing challenges in business environment, backgrounds, attitudes, knowledge and skills of managers have ­critical moderating effect of adopted strategic choices (Liesch, Welch, & Buckley, 2011a, 2011b). A series of interactive processes may be at work in moderating the effects of changes in perceived uncertainty and risk on organisational functions so that a consistent path of effects cannot be assumed. Differences among individuals as to how risk is viewed and uncertainty understood confirm wide differences in reaction to common situations (Aragón-Correa 1998).

4.7  F  irm Resources and Reconfiguration Orientation (FRRO) “…for a resource to have enduring value, it must contribute to a firm capability that has competitive significance and is not easily accomplished through alternative means”. (Hart, 1995:989)

4.7 Firm Resources and Reconfiguration Orientation (FRRO)

67

Features of organisational resources markedly influence firm’s competitive advantage capability and by inference its performance (Barney 1986, 1991; Peteraf, 1993). Firm resources are also known as firm-specific assets (Teece, Pisano, & Shuen, 1997). They are distinct fundamental entities deployed in value-creating strategies and their associated activities. They are utilised in functions and systems that deal with particular markets and customers in unique ways and may result in competitive advantage (Eisenhardt & Martin, 2000). They are difficult to imitate; these resources range from operating business secrets and specialised production tools and technical experience (Teece et al., 1997). These resources permeate all aspects of organisational life including human resource management, revenue (i.e. economics and finance), entrepreneurship, marketing and international business (Barney, Wright, & Ketchen, 2001). Organisational resources and capabilities have been identified as the fundamental source of sustainable competitive advantage and the basis for strategy formulation within the firm (Grant, 1996). These firm resources manifest in form of core competencies (Prahalad & Hamel, 1990; Porter, 1996), lean production abilities (Womack, Jones, & Roos, 1990) and configurations (Collis & Montgomery, 1998). Central to resource-based view (RBV) are firm resources (Eisenhardt & Martin, 2000); they are also essential in the development of firm dynamic capabilities (Kogut & Zander, 1992; Teece et al., 1997). The resource-based view conceptualise an organisation as an idiosyncratic assemblage of resources and capabilities that are accessible for utilisation by the firm’s business units but are difficult for rivals to imitate (Amit & Schoemaker, 1993; Mahoney & Pandian, 1992). One of such resources is firm’s knowledge. Knowledge is the greatest resource to an organisation (Lee & Yang, 2000). Knowledge is a major source of competitive advantage and value creation (King & Zeithalm, 2003). It is a central element for the development of dynamic core competencies and a determinant variable for firms with global intentions (Massa & Testa, 2009). Knowledge that an organisation possesses is a dynamic resource that needs to be developed and carefully managed (King & Zeithalm, 2003). While this is desirably expected in all industries, it is particularly relevant in industries where firms have to cope with impact of high-velocity environment (Massa & Testa, 2009). Also knowledge management can be a powerful organisational resource. It refers to the formation of processes and behaviours that enable people to convert information within the organisation, generate ideas and share knowledge. Essentially, it involves people, process, technology and culture. Data and information management is also an integral part of knowledge management. Firm is able to create/acquire knowledge both within and outside the firm. But the effective acquisition of knowledge from external sources depends largely on firm’s ability to identify the value of new external information, assimilate it, apply it and profit from it (Massa & Testa, 2009). The concept of knowledge management is also evident in an organisation’s ability to acquire knowledge from external sources. This ability is often referred to as a firm’s absorptive capacity (Cohen & Levinthal, 1990). A firm’s absorptive capacity depends largely on the firm’s level of prior related knowledge. This implies that what a firm construes to be mere information may constitute valuable knowledge for others and vice versa (Massa & Testa, 2009). Knowledge management also

68

4  Adaptive Behaviour Paradigms

includes storage and retrieval of knowledge which is the process of knowledge structuring and storing that result in formalised and accessible knowledge within the firm (Cohen & Levinthal, 1990; King & Zeithalm, 2003). Knowledge transfer and sharing another aspect of knowledge management refers to the process of transferring, disseminating and distributing knowledge so as to make it available to those who need it. Knowledge application as an aspect of knowledge management is the process of instilling knowledge into an organisation’s products, services and practices to gain value from it (Massa & Testa, 2009). Today’s business environment is not only fast changing; customers are highly knowledgeable, and organisations operate in knowledge-based economies. From the foregoing, it implies that firm’s knowledge, its absorptive capabilities and knowledge management will play a vital role in adaptations processes.

4.8  Strategic Orientation (SO) “Never tell people how to do things. Tell them what to do and they will surprise you with their ingenuity”. General George S. Patton (Cited in Nelsen, 1987:31)

Strategy is from the Greek word strategos; it connotes ‘the art of the general’. To borrow from the intrigues of the battle field, an army general is usually responsible for several elements of the whole. In the same vein, strategic orientation is responsible for the ‘whole’ organisation’s overall objective. A strategy is a fundamental, coherent and externally oriented concept of how the business will achieve its set objectives. It is a class of solution that deals with uncertainty—the possibility that opposing forces may impede you reaching target destination or reaching it in acceptably good shape (Hambrick & Fredrickson, 2001). Strategy is construed as a bundle of resolution evident in three major categories, namely, corporate strategy, business strategy and operational strategy. Corporate strategy is concerned with the overall purpose and magnitude of an organisation and how to enhance value to various strategic business units. Business strategy focuses on the way a business intends to compete successfully in its target market, while operational strategy refers to how diverse parts of the organisation deliver the strategy in terms of managing firm resources, processes and people (McDonald & Wilson, 2011). It is in this light that some management scholars argued that firms do not have just one strategy; they may have a range of strategies—each strategy takes on rivals one at a time (D’Aveni, 2010). However, other scholars argue that firm should have a strategy that focuses on how the business seeks to engage its task environment through an integrated mutually reinforcing array of choices that form a coherent whole (Hambrick & Fredrickson, 2001). Several studies have been documented about strategy, but a winning strategy in an era of dynamic market environment must be flexible, ‘quick-on-the-feet’ and swift to leverage on opportunities as they present themselves (Grant, 1996; Liesch et al., 2011a, 2011b). It is posited that superior result-oriented strategy holds multiple alternatives open and develops desirable flexibility through strategic alliances, outsourcing and diverse means.

4.8 Strategic Orientation (SO)

69

A sound strategy should be as precise as possible. Particular in product categories, market segments and core technologies including the valuing-creating stages, the firm seeks to undertake (Hambrick & Fredrickson, 2001). Closely related to this is the means of achieving the required presence and dominance in the identified market segment, or value-adding stage should be the consequence of deliberate strategic choice. Also it should reflect means by which firms intend to achieve their commercial intention vis-à-vis its associated uncertainty. For instance, a strategic decision to penetrate new product categories is flooded with uncertainty. But such uncertainty may differ markedly based on whether the entry is intended through acquisition, licencing or other means (Liesch et  al., 2011a, 2011b). Whichever means a firm intend to deploy such should have overarching and pragmatic approach else the means may not be beneficial (Hambrick & Fredrickson, 2001). Sound strategy should also emphasise differentiation that drives the firm to attain a strategic position in its market segment. Firm may decide to compete through quality as evident in Honda and Toyota cars in automobile industry. Many car buyers would prefer Honda or Toyota cars as better quality for the price, and this has positioned these car makers in good stead in the automobile industry. Perhaps some consumers might have a different view after the quality crisis they experienced with Toyota cars between 2009 and 2010 (Feng, 2010). As reflected in many Japanese firms, with product differentiation strategy, firm should leverage on its resources and capabilities (Hambrick & Fredrickson, 2001; Porter, 1996). Strategy should leverage on its resources and seeks to pursue ‘early wins’ to achieve its set purpose. It may be beneficial for firm to successfully focus on an aspect of the strategy that is seemly achievable before delving into executing rigorous or more demanding creativities. Closely followed ‘early wins’ drive should be urgency of purpose; this will enable firm to act swiftly in situations where there exists a momentary window of opportunity that demands firm to pursue promptly and aggressively. In any event, at the core of firm strategy is the economic logic that serves as the pivot for generating profit. For strategy to deliver its desired value, it must reflect three strategy models, namely, linear, adaptive and interpretative (Chaffee, 1985). Each strategy model is discussed in detail below.

4.8.1  Linear Strategy Model The linear model views business managers as having extensive capacity to change the organisation (Drucker, 1974). Implicitly, business environment is considered as a necessary burden outside the firm that is composed primarily of rivals. Essentially, linear model argues that managers go through a pattern of rational decision-making process such as strategic planning, formulation and implementation. This model was designed principally for profit-seeking businesses; two of its key measures of performances are profit and productivity (Andrews, 1971; Drucker, 1974; Steiner & Miner, 1977). Linear strategy consists of coherent decisions, activities or actions that will initiate and achieve feasible organisational goals. Both goals and the means

70

4  Adaptive Behaviour Paradigms

of actualising them are outcomes of strategic decision. In order to actualise set goals, organisations vary their interactions with their environments by altering their markets or products/services or by executing other entrepreneurial actions (Andrews, 1971). Linear strategy model subsists not until strategic problem becomes visibly complex in many fronts—economic, technical, managerial problem and psychological, informational process and procedures including social and political challenges (Chaffee, 1985).

4.8.2  Adaptive Strategy Model Central to the adaptive strategic model is the complexity of organisation business environment; this includes complex organisational system, support system, trends, occurrences, competitors and other stakeholders (Chakravarthy, 1982). It is construed that the borderline between the organisation and its environment is extremely permeable, and as such the business [task] environment is a principal focus of attention in determining organisational action (Castrogiovanni, 1991; Chaffee, 1985; Gluck, Kaufman, & Walleck, 1982). Organisational actions either proactively or reactively taken are responsive to the nature and scope of perceived or anticipated environmental influences (Chakravarthy, 1982). Essentially, unlike the linear model, the adaptive model attempts to take more variables and more propensities for change into consideration (Miles & Cameron, 1982). Adaptive strategy relies on several assumptions such as the firm and its environment are assumed to be more open to each other in contrast to the linear models. Also in the adaptive model, the environment is more dynamic and less predisposed to prediction (Chaffee, 1985). The business is complex consisting of customers, competitors, situations, trends and continuing growing importance of stakeholders (Aragón-Correa & Sharma, 2003; Castrogiovanni, 1991). The adaptive model suggests that it can successfully handle greater complexity and more variables than the linear model. Rather than assuming that the organisation must deal with its environment, the adaptive model holds the view that the organisation must change with the environment. However, argument abounds that the situation is complex in other ways (Chaffee, 1985).

4.8.3  Interpretive Strategy Model Interpretive strategy, like adaptive strategy, suggests that the organisation and its environment constitute an open system. But in interpretive strategy, the organisation’s leaders mend the attitudes of stakeholders and prospective stakeholders towards the organisation and its product offerings. Under interpretive strategy model, managers do not make tangible changes in the outputs. In this regard, interpretive strategy overlaps with the adaptive model (Chaffee, 1985). For example, in a scenario where an adaptive strategist focuses on marketing initiatives to enhance

4.8 Strategic Orientation (SO)

71

product reliability, the strategist’s behaviour could be classified as interpretive. This attitude change seeks to increase dependability for the organisation and/or its output. The interpretive model of strategy further assumes that reality is socially constructed (Berger & Luckmann, 1966). This implies that reality is not something objective or external to the perceiver and cannot be adjudged rightly or otherwise. Rather, reality is understood through a process of social interaction in which perceptions are ascertained, modified or replaced, in accordance to their observable conformity with the perceptions of others (Chaffee, 1985). It is the emerging product of the partial resolution of environmental and intra-organisational challenges (Pettigrew, 1977). It is a calculated behaviour in non-sequenced situations (Chaffee, 1985; Van Cauwenbergh & Cool, 1982). It emphasises shifting from the goal orientation of the linear model to a focus on desired relationships, such as those involving sources of inputs or customers (Hatten, 1979). Rather than emphasising changing with the environment, as found in the adaptive model, interpretive strategy imitates linear strategy in its emphasis on tackling the environment. However, there exists fundamental difference between linear and interpretative models. While linear strategist deals with the environment by means of organisational actions that are focused on influencing relations instrumentally, interpretive strategist deals with the environment through symbolic actions and communication (Chaffee, 1984; Pettigrew, 1977). Because strategy is multidimensional, however, examining marketing in combination with other strategic moves allows better classification into either the adaptive or interpretive model. Adaptive strategy emanates to deal with structural complexity, notably conflicting and changing demands for organisational output (Chakravarthy, 1982). Interpretive strategy emphasises attitudinal and cognitive complexity among various actors in the organisation (Pettigrew, 1977). Summarily, each model provides a way of describing a certain aspect of organisational function to which the term strategy has been applied. In linear strategy, decision-makers focus on the organisation plan on how they will deal with say competitors to achieve their organisation’s goals. In adaptive strategy, the organisation and its elements change proactively or reactively, in order to be aligned with say consumer tastes and preferences. And, in interpretive strategy, managers convey meanings that are intended to motivate stakeholders in ways that benefit the organisation. Also, each model is interdependent on the other, although they are sometimes treated as independent in management literatures (cf. Andrews, 1971; Chaffee, 1985; Chakravarthy, 1982). Strategy models can be related to systems hierarchy (Boulding, 1956; Chaffee, 1985). The premise for suggesting that these models are interrelated is that they show some resemblance to a well-known hierarchy of systems in which each level integrates the less complex levels that precede it (Boulding, 1956). If the strategy models were comparable to the systems hierarchy, the relationships among the models would also be hierarchical. The systems hierarchy has distinct similarities to the three strategy models. Certain characteristics at each set of system levels match those of one of the strategy models. Furthermore, similarities between each level of systems and one of the strategy models suggest that an organisation that functions at a given level in the systems hierarchy will gain from using

72

4  Adaptive Behaviour Paradigms

the corresponding model of strategy. Explaining the strategy models through the lens of systems hierarchy makes major three contributions towards further illumination on the strategy construct. First, it suggests a way of ordering and interrelating the dissimilarity, more precisely through focused definitions of strategy in the management literature. Second, divergences between system levels and strategy models suggest areas in which the models could beneficially be developed. Third, the analogy offers leverage for moving from a survey of theoretical literature to its implications for practice. Like in a mechanical system in which information is transmitted between the regulator and the system operator, linear strategy shows similar properties in that the executives [decision-makers] are expected to influence the organisation according to preset goals and to change the goals when circumstances permit (Chaffee, 1985). Adaptive strategy is related to the biological level, in that the model calls for the organisation to inquire, anticipate and respond to diverse elements in its environment. According to Boulding’s (1956) classification of systems hierarchy, the most complex set of system levels is the cultural system. It comprises of the symbol processing level, in which the system is a self-conscious language user, and the multi-cephalous level, a collection of individuals acting in consonant and using detailed systems of collective meaning. Thus, the cultural set is related to interpretive strategy. Interpretive strategy, like the cultural level of systems, focuses on the essentiality of symbol manipulation, collective meaning and cooperative actions of individuals. Although the emphases are the same, interpretive strategy is not as exclusively developed as its correspondence to the cultural level might suggest. Each level in Boulding’s hierarchy incorporates those that preceded it. If the same were true of the strategy models, then adaptive strategy would incorporate linear strategy, and interpretive strategy would incorporate both adaptive and linear strategies. Furthermore, strategic decision-making process may benefit from an investigation of a given situation’s level of complexity. If an organisation or a problem reflects characteristics that are largely mechanistic, a linear strategy is most suitable. Adaptive strategies can be applied when issues of supply and demand are particularly significant. Complex interpretive strategies may be adopted for situations in which modifying the attitudes of organisational stakeholders is the principal tool to performance (Chaffee, 1985). Scholars in strategic management argued that organisations’ strategies must reflect properties of all the three levels of system complexity (Chaffee, 1984, 1985; Cummings, 1983; Gluck et al., 1982). They argued that the three strategy models represent a sequence of phases through which the organisation transformed itself over time. This is so because with time, organisation becomes more sophisticated and proficient in handling market dynamics. They posited that organisations commence with commercial and forecast-based planning (i.e. linear model), then move to strategic analysis (i.e. adaptive model) and eventually achieve strategic management (i.e. interpretive model). It is essential to integrate each lower-level model with models that connote more complex to reflect the true reality of events in the organisation (Chaffee, 1985).

4.8 Strategic Orientation (SO)

73

For instance, Cummings (1983) posits two principal areas in managing the organisation, namely, management by information (i.e. linear/adaptive) and management by ideology (i.e. interpretive). Cummings argued that both themes must be incorporated to achieve a dynamic organisation that serves the purposes of all its stakeholders. However, he did not explain in operational terms how integration is achieved. In another study Chaffee (1984) reported that organisations recovering from poor performance adopted adaptive strategy, but it was their deployment of interpretive strategy that differentiated them from organisations that are unable to recover. However, like Cummings, Chaffee did not reveal how or why the two models were integrated in organisational management. However, Weick and Daft (1983) in their study suggested that one condition of effective interpretation is comprehensive knowledge of the basics of the environment (i.e. adaptive model) so that the event to be interpreted may be seen in context. From all the examined studies, it can be deduced that any strategy that reflects adaptive or interpretive strategy model but ignores less complex strategy models ignores the basis on which it must be built if it is to reflect organisational reality (Chaffee, 1985). The study of the three strategic models identifies three distinct ways of viewing the organisational problem and three kinds of potential solutions. The models may be applied conceptually to investigate a management problem and evaluate alternatives for dealing with it. For instance, a manager might deliberate whether predictions about the dwindling demand for a product are (a) dependent on firm evidence that will provide sufficient lead time for a planning task team to brainstorm and generate alternatives to deal with the fall in product demand—linear model; (b) major shifts in consumer tastes and preferences that could be handled by modifying the product or replacing it with a new product—adaptive model; or (c) indicative of a loss of consumer confidence that could be restored by better marketing to rebuild product acceptability and credibility—interpretative model. However, Chaffee (1985) argues that the optimum value of strategy cannot be achieved in practical terms, until organisational theorists expand the construct to reveal the actual organisational complexities. Each successive level of strategy should incorporate those that are less complex. Some useful suggestions are strategic management scholars that can examine the ways this construct behaves in real organisations. Eventually, the construct may evolve as a single fusion of the three models, such as an interpretive model that integrates adaptive and linear strategy. Or it may evolve as a hierarchy of three models: a mechanistic linear model, a biological adaptive model integrating linear strategy and a cultural interpretive model, incorporating both linear and adaptive strategy. Also strategic management scholars may find value in greater model differentiation by theoretically and empirically leveraging on the richness of complexity of the strategy models. Essentially strategy should reflect the reality of the firm’s task [business] environment in which to a larger extent adaptive interactions between organisation and environment are germane to most firms across many industries, since few [if any] markets are stable, and environments are increasingly perceived as complex because of globalisation, deregulation and technological change (Prahalad & Hamel, 1994).

74

4  Adaptive Behaviour Paradigms

4.9  Stakeholder Orientation “Firm’s stakeholders are embedded directly and indirectly in interconnected networks of relationships … all persons or groups with legitimate interests participating in an enterprise do so to obtain benefits and that there is no prima facie priority of one set of interests and benefits over another”. (Maignan, Gonzalez-Padron, Hult, & Ferrel, 2011:315)

According to Freeman (1984), a stakeholder is ‘any group or individual who can affect or is affected by the achievement of the organization’s objectives’ (Freeman, 1984:46). Firm scans/audits its market, its strengths and weaknesses, its competitors and other stakeholders. One of the reasons firms carry out market audit is to identify and explore capabilities of its key stakeholders. The essence of this is to leverage on and acquire important capabilities through collaborative efforts and networking management. Firm would need to act cautiously and weigh the benefit of such collaboration with its associated disadvantages. Top management can enhance their firm’s adaptive capabilities by sensing the requirements and demands of its various stakeholders (Heifetz & Laurie, 1997; Mishra & Dwivedi, 2012). Five major stakeholder areas important to firm operations have been identified. They are employees, customers and issues of product safety, the natural environment, workplace diversity, and community relations (Berman, Wicks, Kotha, & Jones, 1999). Managers must enhance relationships, motivate stakeholders and build communities that provide a context in which everyone seeks to do their best to deliver value (Berman et  al., 1999). While there is contention in management ­literature about which stakeholder groups deserve or require management’s attention (Sundaram & Inkpen, 2004), stakeholder theory seeks to address this question and other similar issues. For instance, while it is given that the reality of day-to-day managerial decision-making is one that is full with trade-offs and competing claims to resources and outcomes (Berman et al., 1999), managers must realise that the interests of all concerned stakeholders have intrinsic value and that no particular interests should supersede those of the others (Clarkson, 1995). In fact, Freeman and Mcvea (2001) argue that ‘a stakeholder approach rejects the very idea of maximizing a single-objective function as a useful way of thinking about management strategy. Rather, stakeholder management is a never-ending task of balancing and integrating multiple relationships and multiple objectives’ (2001:194). Based on the foregoing, we construe that managers must engage actively with all legitimate stakeholders representing one interest or the other in the strategic decision-­making process. In spite of scanty validated research findings, firm performance has been linked to stakeholder management in the business management literature (Mitchell, Agle, & Wood, 1997); firms doing business based on mutual trust and cooperation with its stakeholders will have a competitive edge over those that do not (Jones, 1995). Firms should view their stakeholders as part of their business environments that must be managed in order to achieve revenues, profits and, ultimately, returns to shareholders (Berman et al., 1999). This school of thought believes that the overall objective of corporate decisions is to excel in marketplace. Managers must know

4.10 Firm’s Structure and Production Architecture (FSPA)

75

that it is the stakeholders who control resources that can facilitate or enhance the implementation of corporate decisions (Pfeffer & Salancik, 1978). In essence, stakeholder management is a means to an end (Berman et al., 1999). The motivation supporting stakeholder orientation and management should be an effort to design and develop a framework that is responsive to the concerns of managers who are constantly confronted with unprecedented levels of environmental turbulence and instability (Freeman & Mcvea, 2001).

4.10  Firm’s Structure and Production Architecture (FSPA) “Flexible, adaptable organisational structure are essential for competing today”. (Cravens, 1995:51)

Empirical findings reveal that firm structural design may impact on proficiency of decision-making in various changing environments (e.g. Lin & Hui, 1997). Where there exists a weak relationship between firm strategy and its structure-­ process features, such weakness may affect firm’s ability to respond swiftly to changes in the market dynamics (Miles & Snow, 1978). Organisational adaptations demand that managers understand both the structural features of their organisation design and the problem-solving attributes of its members (Lin & Hui, 1997). Five structural forms along the spectrum of mechanistic to organic have been identified in management studies. The five structural forms are machine bureaucracy, divisionalised form, professional form, simple form and adhocracy form (Miller & Friesen, 1978; Mintzberg 1979). Generally, it is believed that the environment in which firm operates influences the strategic type and structural form firm deploys (Dooley, 1997). Critical to organisational performance is achieving fit between structural form and firm’s environment. This is the central theme of contingency theory (Lawrence & Lorsch, 1967). Previous organisational studies in the twentieth century reveal that for organisations operating in stable and certain markets, a mechanistic organisational structure is more suitable (e.g. Burns & Stalker, 1961), while in unstable and uncertain markets, an organic organisational structure is said to be appropriate (e.g. Dooley, 1997). Besides these two documented organisational structures, Mintzberg (1979) articulates a hybrid structural form also referred to as the matrix organisation. According to Mintzberg the uncertainty characteristics in business environment necessitate the matrix organisation. A typical feature of a hybrid organisational structure is that it allocates resources particularly employees both along functional lines including within project-related groups. The characteristics of firm environment do influence the strategic type and structural form adopted; in contemporary business environment, it is hardly practicable for firms to survive operating a mechanistic organisational form. In any organisational set-up, noticeable structural features are complexity, formalisation and centralisation (Daft, 1982). These structural features are fundamental because they

76

4  Adaptive Behaviour Paradigms

encompass the vital attributes of how organisations should coordinate and guide the activities of actors, which can markedly influence organisational outcomes. In adapting to changes in business environment, organisations can leverage on their problem-solving abilities. Organisation problem-solving abilities can be inferred from the management style an organisation has employed. Generally lean and mass organisation form has been identified (Lin & Hui, 1999; Womack et  al., 1990). According to Lin and Hui (1999), lean organisation style is dominant management logic among the Japanese firms. Empirical findings revealed that lean management structure avoids wastage of resources, workers at both horizontal and vertical levels are well linked to each other and more importantly all employees are required to anticipate and solve problems. Mass organisation is associated with many Western firms, American firms in particular where firm formalisation is high which enhances workers’ interchangeability. In mass organisation lower-level employees are not required to be problem-solvers. Being essentially semi-skilled, they are assigned small-scope tasks. Mass organisation structure encourages complexity because as organisation grows in size, more specialised jobs and vertical level of command need be created. Also the existence of level of authorities between professionally skilled and semi-skilled employees intensifies centralisation. Owing to the structural type, the decision-making orientation of many mass organisations is reactive (Lin & Hui, 2001). Similarly, Miles and Snow (1978) posit that organisations adopting mass production technology across many of its units do face difficulties in respond to market opportunities quickly. Conversely, lean organisations are typically low in complexity, formalisation and centralisation. This ensures free ­information stream. It also encourages the active participation and involvement of more employees. A firm needs flexible organisational form that is proactive to the prevailing market dynamic in which it operates. Such organisational form must be aligned with the firm’s strategic intent.

4.11  D  iscussion and Conclusion on Adaptive Behaviour Paradigms Organisational adaptation is characterised of adaptive behaviour paradigms. Each behavioural paradigm reflects an integral feature of organisational adaptation and form constituent of the ‘whole’. The emphasis here is to articulate organisational adaptation which has a multi-paradigm behavioural concept. Each paradigm functions in synergy with others to effect survival and growth. For instance, Baker and Sinkula (1999) observed that an organisation’s learning orientation indirectly influences organisational performance by enhancing market-oriented qualities. Also Kropp, Lindsay and Shoham (2006) observe the combinatory effect of entrepreneurial, market and learning orientations on firm performance. The challenge, however, is in appropriate development and alignment of these paradigms. Additionally, these paradigms are intricately connected and vary from context to context. This is

4.11 Discussion and Conclusion on Adaptive Behaviour Paradigms

77

not to conclude that the discussed paradigms are all the related constituents of this organisational phenomenon. Adaptation as a behavioural concept is linked with organisation culture. Culture seeks to reflect communal language, shared values or a resolved or established set of appropriate behaviours (Meyerson & Martin, 1987). Behaviours are embodiments of values, norms, practices and beliefs. Culture has been described as an integrating contraption (Geertz, 1973; Schein, 1983). It forms the social or normative focal point that holds together a theoretically varied group of organisational constituents (Meyerson & Martin, 1987). A case in point is time orientation a pervasive phenomenon in organisational life. At macro-level, it concerns strategic planning, process management, organisation culture and contingency theory. At micro-level time orientation relates to decision-making, motivation and team behaviour.

Key Points for Practitioners • Managers should have sociotechnical view so as to take cognizant of links between technical, social, managerial, strategic and environmental requirements in order to better manage firm resources. • Stakeholders—employees, customers, regulators and competitors—control and/or influence some resources that can facilitate the implementation of corporate decisions; hence, stakeholder management is important and it is a means to an end. • Managers need to develop and build relationships, motivate stakeholders and build communities that provide a context in which everyone seeks to do their best to deliver value. • Managers’ held perspectives of management are critical influence in evaluating an organisation’s capacity to adapt to its environment. • Organisational adaptation is better approached from a pluralistic perspective. It has many sides to its success. • Learning orientation is capable of leading an organisation astray if it is devoid of a strong market orientation as a solid foundation. Learning orientation and market orientation are two important independent constructs but often have synergistic effects on firm performance. • Learning is one of a bundle of complex resources that can yield marketplace positions of competitive advantage. • Organisational learning follows individual learning. While individual learning is necessary, it is an inadequate condition for organisational learning.

The focus of firms should be to make gathered relevant information advantageous to the firm and its customers. Learning impacts on firm’s propensity to generate and utilise all kinds of knowledge at its disposal. Superior result-oriented strategy holds multiple alternatives open and develops desirable flexibility through strategic alliances, outsourcing and diverse means.

78

4  Adaptive Behaviour Paradigms

Recommendation for Future Research • Some of these paradigms still remain at conceptual level with scanty empirical studies in most or all of their elements. For instance, in entrepreneurial orientation, effectively operationalised firm-level risk-taking method remains a challenge for practitioners and academics. • Research efforts have examined how market, learning and entrepreneurial orientations linked; however, other research efforts that link these work to other adaptive paradigms and their significance will extend the existing knowledge in this regard. • Research efforts are directed at understanding the dimensionality, complimentary and interdependence of each of these adaptive behavioural constructs in the adaptation process. The role of contingency and configuration of these adaptive behavioural paradigms in specific adaptation context may be investigated. Such efforts will contribute to further epistemology development in the field of organisational adaptations. • Scholars in management literature argue that a market orientation may be more significant than a learning orientation, on the ground that a strong market orientation mirrors both behaviour and values, whereas a learning orientation only mirrors values. Interestingly common to both market orientation and learning orientation are values that are integral constituents of organisation culture. Would it rather be appropriate to examine the link(s) between organisational adaptation and organisation culture? What are their significances? Are there any complementary features in their underlying assumptions? All considered paradigms can be linked to firm behavioural activities which can be linked with organisation culture. Is it possible to establish a common link or construe organisation culture as embedded in organisational adaptation and vice versa? (cf. Dutton & Dukerich, 1991) Summary of Key Points • The environment in which firm trades influence the strategic type and structural form firm adopts. • Learning-oriented firms have knowledge-generating cultures. • The firm is a knowledge distribution system as it is capable of holding several interpretations concurrently and also integrating them into the strategic process. • Information is the currency of present digital age; firm can harness its benefits by developing capabilities for quick thinking and swift responsiveness. • Information is now one of the most valuable of firms’ strategic and intellectual assets, but its value is directly proportional to firm ability to turn that information into insightful and profit-generating products and services.

4.11 Discussion and Conclusion on Adaptive Behaviour Paradigms

79

All other reviewed paradigms can be linked with market orientation (e.g. Baker & Sinkula, 1999; Kropp et al., 2006; Lumpkin & Dess, 1996). Perhaps the reason why other identified adaptive paradigms are linked to market orientation may relate to its emergence as an important antecedent of performance and has been identified as a key contributor to long-term organisational success (Canoa, Carrillat, & Jaramillo, 2004). Also grounded understanding of customer needs and preferences including competitor activities and other market dynamics enhances a market-­ oriented firm to discern and develop associated or needed capabilities (Table 4.1).

Table 4.1  Summary table of adaptive behaviour paradigms

1.

Adaptive behaviour paradigms Market orientation (Kohli & Jaworski, 1990; Kohli et al., 1993; Schwartz & Davis, 1984) 1. Customer orientation 2. Competition orientation 3. Technological orientation

2.

Entrepreneurial orientation (Covin & Slevin, 1989; Lumpkin & Dess, 1996; Slater & Narver, 1995)

3.

Time orientation (Bluedorn & Denhardt, 1988)

Key proposition The principal theme of market orientation is the firm’s actions in (market/market-related) information gathering and disseminating and processes involved in the creation of superior customer value

It typifies adopted organisational strategies, innovations and activities that enable firm to realise corporate objectives and goals. Expressed in firm’s proactive (and or reactive) competitive demeanour, management likings for risky ventures and the firm’s need to involve in ‘bold, wide-ranging acts’ to accomplish its set objectives Developing organisational wide agility that empowers an organisation to adapt to its business dynamics in real time. The significance of time manifests in hyper-competitive market where time is a principal aspect of strategy; its essence is evident in form of unstable processes of firm dynamic capabilities in the context of high-velocity market (Eisenhardt & Martin, 2000)

Implication for organisational adaptation A firm’s market orientation defines how a particular firm responds to its business environment so as to solve challenges confronting it at a particular time (Kluckhohn, 1962; Schwartz & Davis, 1984) It reflects the organisational processes, methods and styles that firms use to act entrepreneurially by exploiting opportunities through value creation and value appropriation It reflects situations like time-to-market, time-to-­decision and time-to-­response (Fiorina, 2004) It also reflects situations where urgency of action is required to take advantage of long-term firm survival actions or momentary opportunity in business environment (continued)

4  Adaptive Behaviour Paradigms

80 Table 4.1 (continued)

4.

Adaptive behaviour paradigms Learning orientation (Baker & Sinkula, 1999) 1. Adaptive learning and double loop 2. Generative learning (Argyris & Schön 1978; Sinkula, 1994)

Key proposition It reflects tactical adjustments in firm’s operations, production and planning that facilitate incremental innovation It also reflects an organisation’s capacity to alter its ‘view of the world’ by unlearning old-­fashioned perspectives, systems and procedures and proactively swapping them with technique that are capable of creating or sustaining competitive advantage In addressing challenges in business environment, backgrounds, attitudes, knowledge and skills of managers have critical moderating effect of adopted strategic choices

5.

Managerial orientation (Hess, 2015; Liesch et al., 2011a, 2011b; Morgan, 2011; Weick, 1979)

6.

Firm resources and reconfiguration orientation (FRRO) (Barney, 1986, 1991; Lee & Yang, 2000; Massa & Testa, 2009; Peteraf, 1993) Strategy orientation (Hambrick & Fredrickson, 2001)

Knowledge is the greatest resource to an organisation. The knowledge an organisation possess is a major source of its competitive advantage and value creation

Stakeholder orientation (Freeman, 1984; Sundaram & Inkpen, 2004) 1. Employee orientation (Bowers & Seashore, 1966) 2. Relationship orientation (Day, 2000) Firm’s structure and production architecture (FSPA) (Cravens, 1995)

It relates to any group or individual who is affected by or can influence the realisation of the organisation’s objectives

7.

8.

9.

Strategy is construed as a bundle of resolution evident in three major categories, namely, corporate strategy, business strategy and operational strategy

In modern business environment, it is hardly practicable for firms to survive operating a mechanistic organisational form A firm needs flexible organisational form that is proactive to the prevailing market dynamic in which it operates. Such organisational form must be aligned with the firm’s strategic intent

Implication for organisational adaptation It impacts on firm’s propensity to generate and utilise all kinds of knowledge at its disposal for survival and superior performance. It is an important facilitator of firm competitive advantage Conflicts between corporate value and manager value may impact negatively on firm’s adaptive capabilities or superior performance Firm’s knowledge, its absorptive capabilities and knowledge management play vital role in adaptations processes A winning strategic orientation must be flexible, ‘quick-onthe-feet’ and swift to leverage on opportunities as they present themselves Firm performance has been linked to its stakeholder management (Mitchell et al., 1997)

Flexible, adaptable firm structure is critical for competing in contemporary business environment

Chapter 5

Dynamic Capabilities: Drivers of Organisational Adaptations

“Dynamic capabilities contrast with ordinary (or operational) capabilities by being concerned with change’ (Winter, 2003:992). A lot has been written on this important concept. For instance, a search performed on Google Scholar for keywords ‘dynamic capabilities’ generated 2.76 million scholarly work within 0.07  s! Dynamic capabilities have been studied with different approaches by scholars from different research backgrounds. Additionally, scholars with varying focal interest and disciplinary training have applied the concept of dynamic capabilities in their research. This might explain why there is no consensus definition for the concept. However, some early studies that have significant influence in this field of research include the works of Nelson and Winter (1982), Eisenhardt and Martin (2000), Zollo and Winter (2002), Helfat and Peteraf (2003), Teece (2007) and Teece, Pisano and Shuen (1997). Also dynamic capabilities have been applied in various disciplines; some of these include marketing (Bruni & Verona, 2009), sales (Guenzi, Sajtos, & Troilo, 2016), entrepreneurship (Acıkdilli & Ayhan, 2013), service innovation (Kindström, Kowalkowski, & Sandberg, 2013), business network and relationships (Mitrega, Forkmann, Ramos, & Henneberg, 2012) and supply chain (Rai, Patnayakuni, & Seth, 2006). In this chapter, we examine the concept of dynamic capabilities and its significance in organisational adaptation. In doing we examine their antecedents, characterisation and relevance in organisational adaptations. They are construed as fundamental elements in the adaptation process. Challenges associated with dynamic capabilities are also examined. Dynamic capabilities are also linked to firm adaptive practices. This entails new resource configurations that may be developed from the utilisation of existing firm resources. In any given organisational situation, it is the interaction between contexts that provides an opportunity for adaptive practice (Jarzabkowski, 2004).

© The Author(s) 2018 O.E. Adegbite et al., Organisational Adaptations, SpringerBriefs in Business, DOI 10.1007/978-3-319-63510-1_5

81

82

5  Dynamic Capabilities: Drivers of Organisational Adaptations

5.1  Dynamic Capabilities in Organisational Adaptation Dynamic capabilities have been defined in several ways such as ‘a set of specific and identifiable processes that are embedded in firms’ (Eisenhardt & Martin, 2000), ‘combinative capabilities or architectural competence by which firms synthesise and acquire knowledge resources’ and/or recombination of firm’s current capabilities (Henderson & Cockburn, 1994; Kogut & Zander, 1992) and ‘organisational capability’ (Grant, 1996). Also, Eisenhardt and Martin (2000) define dynamic capabilities as ‘the firm’s processes that use resources—specifically the processes to integrate, reconfigure, gain and release resources—to match and even create market change’ (Eisenhardt & Martin, 2000: 1107). All these definitions have something in common—they are geared towards creating novel values for and through the firm, aligning firm’s resources to match business environment externalities. In this respect, dynamic capabilities’ functionality is significant in the adaptation process.

5.2  D  ynamic Capabilities as Drivers of Organisational Adaptations Dynamic capabilities are rooted in organisational resources that underpin differentiation in business offerings. If an organisation is to achieve differentiation in its product/service offerings, it must be different in its capabilities (Augier & Teece, 2008; Penrose, 1959); dynamic capabilities can be viewed as essential determinants of a firm’s performance, competitive and temporary advantages (D’Aveni, 1994; Fang & Zou, 2009; Makadok 2001). They are the drivers of organisational and strategic routines by which decision-makers adjust their resource base by acquiring and discarding or replacing resources, integrating them together and recombining them to produce new value creating strategies (Eisenhardt & Martin, 2000; Grant, 1996). For instance, Lee, Venkatraman, Tanriverdi and Iyer (2010) found that dynamic capabilities fast track the surge of temporary advantages. Chen, Lin and Michel (2010) reported a new antecedent of temporary advantage, namely, aggressive actions which are one of the characteristics of the top management team. Examples of dynamic capabilities include marketing dynamic capabilities (MDC) which denote the ability to create and deliver superior customer value through efficient and quick-response marketing processes (Day, 2011; Fang & Zou, 2009); superior product development, strategic decision-making and alliancing processes are also identified dynamic capabilities (Eisenhardt & Martin, 2000). Firms develop dynamic capabilities through the art of learning (Eisenhardt & Martin, 2000; Zollo & Winter, 2002). The art of organisational learning is central to the formation of firm dynamic capabilities. In fact, learning has been described as a dynamic capability which is ‘a process by which repetition and experimentation enable tasks to be performed better and quicker’ (Teece et al., 1997: 520). It guides the evolution of other dynamic capabilities (Zollo & Winter, 2002). Learning

5.2  Dynamic Capabilities as Drivers of Organisational Adaptations

83

f­ acilitates effective and efficient performance of tasks. It is a result of a firm’s experimentation that allows reflection on failure and success. The knowledge-based and dynamic capabilities literatures focus more on the learning and adaptation involved in competitive advantage (e.g. Eisenhardt & Martin, 2000; Grant, 1996). Knowledge has been implicated as being central to the development of firm dynamic capabilities. It is a fundamental resource of the firm (Eisenhardt & Martin, 2000; Fang & Zou, 2009; Grant, 1996). Knowledge exists in specialised form among individual firm members. Firm dynamic capabilities reflect the integration of individuals’ specialised knowledge in the organisation (Grant, 1996). Repeated practice enhances the creation of firm dynamic capabilities (Argote, 1999). Dynamic capabilities enhance the successful development of flexible integration across multiple knowledge bases within the firm (Grant, 1996). Some of the distinctive qualities of dynamic capabilities are that they are integral to the reconfiguration of firm’s resource base, must be well embedded in the firm and must be repeatable (Ambrosini, Bowman, & Collier, 2009; Helfat & Peteraf, 2003). In firms that are reputable for superior performance, commonalities exist in their effective dynamic capabilities particularly in their observed features otherwise referred to as ‘best practice’ (Eisenhardt & Martin, 2000). They signify firm’s ability to respond to external market dynamics efficiently and promptly (Fang & Zou, 2009). Dynamic capabilities are equifinal in nature; i.e. they can be developed from various starting nodes and along varying paths across the firm (Eisenhardt & Martin, 2000). Dynamic capabilities assume different functions in different market situations. For instance, in moderate dynamic markets, firm routines in the form of dynamic capabilities are inherent in aggregate existing firm knowledge (Eisenhardt & Martin, 2000; Grant, 1996). They entail evaluation using existing organisational knowledge and rules of thumb backed by implementation (Eisenhardt & Martin, 2000); when the deployed existing knowledge is actioned, the emanating routines are usually comprehensive and precise with predictable consequences (Cyert & March, 1963; Helfat, 1997; Nelson & Winter, 1982). Whereas in hyper-competitive markets, dynamic capabilities depend largely on novel knowledge devised for distinct situations (Eisenhardt & Martin, 2000). They take the form of routines that are intentionally straightforward or open to facilitate evolving adaptation through a semi-structured process. Since in high-velocity market dynamic capabilities demand rapid acquisition of new knowledge for specific market situation, pragmatic activities such as real-time information, prototyping, several alternatives and probing that result in instant knowledge are promptly preferred to analysis. Put simply, in high-­ velocity markets, dynamic capabilities are seen in the form of effective routines that are adaptive to changing market situations. The trade-off of adaptability in high-­ velocity markets is the unstable nature of firm dynamic capabilities and the unpredictability of emerging outcomes (Eisenhardt & Martin, 2000). It implies that firms operating in high-velocity environment should both deploy and discard practices more quickly with little time for recursive patterns of response. Essentially for such firms, continuing adaptation is a key survival technique (Brown & Eisenhardt, 1997; D’Aveni, 1994; Jarzabkowski, 2004).

84

5  Dynamic Capabilities: Drivers of Organisational Adaptations

To ascertain whether dynamic capabilities could lead to competitive advantage, it should be assessed on two distinct yardsticks, namely, evolutionary fitness and technical fitness (Helfat et  al., 2007). Evolutionary fitness connotes the extent to which capability facilitates firm survival through creation, extension and modification of its resource pool, while technical fitness relates to the quality feature of capability performance. It focuses on the effectiveness with which a capability achieves its specified function (Ambrosini & Bowman, 2009; Helfat et al., 2007). More studies are required to investigate the internal and external contingencies when assessing the value of dynamic capabilities (Barreto, 2010). In particular, greater efforts should be made to compare the effects of similar dynamic capabilities in clearly distinct environmental conditions, for instance, in several industries/ sectors or different periods of time (Barreto, 2010; Winter, 2003). Essentially, dynamic capabilities are conceptualised to create change within the firm and equally to trigger market change, signifying the interaction between micro- and macro-­ contexts and the ‘birth’ of new resource configuration. Dynamic capabilities and firm capacities thrive best in firms that adopt new forms of organisation structuring (Jarzabkowski, 2004; Pettigrew & Fenton, 2000; Whittington, Pettigrew, Peck, Fenton, & Conyon, 1999). Examples of such organisational structures are heterarchy, and greater processual systems for cross-firm integration enhance the intra-firm knowledge networks (Hedlund, 1994; Nahapiet & Ghoshal, 1998), cellular form (Miles, Miles, & Snow, 1998) and network organisation (Volberda & Baden-Fuller, 1998). They also include shared knowledge and practice (Johnson & Huff, 1998) and increased the use of middle managers and middle-up-down model management (Floyd & Wooldridge, 1997) and intra-firm entrepreneurs or ‘intrapreneurs’ (Nonaka, 1994; Pinchot, 1985). Intrapreneurship relates to the initiation and execution of innovative systems and practices within a firm. This is usually implemented by some employees under the supervision of a manager who assumes the role of an intrapreneur. The purpose is to improve the economic performance of the firm through efficient use of some of its resources through utilisation of an appropriate motivational system for its employees (Istocescu, 2006; Maier & Zenovia, 2011). Some management scholars have been able to establish a link between these innovative forms of organising and firm performance (e.g. Whittington et al., 1999). Most findings particularly cross-continent investigations into organising and structuring in firms confirm the existence of extensive but not radical change in terms of organisational structures, processes and boundaries (e.g. Pettigrew, Massini, & Numagami, 2000). These forms of structuring are avenues for generating dynamic capabilities including adaptive capacities thereby enhancing firm competitive advantage in changing environments (Jarzabkowski, 2004). Firms reputable for effective dynamic capabilities are essentially decentralised in structure (Hedlund 1994). This is evident in firms that operate in dynamic or high-velocity environments, especially in multinational firms with presence in many global markets (Bartlett & Ghoshal, 1993).

5.3  The Challenges of Dynamic Capabilities in Adaptation Processes

85

Some scholars in dynamic capabilities literature have called for the development of ‘higher-order capabilities’ in the firm (Winter, 2003; Zollo & Winter, 2002). Their argument was based on the proposition that changes in exogenous environment are capable of destroying firm competences, and as such organisations that have invested in their routine practices may be disadvantaged, while organisations that have gained flexibility in their routine practices through investments in higher-­ order capabilities will outperform their peers (Collis, 1994; Winter, 2003). Dynamic capabilities are said to consist of four major processes, namely, reconfiguration, leveraging, learning and integration (Bowman & Ambrosini, 2003). Reconfiguration describes the transformation and recombination of firm’s assets and resources, for instance, the alignment of production resources that usually occurs as an outcome of take over. Leveraging describes the extension of a resource by utilising it in a new area. For example, leveraging occurs when a firm relies on its established brand in the production and launch of new set of products. Leveraging also reflects in the replication of system or process that is operating in one arm of a firm into another arm. Learning facilitates activities to be performed more effectively and efficiently, usually a result of experimentation, and allows a reflection on success and failure. And lastly, integration describes firm’s ability to incorporate and coordinate its assets and resources, cumulating in the development of a new resource base (Ambrosini et  al., 2009). Examples of firm capabilities and their implications in firm adaptations are provided below (Table 5.1):

5.3  T  he Challenges of Dynamic Capabilities in Adaptation Processes Criticisms and challenges associated with dynamic capabilities are in part related to the link between this concept and resource-based view (RBV) of the firm and the challenge of recursiveness among others. Arising from its link with resource-based view dynamic capabilities could be static and fixed in nature, a key feature associated with RBV. Proponents of adaptive capabilities (e.g. Day, 2011) believe firms that develop not only dynamic capabilities but adaptive capabilities are better positioned to overcome this challenge. Also managers may face the challenge of making the appropriate choice(s) in managing firm different and complex problems. Addressing firm problems has implications for capabilities. The problem arises when dynamic capabilities such as organisational routines (owing to repeatedly recurring activities/actions sequences) can also sometimes result in severe unsatisfactory, impeding performance particularly when they are automatically channelled onto inappropriate contexts (Cohen & Bacdayan, 1994). These challenges are discussed in the next section.

86

5  Dynamic Capabilities: Drivers of Organisational Adaptations

Table 5.1  Examples of dynamic capabilities and their implications on firm adaptations 1.

2.

Dynamic capability Dynamic marketing capabilities (Fang & Zou, 2009): Specialised and architectural marketing capabilities (Mariadoss, Tansuhaj, & Mouri, 2011; Morgan, Vorhies, & Mason, 2009) Sales capability Pricing capability Product packaging capability Product development capability Channel linking capability Relationship-building capability Technical innovations Non-technical innovations Operations capability (Nath, Nachiappan, & Ramanathan, 2010)

3.

Time and temporal capability (Huy, 2001)

4.

Managerial cognitive capabilities (Helfat & Peteraf, 2015)

Key description The ability to generate and provide superior customer value through effective and speedy-responding marketing processes Key indicators are salesperson effectiveness, strength of distribution network, speed of launch of a new product, promotional effectiveness, customer service quality, skill in segmenting and targeting markets, knowledge of the competition and of customers and in advertising and pricing

Implications for firm adaptations They facilitate market/sales performance and attainment of competitive advantage (Sharma, Reynolds, Scheepers, Seddon, & Shanks, 2010; Weerawardena, 2003) Play principal role in the formation of innovation-based competitive strategy (Mariadoss et al., 2011)

The incorporation of a complex array of tasks performed by a firm to improve its output through the most efficient use of its production capabilities, technology and flow of materials (Dutta, Narasimhan, & Rajiv, 1999; Hayes, Wheelwright, & Clark, 1988) Ability to implement appropriate sequencing and integration of needed intervention types and the path dependence requires attention to both quantitative time and qualitative time The managerial ability to perform both physical and mental activities These include heterogeneity in cognitive flexibility and cognitive capabilities for reasoning, problem-solving, sensing and seizing new opportunities

Superior operations capability improves efficiency in the delivery process, lowers cost of operations and leads to firm competitive advantage (Day, 1994)

Bad timing (even in similar contexts) in sequence of change/adaptation efforts may have devastating implications on the firm performance

Managers with superior cognitive capabilities may accomplish reconfiguration of strategic assets more quickly and with less disruption than their counterparts and may achieve a better design of new business models and increase the likelihood that their firms can obtain in enduring advantages from moving early (continued)

5.3  The Challenges of Dynamic Capabilities in Adaptation Processes

87

Table 5.1 (continued) 5.

Dynamic capability Diversification strategy (Nath et al., 2010)

6.

Sense-making and interpretive capabilities (Neil, McKee, & Rose, 2007)

7.

Strategic proactivity (Aragón-Correa, 1998; Aragón-Correa & Sharma, 2003)

8.

Internal capabilities, external networks (Lee, Lee, & Pennings, 2001) and total quality management (TQM) practice (Powell, 1995)

Key description Entering into a related or unrelated business and/or entering into a new geographic market Facilitating in the development of communicative, interpretive and analytical dimensions of various arms of the firm It refers to firm’s ability to commence modifications in its several strategic practices rather than react to events or situations in its business environment (Aragón-­ Correa, 1998) A strategic resource that comprise of an array of practices that focuses on process redesign, continuous improvement and team-based problem-­ solving, reducing production costs with emphases on enhancing of firm intangible resources

Implications for firm adaptations This is of immense importance to an organisation’s long-term leadership position in its own industry A firm better equipped to maintain and sustain greater internal aspects of the firm that are able to sense and respond to the environment Dynamic environments demand proactive firms to continuously learn and integrate knowledge at its disposal to ensure survival and sustainable performance (Grant, 1996; Powell, 1995) TQM practices built and foster on intangible resources and could be essential to firm survival and success (Szulanski, 1993). Organisations’ ability to marshal external resources, attract customers and identify entrepreneurial opportunities is subject to availability and ability to partner profitable external networks

5.3.1  The Challenge of Recursiveness in Dynamic Capabilities Inherent in dynamic capabilities is the menace of recursiveness. “It [recursiveness] means the socially accomplished reproduction of sequences of activity and action because the actors involved possess a negotiated sense that one template from their repertoire will address a new situation. [While] recursiveness is always improvised … equally, there can be a durability about recursiveness that constrains attempts to transform the sequences” (Clark, 2000:67).

This position substantiates many propositions in strategic management studies (e.g. Hannan & Freeman, 1984; Rumelt, 1995). Recursiveness has been found at three distinctive levels, namely, the actor, the organisation and the social institution (Jarzabkowski, 2004). At the actor’s level, the problem of recursiveness is markedly related to individual cognitive status. Individual cognition is associated with social structure through its manifestation as communal occurrences shared by groups of actors. In turn individual cognitions of actors are conditioned on structural influences such as heuristic procedures (Newell, 1962), accepted operating procedures (Cyert & March, 1963) and embedded cognitive recipes (Weick, 1969).

88

5  Dynamic Capabilities: Drivers of Organisational Adaptations

The groundwork of routinized and established structures through communal cognition is well documented in management literatures on top management team homogeneity (Wiersema & Bantel, 1992), ‘groupthinking’ (Janis, 1972) and restricted learning capabilities (Tripsas & Gavetti, 2000). The recursiveness arising from actors requires a sense of order and continuity as it relates to an individual’s experiences, i.e. ontological security (Brown, 2000; Giddens, 1991). Paradoxically, repeated practice enhances the creation of firm dynamic capabilities (Argote, 1999). Perhaps this explains why some scholars argue for the development of adaptive capability in firms as a panacea for solving recursiveness menace (e.g. Day, 2011). For instance, in sales and marketing discipline, adaptive capabilities are enhancing capabilities that facilitate forward-looking actions, anticipate market trends and events before they are clear or visible/discernible and then adapt effectively. They enable the sales organisation to adapt its strategies to match fastchanging markets. These enhancing capabilities are unique owing to their anticipatory and experimental features they add to the market learning capability. They are also reputable for championing a capacity for ‘open’ marketing that coordinates the capabilities of network alliances. Adaptive capabilities therefore stimulate the existing marketing and sales capabilities to become more responsive to increasing market changes (Day, 2011). The first step to increase adaptiveness is to diversify the talent pool with people that are not tied to conventional and unquestioned conjectures. In the described sales and marketing context, dynamic capabilities are insufficient to spearhead firms’ efforts in closing the capability gap needed in fastchanging market environments. At organisational level, recursiveness is said to be path dependence, persistent organisational routines and organisational memory (Jarzabkowski, 2004). Path dependence implies firm resources are difficult to reconfigure quickly or discard. To remain competitive, an organisation is expected to exploit and build upon its existing resources (Gibson & Birkinshaw, 2002; Grant, 1991). An organisation is a specific bundle of routines that arise from the co-evolution between corporate patterns of knowledge distribution and governance mechanisms (Coriat & Dosi, 1998; Karim & Mitchell, 2000). Governance mechanisms of a firm relate to both formal and informal incentive and control systems, legal regimes, organisational structures and corporate cultures. It will usually be influenced by path dependency and confined search, which result from the tacitness, co-specialisation and organisational embeddedness of routines (Capron & Mitchell, 1999; Kogut & Zander, 1992). However, the tacit feature of routines is either link to their intrinsically uncodifiable traits or because they are enhanced through the interactive participation of multiple actors (Karim & Mitchell, 2000). The idiosyncratic social structures of a firm may thus be construed as its core rigidities (Leonard-Barton, 1992). It impairs recurring action patterns (Cohen et al., 1996) and results in organisational inertia (e.g. Hannan & Freeman, 1984; Rumelt, 1995). In essence, routines are socially complex, deep seated and interlocked (Jarzabkowski, 2004). They comprise of a social architecture that penetrates a firm’s communication conduits, information filters and problem-solving strategies, thereby

5.3  The Challenges of Dynamic Capabilities in Adaptation Processes

89

making it improbable for the firm to adopt new technologies (Hannan and Freeman 1984; Henderson & Clark, 1990; Jarzabkowski, 2004). The normative impacts of routines may be viewed as a cultural web (Johnson, 1987) and/or organisational memory (Walsh & Ungson, 1991). It provides deeply rooted repertoires, practices and rituals for action that are lasting sources of firm identity. These characteristics may be considered as idiosyncratic firm resources, with distinctive traits that are non-transferable and non-imitable and can be sources of competitive advantage (Eisenhardt & Martin, 2000). No organisation can hedge against all contingencies. Any investment into dynamic capabilities is to partially hedge against the old-­ fashioned (i.e. value-eroding) capability and can sometime result in sustainable advantage (Winter, 2003).

5.3.2  T  he Challenge of Solving Organisational Problems with Dynamic Capabilities In responding to environmental variables, managers need to make strategic choices. The choices available to decision-makers are many and may be complex (Doty, Huber, & Glick, 1993; Miles & Snow, 1978). The strategic choice(s) managers adopt are influenced by organisational resources, processes (dynamic capabilities) and structures (Eisenhardt & Martin, 2000; Miles & Snow, 1978; Miles, Snow, Meyer, & Coleman, 1978). Although these choices are many and complex, they are broadly categorised as three major adaptive problems (Miles & Snow, 1978). They are entrepreneurial problem, engineering problem and administrative problem. Managers (particularly those of matured firms) must proffer solutions to these adaptation problems concurrently in order to achieve superior performance (Doty et al., 1993; Frishammar, 2006; Miles & Snow, 1978). The entrepreneurial [or business] problem is inherent in all organisations. It is particularly observable in new or fast-growing organisations and those that have just overcome a major disaster. Entrepreneurial problem differs per category of organisation age. For instance, a new organisation priority is to transform an entrepreneurial idea into a definite organisational domain, i.e. a precise good or service and a market niche. For a growing firm, the challenge could be to modify its existing products/services and markets vis-a-vis its available human and material resources (Doty et al., 1993; Miles & Snow, 1978). In any organisation, solution to the entrepreneurial challenges is measured by managers’ acceptance of a certain—product/ service—market domain; this acceptance is obvious when managers resolve to accomplish objectives related to the domain (Miles & Snow, 1978). The entrepreneurial functions are primarily decision-makers’ responsibilities. Middle-level managers and other employees may spot new opportunity and initiate a drive to kick-start the process of needed entrepreneurial solution(s). Further to entrepreneurial challenge is engineering problem—this problem entails developing a system that  activates the administrative solution into the business/entrepreneur problem

90

5  Dynamic Capabilities: Drivers of Organisational Adaptations

(Doty et al., 1993). The formation of each system requires management to select suitable technology for manufacturing and distribution of products/services. Administrative problem entails lessening uncertainty in the organisational restructuring and stabilising activities that successfully solved problems organisation encountered in the course of solving entrepreneurial and engineering problems. It also involves constructing and implementing processes that enable the organisation to continue evolving (Miles & Snow, 1978). Since firm environment is continuously changing, firm must of necessity devise means of modifying its structure and processes to accommodate the changes. Strategic management refers to the process of continuously adapting to the changes in a firm’s environment (Schendel & Hofer, 1979), and firm adapts to changes in its environments in several ways; these are referred to as modes of adaptations (Chakravarthy, 1982).

5.4  Modes of Organisational Adaptations Three principal states (modes) of organisational adaptations emerge from interplay of organisational variables (resources, structures and functions) and environment determinisms (Chakravarthy, 1982). The three identified states are (1) unstable state, (2) stable state and (3) neutral state. Each mode of adaptation exemplifies adaptation state occurring within an organisation at a point in time. For ease of understanding, these states are individually discussed below.

5.4.1  Unstable Mode Organisations in this mode/state are the most vulnerable to changes in their environments. They are highly susceptible to changes in their environments (Chakravarthy, 1982). Decision-makers in these organisations are predominantly bothered about the fragility of the organisational adaptation; hence, they are constantly devising new buffering measures to keep their organisations afloat (Chakravarthy, 1982; Miles & Snow, 1978). Organisations in unstable state of adaptation may achieve good financial performance in the short term, but their long term’s sustainability is extremely limited, and thus they remain vulnerable. Since they are continuously buffering themselves against changes in their business environments, these organisations are often referred to as ‘defenders’ (Miles & Snow, 1978). Such organisations are characterised with rare or limited major adjustments in their firms’ technologies and operating models/structures. They also have limited product/service—market niches. The principal means these organisations ensure market stability is through chains of measures and decisions that minimise organisations from interacting with their business environments. These organisations are said to exist by discounting changes in their business environments (Miles & Snow, 1978). They are only able to better fit to tomorrow’s environmental uncertainties to

5.4  Modes of Organisational Adaptations

91

the extent that such uncertainties are similar to those of today. These organisations have the least immunity from environmental changes (Chakravarthy, 1982; Miles & Cameron, 1977; Miles & Snow, 1978).

5.4.2  Stable Mode Firms in this state are only vulnerable to certain environmental changes. These firms are able to react to changes in their environments and also adapt to the dictates of their environments. Although rather than buffering they are exposed to environmental changes, these firms still dither in response to environmental changes, and their responses are markedly minimal. These firms survive through eclectic market exploration techniques that enable them to mimic the best products/services their competitors offered (Chakravarthy, 1982). Owing to their characteristic nature, these firms are often referred to as analysers (Miles & Snow, 1978).

5.4.3  Neutral Mode Organisations in this state are the least vulnerable to changes in their environments, and hence they are the highest immune (Chakravarthy, 1982). They are able to (1) anticipate changes in their business environments either by embarking on advanced organisational restructuring or by preventing the occurrence of environmental dictates, (2) ‘weather’ the threats posed by changes in their environments and (3) adapt the environments to their organisational preferred goals and operating modes (Miles & Snow, 1978). These firms are able to do these by investing in the requisite firms’ adaptive capabilities. They are known to be constantly probing their environments for market opportunities (Chakravarthy, 1982). They achieve these by usually creating changes in their business environments to which their peers [competitors] must respond to. They are often referred to as ‘prospectors’ (Miles & Snow, 1978). These companies are by their nature almost immune from the dictates of their environment since they are constantly abreast with the changes in the environments (Chakravarthy, 1982; Miles & Cameron, 1977). Summarily, these three niches represent a hierarchical survival state an organisation can be based on the degree of environmental complexity the firm can handle. The more environmental complexity a firm can handle, the brighter the probability of its term survival and hence the higher is its adaptation level (Chakravarthy, 1982). The above-discussed three states of organisational adaptation are validated means by which organisations may survive in their business environments, if the decision-­ makers choose to adopt any of these adaptation modes according to the organisational design. It is certain that an organisation will achieve at least a measure of survival and may be an effective competitor in a given industry over a considerable time frame (Chakravarthy, 1982; Miles & Snow, 1978). While every organisation

92

5  Dynamic Capabilities: Drivers of Organisational Adaptations

should endeavour to prefer neutral adaptation state, it is understood that this may not be feasible considering that organisational adaptation state is predicated on (1) the resources at the firm disposal which determines its adaptive capabilities and (2) the firm’s management process, i.e. the process of adaptation within the firm. This also determines the state of adaptation a firm seeks to attain. In essence the man and material resources that an organisation possesses determine its state of adaptation (Chakravarthy, 1982; Miles & Cameron, 1977; Miles & Snow, 1978).

5.5  Discussion and Conclusion on Dynamic Capabilities Dynamic capabilities can be created from various starting points and along different paths in different contexts across the firm. Dynamic capabilities assume different function in different market situations. Firm dynamic capabilities reflect the integration of individuals’ specialised knowledge in the organisation. Knowledge exists in specialised form among individual firm members. Repeated practice or routines enhance the creation of firm dynamic capabilities. Knowledge has been implicated as being central to the development of firm dynamic capabilities. It is a fundamental resource of the firm. The man and material resources that an organisation possesses influence its state of adaptation.

Key Points for Practitioners • Dynamic capabilities enhance the successful development of flexible integration across multiple knowledge bases within the firm. • Dynamic capabilities are equifinal in nature; i.e. they can be developed from various starting nodes and along varying paths across the firm processes. • A firm may face the challenge of recursiveness with dynamic capabilities; pressing onwards to build firm adaptive capabilities may be helpful in managing the recursive challenge(s). • With dynamic capabilities, firms are better fit to their changing business environment. • Dynamic capabilities and other firm capabilities thrive best in firms that adopt new forms of structuring.

Examples of new [organisational] forms that enhance dynamic capabilities are the heterarchy, processual systems for cross-firm integration that enhance intra-firm knowledge networks and cellular form and network organisation. However, arise with dynamic capabilities when routines such as repeatedly recurring actions or sequences sometimes result in severe unsatisfactory, impeding

5.5  Discussion and Conclusion on Dynamic Capabilities

93

performance particularly when they are automatically channelled onto inappropriate contexts (Cohen & Bacdayan, 1994).

Recommendation for Future Research • Research in social sciences is increasingly growing interdisciplinary; a research agenda that draws together possible complementary features from a combination of perspectives and their implications may further our understanding of dynamic capabilities. • Further research into dynamic capabilities of the firm, inquiry into processes associated with adaptive capability building and identifying the multidimensional nature of organisational adaptations will further enhance our understanding of this concept and its relationships to firm survival, competitiveness and performances.

Three basic modes of organisational adaptations arise from interplay of organisational factors of resources, structures and functions and environment determinants. The three modes are unstable state, stable state and neutral state. Firms in unstable state continuously buffer themselves against changes in their business environments; these organisations are often called ‘defenders’. Firms in stable state survive through eclectic market exploration techniques that enable them to imitate the best products/services of their rivals; these firms are called ‘analysers’. Firms in neutral state are called ‘prospectors’. These firms are inherently immune from the dictates of their environment as they are constantly abreast with the changes in the environments (Miles & Snow, 1978). Each mode of adaptation exemplifies adaptation state occurring within an organisation at a point in time.

Summary of Key Points • No organisation can hedge against all contingencies. • Any investment into dynamic capabilities is to in part hedge against the ‘outdated/old-fashioned’ (i.e. value-eroding) capability and can result in sustainable advantage. • Dynamic capabilities have been implicated in the process of creating change within the firm and equally to elicit market change. • Dynamic capabilities facilitate interaction between micro- and macro-­ contexts and the ‘birth’ of firms’ new resource configurations. • Dynamic capabilities are considered on two distinct gauges, namely, evolutionary fitness and technical fitness.

94

5  Dynamic Capabilities: Drivers of Organisational Adaptations

Dynamic capabilities consist of four major processes, namely, reconfiguration, leveraging, learning and integration. Reconfiguration describes the transformation and recombination of firm’s assets and resources. Leveraging describes the extension of a resource by utilising it in a new area. Leveraging also reflects in the replication of system or process that is operating in one arm of a firm into another arm. Learning enables activities to be performed more effectively and efficiently and encourages reflection on success and failure. Integration describes firm’s ability to incorporate and coordinate its assets and resources, cumulating in the development of a new resource base (Ambrosini et al., 2009). Inherent in dynamic capabilities is the menace of recursiveness.

Chapter 6

Adaptations in Management Studies and Methodological Approaches in Adaptations

In the preceding chapters, we have examined the business environment, relevant theories, concepts, and their implications in organisational adaptations. We have also examined the inherent adaptive behaviour paradigms and dynamic capabilities including their roles in adaptation processes. This present chapter is divided into three sections. In Sect. 1, we examine forms and types of adaptations in various fields of management. Under Sect. 2, the relevance and suitability of content, context, process (CCP) and processual analysis in organisational adaptations are discussed. This section offers a general overview of content, context and process (CCP) framework, processual analysis and case study method. Lastly in Sect. 3, we review series of market dynamics in the photographic industry from 1960 to 2016 and how firms in the industry have managed to adapt to the changes particularly the challenge of technology discontinuity. Two reputable photographic firms, namely, Kodak and Fujifilm, are examined in the light of the earlier conceptualised adaptive behaviour paradigms. We based our analysis on Pettigrew’s content, context, process (CCP) framework; processual analysis; and case study method to show the application of these methods in practice.

6.1  G  eneral Overview of Adaptations in Management Studies The concept of adaptation is well documented in marketing, international business, information systems and other management literatures (e.g. Brennan & Turnbull, 1999; Dyer & Singh, 1998; Hallén, Johanson, & Seyed-Mohamed, 1991; Yalcin, Singh, Dwivedi, Apil, & Sayfullin, 2011). Some of the context adaptations that have been studied are adaptation in interfirm relationships (Schmidt, Tyler, & Brennan, 2007), adaptation of marketing mix elements in international markets (Powers & Loyka, 2010), sales process adaptation in business relationships (Viio & Grönroos, © The Author(s) 2018 O.E. Adegbite et al., Organisational Adaptations, SpringerBriefs in Business, DOI 10.1007/978-3-319-63510-1_6

95

96

6  Adaptations in Management Studies and Methodological Approaches in Adaptations

2014), human resource management (Debrah & George, 1997), and lean operations (Piercy & Rich, 2009). But there is no single or all-encompassing definition of this key concept. To set the scene of the chapter, it may be necessary to trace back and discuss triggers of adaptations. This is because adaptations in business management do not occur without triggers/stimulants. This could be elements from firm’s external or internal business environment or both. An understanding of the triggers of organisational adaptations may proffer an insight for managers for potential signposts that may require close scrutiny. These may be capable of influencing their perception and understanding the process of organisational adaptation in their firms. Such understanding of the reason to adapt may urge them to take inventory of their firms and be better prepared to gain competitive advantages through appropriate adaptations. Identified adaptation triggers include challenges posed by globalisation of businesses, explosion of and impact of information and communication technology (ICT) on businesses, diversity of employees (including diversity and gender and/or sociocultural sensitivity), ineffective and/or less value-adding sales processes (Viio & Grönroos, 2014) and challenges of managing diverse markets, growing demands for social and environmental responsibility of businesses and growing demands to managing business ethics or corporate governance among others (Cravens, 1995; Skalen & Edvardsson, 2016). The varying triggers of organisational adaptation may be one of the reasons why various researchers employed different approaches in explaining adaptation (Brennan & Turnbull, 1995; Canning, 1999; Holma, 2009). Also, adaptations can be influenced by contextual setting, it could occur within or between firms, and also they can be viewed as specific and non-transferable to other business relationships (e.g. Holma, 2009). The context in which specific adaptation occurs influences the type of adaptation model adopted. Pettigrew (1997) succinctly captured this by stating that ‘Context is not just a stimulus environment but a nested arrangement of structures and processes where the subjective interpretations of actors perceiving, learning and remembering help shape process’ (Pettigrew, 1997:341). Examples of these approaches are ‘illustrative adaptation’ (Hakansson, 1982), ‘inter-firm adaptation’ (Brennan & Turnbull, 1995), ‘reciprocity adaptation’ (Canning, 1999), ‘dyadic adaptation’ (Brennan, Turnbull, & Wilson, 2003), or ‘buyer-seller adaptation’ (Brennan & Turnbull, 1995) and ‘triadic adaptation’ (Holma, 2009). We construe that adaptation processes in organisations irrespective of the field of business management in most instances take the form of adaptive behaviour paradigms, dynamic capabilities, adaptive capabilities/capacities, forms of adaptations and types of adaptation. However, triggers of organisational adaptations and managerial cognitive abilities are necessary precursors to enacting and reconfiguring adaptive behaviour paradigms (e.g. Adner & Helfat, 2003; Helfat & Peteraf, 2015; Kaplan, Murray, & Henderson, 2003; Sharma, 2000). A pictorial diagram of these proposed underlying concepts can be seen in Fig.  6.1. These underlying concepts appear to find expression in forms and types of organisational adaptations. Depending on the contexts, organisations adopt diverse forms of adaptations in the process of adapting to their [both domestic and international] businesses. The figure below helps in throwing more light into the processes of adaptations in business management studies.

6.2 Adaptations in Business Relationships

97

Triggers of Organisational Adaptations

Managerial Cognitive abilities

Adaptive Behaviour Paradigms (MO, LO,EO, TO, SON, MAO, FRRO,SO, FSPA)

Dynamic capabilities

Adaptive capabiliities

Forms of Adaptations

Adaptation types

Fig. 6.1  The process of organisational adaptation. MO market orientation; EO entrepreneurial orientation, LO learning orientation; TO time orientation; SON strategic orientation; MNO managerial orientation; FRRO firm resources reconfiguration orientation; SO stakeholder orientation; FRPA firm structure and production architecture

Organisational adaptations take several forms and dimensions. It could be between two firms involved in business relationships. Generally, identified dimensions of adaptation are defined based on how they are formed or processed leading to their emergence. Examples include interfirm adaptation, triadic adaptation and adaptation through innovation. Further dimensions of organisational adaptations with their originating triggers are described in the table below (Table 6.1):

6.2  Adaptations in Business Relationships Adaptation in a business relationship is more pronounced where there is a significant difference between the relating parties. This implies that the amount of adaptation will be directly proportional to the differences existing between the relating parties (Gadde & Håkansson, 1993; Hagberg-Andersson, 2006). In business relationship, adaptation may be necessitated as one, or both counterparts are expected to make adjustments in order to increase the values/opportunities for both parties. However, counterparts in business relationship can have both collective and contrasting interests; each party can decide to cooperate or not. The various highlighted approaches (or definitions) of adaptations imply that adaptations take place at different levels, could be one-sided or reciprocal, could be defensive or offensive or could be proactive or reactive. Also, adaptations can be affected by contextual setting and changes, it could occur within or between firms, and also they can be viewed as specific and non-transferable to other business relationships. Considering sales/marketing involving buyer-seller for illustration purposes, various areas of adaptation that are applicable in sales firms and sales functions are listed in the table below. This is of particular interest considering the fact that many instances of adaptation processes are to meet buyer-seller value creation and appropriation specifications. There are similarities and differences in buyers [customers] and sellers’ areas of interests in adaptation. While buyers may be

98

6  Adaptations in Management Studies and Methodological Approaches in Adaptations

Table 6.1  Dimensions of organisational adaptations

1.

Dimensions of organisational adaptations Interfirm or dyadic adaptation or inter-organisational adaptation

2.

Triadic adaptation

3.

Reciprocity adaptation

4.

Uncertainty acclimatisation (in international business management)

5.

Business ecosystem

6.

Mutual adaptation

7.

Adaptation through innovations

Brief description …behavioural modifications, at the individual, group or corporate level, carried out by one organisation, which are initially designed to meet specific needs of one other organisation (Brennan & Turnbull, 1995:182) the strengthening of bonds between two organisations through changes in relevant relationship attributes (Knoppen & Christiaanse, 2007:218) Pro-active or reactive adjustments in actor bonds, resource ties, and activity links in triadic relationship settings that take into account the contextual setting and changes in it. …they are not transferable as such to other relationships (Holma, 2009:52) … modifications at the individual, group or corporate level which are carried out by one or both parties in an exchange relationship in order to suit new needs or conditions, and which are designed initially for that specific relationship (Canning, 1999:35) The adjustments—psychological and material—that individual entrepreneurs and firms make to the emerging perceived uncertainties of foreign operations, facilitating them to operate within the limiting effects of doubtfulness and hesitation that ensue from the sense of the unknown (Liesch, Welch, & Buckley, 2011a, 2011b) An extended system of mutually supportive organisations; communities of customers, suppliers, lead producers, and other stakeholders, financing, trade associations, standard bodies, labour unions, governmental and quasigovernmental institutions, and other interested parties. These communities come together in a partially intentional, highly self-organizing, and even somewhat accidental manner (Moore, 1998:168; Peltoniemi & Vuori, 2004) Mutual investment by two or more organisations to adapt to particular organisational needs by adjusting products and production to enable the conditions of the other It permits each to better fit together and improve the performance of each other (Hagberg-Andersson, 2006; Hallén et al., 1991; Mukherji & Francis, 2008) Innovation facilitates the survival and growth of firms by availing firms with new growth opportunities (Lawless & Anderson, 1996; Meeus & Oerlemans, 2000; Primc & Čater, 2015)

interested to observe selling firms to adapt their product and services to meet their peculiar value demand, selling firms may also expect buying firms to reciprocate by adapting their internal procurement specifications and payment process. If both parties agree and adjust their internal operations to suit each other’s terms of exchange, such process may result in mutual value creation. In this regard, sales, seller’s sales

6.3 Types of Adaptations in Business Relationships Table 6.2  Classification of interfirm adaptations

Customer adaptations Areas of interest Product Production process Production planning Payment terms Stockholding Organisation Information provision

99 Supplier adaptations Areas of interest Product Production process Production planning Payment terms Stocks and deliveries Organisational structure Information provision

Adapted from Brennan and Turnbull (1995:185)

functions, buyer’s buying process and other related functions in the process of value creation and appropriation play a vital role, and many instances of adaptation process take place through interactions of both parties (e.g. Skalen & Edvardsson, 2016; Cravens, 1995). Examples of buyers/sellers interfirm adaptation are listed in the table below (Table 6.2).

6.3  Types of Adaptations in Business Relationships Various scholars have studied and classified adaptations in different ways. Examples of such classifications are administrative, financial, knowledge, logistical and technical adaptations (Johanson & Mattson, 1987). Others are motivation, outcome and process adaptations (Brennan & Turnbull, 1996). For better understanding of process of adaptation in interfirm business relationships, Brennan and Turnbull (1995, 1996) further postulated ‘five metaphors’ of interfirm adaptations, namely, decision-­ making process, political process, social process (socialisation), investment process and evolutionary process. According to Brennan and Turnbull (1996), these process metaphors (of adaptation) complement each other. They are significant in buttressing the process of adaptation. Others are cultural adaptation (Fang, 2001) and presumptive adaptation (Szulanski & Jensen, 2006). Presumptive adaptation refers to how foreign firms adapt to their host environment. It is a significant adaptation as it intended to establish fit with the local environment. Szulanski and Jensen (2006) used the word ‘significant’ to connote the simultaneous modification of two or more components of the original organisational practice. The aforementioned types of adaptations reveal a detailed perspective of the process of adaptation in the buyer-­ seller relationship. A good place to examine the process of adaptation in organisational setting will be to identify causes/triggers of adaptations; this often emanates from the firm’s operating environment. These environmental triggers could vary from government regulation to differences in customers’ taste and preferences. A typical example of product adaptations is displayed in the diagram below (Table 6.3).

100

6  Adaptations in Management Studies and Methodological Approaches in Adaptations

Table 6.3  Examples of triggers of types and forms of adaptations Examples of triggers of organisational adaptations Changing customer value proposition(s) Varying customers’ taste and preferences Mounting competitive pressure Infrastructural lag/differences (technology/machinery) Market lag/evolving market demands Government regulation Interfirm cultural differences and/or conflicting business interests

Examples of possible adaptation types Presumptive adaptation Ideal adaptation

Examples of possible forms of adaptation Increased patronage/sales growth Expanded market penetration

Actual adaptation

Gain in competencies/capabilities Diversification

No or maladaptation

Compliance/increase propriety value Conflict management Lean manufacturing processes; merger and acquisition

Table developed based on reviewed literature The variables in each column are not in any particular order

6.4  T  owards a Synthesised Methodology in Organisational Adaptations This section presents an overview of content, context and process (CCP) framework. We also examine the relevance and suitability of content, context, process (CCP) and processual analysis and case study method in organisational adaptations. The synthesised methodology forms a comprehensive approach of investigating the existence of adaptive behaviour paradigms in the selected case study. By adopting the synthesised methodological approach, we highlight the relevance of the paradigms in adaptation process. The overview and components of the methodological approach are discussed in the following sections.

6.4.1  Overview of CCP Framework The CCP framework is the foundation for contextualist approach to the study of organisations (Sminia & De Rond, 2012). Content refers to the specific areas of transformation under investigation. For instance, the firm may be pursuing to change products, people (i.e. manpower), corporate culture, technology and/or geographical location. The content of any strategic transformation is principally a creation of a legitimisation process configured by gross changes in the outer context of the firm and by political and cultural influences within the firm, though commonly articulated in analytical or rational terms (Pettigrew, 2012). The context element in the CCP framework refers to the antecedent circumstances of transformation, i.e. the internal structure, cultural and political context within which leadership occurs, as

6.4 Towards a Synthesised Methodology in Organisational Adaptations

101

well as wide-ranging characteristics of the outer context of the firm from which much of the legitimacy for modification originated. And lastly the process of transformation refers to the actions, reactions and interactions from sundry stakeholders as they act to move the firm from its current to its future state (Pettigrew, 1987). Summarily, Pettigrew’s triangle is about investigating the ‘what’ (content), the ‘why’ (i.e. analysis of inner and outer context) and the ‘how’ (i.e. processual analysis) (Pettigrew, 1987, 2012; Sminia & De Rond, 2012). The contextual perspective has been used frequently in analysing management-­ environmental variable issues like information technology-based change and information system (IS) inquiries (Stockdale & Standing, 2006; Huerta & Sanchez, 1999). These are complex adaptive issues relating to organisational adaptations. Both information technology-based change and information system (IS) ­transformation entail lots of theories and perspectives that are expressed through series of interaction in the process of transformation. Such phenomenon requires the content, context and process framework to analyse. For instance, Stockdale and Standing (2006) posited that the adoption of the context, content and process framework to IS analysis emanates from the fact that the concepts are broad enough to accommodate the myriad ideas and arguments in this well-documented field, while still providing parameters for reviewing them (Stockdale and Standing 2006:1091). The multifaceted levels of organisational adaptation triggered by elements in business environment brought by the interplay of diverse variables are better analysed using contextual framework. It is the appropriate lens that can offer a holistic perspective to comprehend the nature of change and analyse the dynamic interactions between the organisational adaptation variables (Child & Smith, 1987; Dawson, 1994). The distinctive characteristic of dynamic business environment is that it impacts on a continuous complex process where change is unpredictable, and conventional approaches to manage it are therefore suboptimal (Orlikowski, 1996).

6.4.2  Process and Processual Analysis Process may emanate from a series of individual and communal events, actions and activities emerging over time in context (Pettigrew, 1997; Van de Ven, 1992). The mechanism employed in executing adaptation can be a significant determinant of an organisation’s responsiveness to prevailing influences (Armenakis & Bedeian, 1999). On the other hand, processual analysis aims to dissect and describe mammoth of distinctions and complexities beneath organisational process—in this case adaptation. Processual analysis involves explaining, analysing and unravelling the what, why and how of some sequence of individual and collective actions, where actions trigger processes and processes cannot be described by mere mentioning of individual or communal agency; this is because actions are ingrained in contexts which limit their information, intuition and impact (Pettigrew, 1997). This implies that processual analysis places emphasis on interchange between agents and contexts occurring over time and cumulatively. This is an important point that explains the idiosyncratic feature of adaptation process.

102

6  Adaptations in Management Studies and Methodological Approaches in Adaptations

6.5  Processual Analysis Processual analysis recognises that contexts are forming and are formed. Also actors are producers and products (Sztompka, 1991). Hence the dual attribute of actors (agents) and contexts must consistently be recognised (Giddens, 1979). Processual analysis brings to fore the fact that the deed of the past is always shaping the unfolding future. And ‘what happens, how it happens, why it happens, what results it brings about is dependent on when it happens, the locations in the processual sequence, the rhythm of events characteristic for a given process’ (Pettigrew, 1997:339). According to Pettigrew (2012), there is no one best way of conducting process research in organisations. But the ‘innate’ guiding assumption for undertaking process research should be: 1. Embeddedness which implies investigating processes across various levels of analysis; at both inner and outer organisational contexts; 2. Temporal interconnectedness—insight into the sequence and torrent of event over time as evident in investigating processes in the past, present and future time; 3. A function for describing context and action which are inseparably connected. For instance, context is not just a motivating environment but a cluster nested hierarchy of structures and processes ‘where the subjective interpretations of actors perceiving, learning, and remembering help shape process’ (Pettigrew, 1997:341); 4. Processual research analysis should be about inquiring for an all-inclusive rather than linear explanations of process; and 5. The need to link process analysis to outcomes (Pettigrew, 1997). The above description of processual analysis underscores the centrality of time and history in any processual analysis. This implies that for processual researcher, events and sequence of events are vital building blocks but only building blocks. This explanation is germane because the intention of processual analyst is to generate a case study and not case archive. The case study goes farther than the case archive/history in suggesting a series of analytical purposes. Primarily there is an exploration for patterns in the process and probably some bold effort to compare the shape, character and occurrence of pattern in case A compared to case B.  This method permits us to actualise our attempt to find the fundamental mechanisms which constitute any patterning in the observed processes. These mechanisms may be seen in the components in the interactive domain induced by relationships between levels of process and context around the main stream of analysis. In any process inquiries, the untangling of these dynamics in this interactive domain constitutes one of the greatest inductive setbacks for process researchers and an area of intellectual debate which is as challenging as it is to accomplish and widely validated (Pettigrew, 1997). While some processes may be directional, linear, incremental and sometimes permanent, others may be drastic, nonlinear and transformational (Sztompka, 1993). In any event, openness to these likelihoods is a

6.5 Processual Analysis

103

vital scholarly prerequisite in process research (Pettigrew, 1997). Based on Sztompka (1993) and Pettigrew (1997), we propose that it will be more appropriate to have open-minded and pluralistic perspectives of the occurrences in the firm. This will place managers in vintage position in comprehending and responding appropriately to the challenges of organisational adaptation. A good model to achieve this is through the content, contexts and processes approach. This CCP framework provides a platform of linking process analysis to outcomes. According to Pettigrew (1997), the art of building outcome to process research design has various benefits. One major advantage is to examine how and why differences in context and process influence peculiarity in the outcomes observed across the comparative study. Also process research can generate sound knowledge of processes and outcomes. On the other hand, the outcome both simplifies and complicates the research by presenting a focal point—a centrepiece for the whole inquiry. Pettigrew (1987) conceptualises contextual factors to be both inner and outer. The inner context includes organisational strategy, structure, culture and management processes, while identified outer contexts are national economic, political context, social context and the perception and interpretation of actions in which the organisations operate in the national level. Pettigrew’s conceptualisation of context relates to organisational environments which are the aggregate of tangible and intangible factors that impact on the decision-making behaviours of individuals in the organisations (Duncan, 1972; Fahey & Narayanan, 1986; Frishammar, 2006; Rosenzweig & Singh, 1991). However, Buchanan (1991) and Buchanan and Boddy (1992) argue that contextual and processual model must take cognisance of how context not only moulds process but also affects the expectations placed on managers as variation in contexts across time requires different managerial skills and course of actions. Similarly, some management scholars find Pettigrew’s analysis inadequately contextual in that it is uncritical about the legitimacy of decision-makers (i.e. top managers) trying to control firm’s resources (e.g. Morgan & Sturdy, 2000; Willmott, 1997). In a similar vein, Caldwell (2005) thinks Pettigrew is insufficiently precise about the nature of agency. Despite a widely held belief that top managers seek their own interests in a process of organisational politics, they are also understood as strictly curtailed by contextual conditions (Sminia & De Rond, 2012). The argument therefore lies in where does agency commence and context finish? Furthermore, Caldwell argues that Pettigrew’s assertion of his work being practically relevant is undermined by his conclusion that top managers are confronted with processes that are largely indeterministic and thus place scathing limitations on the possibility to guide a process into a particular direction. In any event, the criticisms that trailed Pettigrew’s works help in keeping in very specific context Pettigrew’s (1987) contribution, namely, the literature on strategy formation; the unpredictable emerging developments, which together result in resources being allotted; strategic choices; and performance being achieved among others (Sminia & De Rond, 2012). More importantly Pettigrew’s findings reveal occurrences in organisations as social reality which is not in a steady state, i.e. it is a dynamic process that most often occurs as a moving target (e.g. Chakravarthy, 1982). A dynamic feature of process implies process in transition. Based on this view and on the assertion that adaptation process is not static, it will be

104

6  Adaptations in Management Studies and Methodological Approaches in Adaptations

more appropriate to hold a pluralistic mindset while studying adaptation in the firm. Equally, it is worth noting that organisational adaptations typifies consequences of human conducts and these conducts are continuously in a process of becoming. Despite the criticism of Pettigrew’s content, context and process framework, his conceptual model proves to be a modest ‘takeaway’ that succeeding generation of management scholars took full advantage of (Sminia & De Rond, 2012). The main point of Pettigrew’s work is that it helps in capturing ‘reality in flight’—a means of gaining insight into social reality in transit. The reality here is the organisational adaptation which in many instances is a moving target. However, the function of CCP framework may be complimented through case study analysis.

6.6  Case Study Method Case study analysis or method is a strategic qualitative research methodology. Case studies are vital in giving answers to ‘How?’ and ‘Why?’ research questions, and in this respect, it is appropriate for descriptive, exploratory or explanatory research (Rowley, 2002). This research method is applicable in research into contemporary events such as adaptations in organisations in which the relevant behaviour(s) cannot be schemed or predetermined. A typical case study research utilises set of evidence from diverse sources, such as documents, interviews, observation and vestiges. It goes farther than the variety of sources of evidence that might be obtainable in historical study. According to Eisenhardt (1989), case studies are ‘particularly well suited to new research areas or research areas for which existing theory seems inadequate. This type of work is highly complementary to incremental theory building from normal science research. The former is useful in early stages of research on a topic or when a fresh perspective is needed, whilst the latter is useful in later stages of knowledge’ (Eisenhardt, 1989:548–549). Case study is particularly relevant when dealing with complex real-life activities in great depth in which multiple sources of evidence were used. The search light is not about a study of the entire organisation but a focus on a specific issue. This is of significance where the researcher can spot cases with repertoire rich in information. It avails the researcher an avenue to gain a holistic view of series of events or a certain phenomenon. It also provides a platform for round perspective since evidences are inferred from many sources. Synthesising sundry skills for extricating data in case study research strengthens and confirms research findings. Another feature of case studies is that it can comprise single or multiple cases. Furthermore, case study also strengthens the processual analysis process in capturing the emergent and intrinsic features of life in organisations and flow (the movement or declining) of organisational activities, particularly in stances where rapid changes occur. Case study research combines diverse data collection sources such as archives, interviews, questionnaires and observations. The evidences obtained may be qualitative or quantitative. Results from case research should be validated by multiple evaluators and subject to independent evaluation.

6.7 Research Design

105

Case research is often criticised for its extensive time and effort demand. Unlike other methods, case research is known to be time and effort intensive. However, the research questions being addressed relates to the time and effort required. Case study research may be time- and effort-managed when researcher leverages and has access to the quality data source from the internet and through other medium of information communication technology. Also, the research method has been criticised as it is conventionally viewed as lacking in rigour and objectivity when compared with other social research methods (Johnston, Leach, & Liu, 1999). In handling these criticisms of case research, a systematic case methodology developed which can be beneficial for testing theory has been advocated (Eisenhardt 1989; Johnston et al., 1999). Fundamental to this confirmatory case method are three elements, namely, (1) the research must begin with propositions or hypotheses developed by theory, (2) the research design must be analytical and coherent and (3) the research outcomes or findings must be independently analysed. Using these central elements as guide, research projects can be structured around these factors, and as such, case study research becomes theory-based, logical, robust and more objective. The construction of case study research design can also be a vital tool in arriving at robust research findings. Relevance of case study research in business management studies has been identified (Perry, 1998; Pettigrew, 1997). According to previous research findings, case study research may have more impact on marketing managers than survey outcomes (Johnston et al., 1999). Case study is appropriate in investigating voyage to the realm of discovery. Beyond this feat, it can be effectively applied to test theory in complex environments. For instance, the context of business-to-business issue of concern to marketers take place in environments characterised by high levels of complexity. It is here that traditional methods struggle and the case study has the potential to aid research. Case study research can be based on synthesis of either quantitative or qualitative approaches (Eisenhardt, 1989; Rowley, 2002). Usually, case study uses multi-data sources including two or more of documents, first-hand in-depth observations and interviews (Rowley, 2002). We argue that considering the features of organisational adaptations, a synthesis of CCP model, processual analysis and case study method offers a robust base for understanding this concept.

6.7  Research Design A research design refers to the logic that relates the data to be sourced and the conclusions to be drawn to the preliminary questions of a study. It ascertains research coherence. It can be viewed as an action plan for transiting from the questions to conclusions. It should assure that there is a distinct grasp of what is to be achieved by the case study. This involves explaining the elementary components of the inquiry, such as research questions and propositions, acknowledging how validity

106

6  Adaptations in Management Studies and Methodological Approaches in Adaptations

and reliability can be substantiated and selecting a case study design (Rowley, 2002). A typical case study has the following components research design: 1 . The study’s questions 2. The study’s propositions 3. The study’s units of analysis 4. The logic linking the data to the propositions 5. The criteria for interpreting findings Designing research questions could be a daunting task; however, commencing with distinctly designed questions is valuable for all research inquiries (Rowley, 2002). One of the ways of designing distinct research questions is by focusing on relevant theories as incorporated in the literature. Relying on theoretical prototype is vital to the robust analysis of case study data. Based on this point, researchers and other interested professionals can generate research questions that are of broad interest and therefore might fully explore such in the context of the intended case study. In case of exploratory research type, research questions may yet to be formulated, but in any event, the purpose of the research needs to be distinctively defined. Both explanatory and descriptive studies need propositions. Formulated research questions need to be transcribed into propositions. Researcher may have to make an assumption and also rely on any prior evidence as to what they expect the findings of the research to be. With this in mind, the data collection and analysis can then be structured in order to support or reject the research propositions. Central to case study research is the unit of analysis. This can be event/events such as organisational adaptations or a business unit/group within the organisation, or the focus can be on the business executives. Although in some occasions, it might be challenging to spot the boundaries of the unit of analysis. It is important that the case study ask questions appropriate to the unit of analysis and/or any subunits if they exist. The boundaries of the unit of analysis are often defined by sources of evidence and collated evidence.

6.8  D  iscussion and Summary on CCP, Processual Analysis and Case Study Method This chapter has examined in great detail the synthesis of CCP, processual analysis and case study research method. Through this synthesised framework, we were able to reinforce the significance of holding a pluralistic view of the adaptation processes. This is particularly important owing to the dynamic nature of adaptation process. The combination of CCP and case study analysis provides theoretically sound and practically useful research tool for organisational adaptations. In any given scenario, detailed investigation into organisational adaptations should inquire the contexts, content and processes of transformation together with their interconnectedness through time. The time quality of a processual research is evident in relating processes to outcomes. Process research is a dexterous activity full of intuition, judgement and tacit knowledge.

6.10 Investigating Photographic Industry: A Synthesised Research Method

107

There is no one method of undertaking processual investigation. There exists difference between process and processual analysis. Process is defined as a series of individual and communal events, actions and activities emanating over time in context. The process adopted in change implementation can be a key factor in gauging an organisation’s responsiveness to prevailing influences. Conversely, processual analysis aims to dissect and describe mammoth of distinctions and complexities beneath organisational process—in this case, adaptation. Processual analysis centres on describing, analysing and untangling the what, why and how of some sequence of individual and collective actions. Case study research method is a strategic research methodology. The method is vital in giving answers to ‘How?’ and ‘Why?’ research questions, and in this respect, it is suitable for descriptive, exploratory or explanatory research. This research method is applicable in research into contemporary events such as adaptations in organisations in which the relevant behaviour(s) cannot be pre-planned. Case study research utilises series of evidences from diverse sources, such as archival evidences, documents, interviews, observation and vestiges. A rounded research in organisational adaptations may be based on the fit between content, contextual and process analyses than the character of an intended adjustment. This can be captured in case study research method.

6.9  C  CP and Case Study Analysis in Digitalisation of Photographic Industry In this section we review series of market dynamics in the photographic industry from 1960 to 2015 and how firms in the industry have managed to adapt to the changes particularly the challenge of technology discontinuity. Two reputable photographic firms, namely, Kodak and Fujifilm, are examined in the light of the earlier conceptualised adaptive behaviour paradigms. We based our analysis on Pettigrew’s content, context, and process (CCP) framework; processual analysis; and case study method to show the application of these methods in practice.

6.10  I nvestigating Photographic Industry: A Synthesised Research Method The case investigates occurrences in business environment in the photographic industry between 1960 and 1999 and between 1999 and 2016. Using the content, context and process (CCP) framework, processual analysis (Pettigrew, 1985a, 1985b, 1987, 2012) and case study research method (Eisenhardt, 1989; Johnston et al., 1999; Rowley, 2002), we turned search light on Kodak and Fujifilm. We relied on findings from Porter’s work—Porter (1983); business/market analysts’ comments in reputable articles and documented work of Fujifilm chairman—Komori;

108

6  Adaptations in Management Studies and Methodological Approaches in Adaptations

and other relevant data on events in photographic industries between the 1960s and 2016. The study findings were based on researchers’ observation vis-à-vis literature reviewed. We specifically examine the two photographic giants paying attention to the existence of adaptive behaviour paradigms in these firms and how it impacts on their survival during the period of technological discontinuity in the photographic industry. We begin by examining the photographic industry before the advent of technological discontinuity. This falls between 1960 and 1999; happenings in both Kodak and Fujifilm are thereafter discussed.

6.11  Photographic Industry 1960–1999 Early in the history of photographic industry, the business was categorised into three main markets, namely, the instant camera market, the home movie market and the photofinishing market (Porter, 1983). The prevailing photographic products and services were conventional amateur still films, cameras, photosensitised materials and processing. The leading contenders in the photographic industry were Kodak, DuPont’s, Konica, Agfa-Gevaert, Fujifilm (previously known as Fuji), Polaroid, Pavelle Corporation, Berkey Photo Inc., Ilford, Bell and Howells, Ciba, Turaphot, Konishiroku, Mitsubishi, General Aniline and Film—GAF Corporation—and 3M (Komori, 2015; Porter, 1983). Kodak was clearly the market leader standing tall far ahead of its rivals in market dominance, sales and revenue (USD). For instance, in 1963 Kodak total sales was $1.1 billion (USD) and Fujifilm was as tiny as $75 million (USD) (Komori, 2015). During this period the bases for competition in photography market were rivalry for market share and technology superiority (Porter, 1983). Among these players, competition was fierce in form of market dominance, price competition, sales volume and technological prowess. Kodak was regularly rated as one of the world’s five most valuable brands. In fact the company was described as the ‘Google’ and ‘Facebook’ of its days (The Economist, 2012). With huge profit margin, Kodak was seen as the industry giant owing to its enormous sales record, brand reputation and profit margins (Porter, 1983). Simply put, Kodak was the colossus of the photography industry (Komori, 2015).

6.12  K  odak: Its Beginning, Landmarks and Market Supremacy The Eastman Kodak Company or Kodak was founded in 1888 by George Eastman. The company was reputable for its motto You press the button, we do the rest and its ubiquitous yellow box (Porter, 1983). The company was instrumental to the transformation of photography from an alchemy-like activity in the late nineteenth century to one that became an integral part of people’s life (The World Street Journal, 2012). Photography has been an essential part of human culture. Kodak was a major

6.13 Kodak’s Winning (Adaptive) Strategies

109

force in entrenching this culture globally (Komori, 2015). The company was the foremost integrated photographic company (Komori, 2015; Morozov & Morris, 2009; Porter, 1983). At a time, the firm was so fully integrated that it has its own stockyard of photographic material so as to control the material quality of its photographic needs (Porter, 1983). The company was active in various markets other than those of traditional amateur still films, cameras and processing. For instance, in 1975, Kodak’s Eastman Chemical Division recorded $1 billion (USD) in sales. The division was saddled with selling a wide variety of chemicals, fibres and plastics to industrial clients (Porter, 1983). Kodak brand was so successful that in 1976 it accounted for 85% of camera and 90% of photographic film sales in the USA. The company was universally the market leader in each market in which it competed (The Economist, 2012; Porter, 1983). The company’s revenues climaxed at approximately $16 billion (USD) in 1996, and in 1999 its profits stood at $2.6 billion (USD) (The Economist, 2012; The World Street Journal, 2012). At a time, Kodak’s film and camera business alone was ten times the size of Bell and Howell’s total sales (Porter, 1983). In 1975 Kodak’s photographic sales figure was three times those of Agfa. Kodak’s enviable sales and financial performance undisputedly placed her as the market leader in photographic industry. At year ended 1975, it was documented that Kodak had sold over 60 million Instamatic cameras in just little more than a decade. Instamatic camera is one of Kodak’s range of successful products. During this same period, all Kodak’s competitors combined had sold nearly ten million Instamatic-type cameras (Porter, 1983). Kodak’s performance was attributed to its product superiority, robust market penetration and sound distribution capabilities (Morozov & Morris, 2009; Porter, 1983).

6.13  Kodak’s Winning (Adaptive) Strategies Kodak’s market dominance was as a result of its leadership positioning in film technology and quality control (Komori, 2015; Porter, 1983). On periodic basis, Kodak’s high-quality film became even better. At every point in time when competitors aimed to offer superior film quality to Kodak, they were unsuccessful as Kodak was able to offer even better quality film, and as such Kodak was able to improve on its previous successes. There was an instance when DuPont and Bell and Howell partnered in joint venture to produce better superior colour film. The joint venture cost them over several million US dollars. Kodak responded to the threat by launching even better quality film so much that Bell and Howell/DuPont’s product was withdrawn before it ever reached the market (Porter, 1983). Also at other time when competitors tried to increase their market share by slightly lowering their prices, consumers responded negatively. They perceived price reduction as offering of less quality product and were unwilling to accept such under any disguise. Kodak’s offering was synonymous with quality, and consumers

110

6  Adaptations in Management Studies and Methodological Approaches in Adaptations

were willing to pay for it (Porter, 1983). Kodak’s market dominance resulted in various antitrust legal suits and criticisms from its competitors. To overcome these business challenges, Kodak willingly took a business decision to license its systems. This decision was rewarded with three major advantages. Firstly, it reduced Kodak’s exposure to antitrust suits. Secondly, the licensing positively upshot the number of cameras sold in the market that could use Kodak’s enormously profitable film. The second advantage immensely helped in eliminating almost all (except two) of Kodak’s film sales rivals. Thirdly, it further helped spread the brand reputation: Kodak was synonymous with photography. In 1963 Kodak introduced ‘Instamatic’ cameras that captured the amateur photographic market. The company also introduced film and line of sound movie cameras. At the heart of Kodak’s amateur photographic was the ‘systems’ technology. It was a distinct format designed in a cartridge usable only in cameras. The Instamatic camera was produced specifically for that design. The market reacted positively with huge patronage of the brand (Porter, 1983). This was down to Kodak strategy of grounded advertisement and huge multichannel distribution strategy. On the launched day, the product was simultaneously available in 147 countries, was accessed by 75,000 retailers and was advertised in 8 different languages. The company was able to segment and target different consumer groups with availability of five different models of the camera with price ranging from $20 to $100 (USD). Kodak successfully launched the camera as ten million Instamatic camera units were sold within the first 26  months of its launch. Between 1963 and 1975, the company continuously launched new products with marked improvements on its previous offerings and was rewarded with impressive market share (Porter, 1983). Furthermore, Kodak attained superior sales and profit performance by wholly manufacturing its own film and camera products in-house unlike some of its competitors. By this business model, Kodak recorded approximately 70% profit margin on these items, while Polaroid recorded gross pre-tax profit of 45% as it subcontracted its films and cameras (Porter, 1983). In the 1960s, Kodak also gained from globalisation by selling its products in other countries outside the USA. The company achieved this feat by exporting photosensitive materials to countries like Japan. Kodak penetrated Japanese market through liberalised trading and lowered import/custom duties (Komori, 2015).

6.14  Kodak’s Waning Strategies and Market Dominance In 1976, Kodak’s market dominance began to experience real threat from Fuji a Japanese company. Fuji (also known as Fujifilm) encroached on Kodak’s traditional market territory by offering related quality products and processing at 10–20% below Kodak’s selling price (Komori, 2015; Porter, 1983). The initial strategies of high-quality high price and frequent improved product launch were waning so much that by the early 1980s, Fujifilm emerged as a key competitor to Kodak in the photographic industry. In fact by the late 1970s, Fujifilm had superior technology in

6.15 Fujifilm’s Route to Market Survival and Superior Firm Performance

111

almost all of Kodak’s film categories (Komori, 2015). Fujifilm pioneered high-­ speed negative photographic film. With this singular innovation, Fujifilm surpassed Kodak in photographic film technology. And from the 1980s onwards, Fujifilm began to expand through innovative products and lean manufacturing processes and by selling its quality products in Western countries at cheaper prices compared to Kodak’s. From then on, the company continuously competes fiercely with Kodak for market share. See further discussion in Kodak adaptive dilemma.

6.15  F  ujifilm’s Route to Market Survival and Superior Firm Performance Fujifilm was founded in 1934. Fujifilm was able to expand its business scope by leveraging on its photographic technology. The company track history of such capability was of immense advantage as Fujifilm leveraged on its photographic technology to develop audiotapes, videotapes and computer memory tape (Komori, 2015). The invasion of Japanese photographic market by Kodak makes it mandatory for Fujifilm to committedly develop photographic film products that could compete in the global market. The company also lessened its production cost by adopting lean manufacturing processes (Komori, 2015). Fujifilm also tried to survive the market by strategically planning to penetrate new fields of enterprise. The company pursues this strategy by establishing a brand new business unit called the Industrial and Products Division. In retrospect, it was the graphic arts-related business under the Industrial and Products Division that later contributed immensely to the survival and thriving of the company (Komori, 2015). Fujifilm leveraged on its landmark discovery of high-speed negative photographic film by aggressively developing its global manufacturing base and sales networks. The company pursued this by competing in every nook and cranny where Kodak trades. Furthermore, during the 1984 Olympics in Los Angeles, Fujifilm won the sponsorship deal that supplied the official film, after Kodak dithered the opportunity. The opportunity helped Fujifilm’s notably cheaper film encroach Kodak’s home market dominance (Komori, 2015; The Economist, 2012). Kodak was slow to act, the management believed they had ‘perfect products’ and were sold out to the mindset of ‘make it, launch it, and fit it’ (The Economist, 2012). By this laudable feat and through similar ways, Fujifilm was able to boost its market penetration and establish itself as a truly global brand (Komori, 2015). Kodak’s undoing was Fujifilm’s gain. By 1988, Fujifilm had built a factory in the USA and continue to grow its market share in America and Europe. The company began to assume superior competitive status in the photographic industry. During this period many Japanese brands in automobiles and other industries including photography were beginning to achieve competitive positions due to their technological prowess. This was particularly felt in the US market. Market players in the USA influenced and mounted international pressure against Japanese technological prowess through the instrumentality of the G5 countries. At the time the G5

112

6  Adaptations in Management Studies and Methodological Approaches in Adaptations

countries are the USA, France, Germany, the UK and Japan. The G5 called for adjustment in currency exchange rate. Japanese business executives perceived the move was to curtail the growing global dominance of Japanese companies. Other international pressures and political stratagem were directed at Fujifilm’s core business—photosensitive materials. For instance, through the Office of the United States Trade Representative, Kodak submitted a petition against Fujifilm. It was alleged that Japan uses exclusionary tactics in respect of photographic film and paper sealed Japanese market to competitors in favour of Fujifilm. The allegation was sufficiently contested at the World Trade Organisation with Fujifilm winning the trade scuffle. The victory was well received in the market circle resulting in sales increase and surge in Fujifilm’s global market share (Komori, 2015).

6.16  Photographic Industry 2000–2016 As earlier indicated, players in photographic industry fought for supremacy on the basis of technology superiority and market share, through price competition, quality control, political and technological manoeuvrings and sales volume. In other words, between 1960 and 1999, the content of organisational adaptations in the photographic film industry varies from technology superiority and market share through price competition, quality control, political and technological manoeuvrings and sales volume. At that time, employed strategies for survival and business success vary from the highest degree of technical expertise, maintenance of high technical standard for sustainable business, top-grade image quality, market penetration based on product superiority over competitors and competitive pricing strategies (Komori, 2015). However, a bigger threat of technological discontinuity in the photography industry in the late 1990s necessitates a fundamental change that swept the industry like a tsunami—a disruptive wind of change (Morozov & Morris, 2009). It was the craze for digitalised technology that challenged conventional photographic film industry (Komori, 2015; Morozov & Morris, 2009; The Economist, 2012). Although the photographic film recorded its peaks in 2000, by 2001 the global market for colour film suddenly plummeted. The peak of the photographic industry also coincided with Fujifilm’s rise as the global market leader in photographic film (Komori, 2015). Before year 2000, industry watchers and players saw the change in photographic technology coming, but the technological revolution of such gigantic and drastic surge caught many industry players unprepared. From year 2000 onwards, the photographic market began to shrink by 20–30% annually (Komori, 2015). It was a period of threat to market survival by the swift emergence of digital age and radical transformation in the photographic markets (Morozov & Morris, 2009). Indeed the disruptive technology of digital photography was very challenging for many conventional camera manufacturers (Komori, 2015; The Economist, 2012). For instance, in 2006 Konica Minolta withdrew completely from the photography industry – despite being the third-largest manufacturer of conventional photo film. Also, Nikon halted production of five models of traditional film cameras in phases,

6.17 Kodak’s Adaptive Dilemma

113

leaving only two film cameras in its product portfolio (Morozov & Morris, 2009). The companies’ business decisions were consequences of several digital product choices available in the market. Consumers had more product alternatives in the digital camera market as companies in the consumer electronics industry began offering digital cameras. Furthermore, consumers’ electronics companies like Samsung were formidable entrants into the digital photography industry. This was made possible by their strong brand awareness with consumers, enhanced by their extensive distribution channels and experience with many of the technologies involved in creating digital cameras. During this time the competitive position of various market players in the digital camera industry rose and fell as consumers demanded more features in the product offerings, improved technologies and lower prices (Morozov & Morris, 2009). The emergent of digital age revolutionised the conventional photographic industry (Komori, 2015). But the most revolutionary aspect has been the advent of the digital camera phone. Over 2.5 billion digital phone users presently exist with the number expected to surge to 6.1 billion users by 2020. The advent of mobile phone particularly smart phones has made digital photography a commonplace endeavour. With digital photography, there is almost no financial consequence for taking pictures, beyond charging the phone. It is also observed that people’s behaviour in public has changed thanks to digital cameras. Prior to this era, photography used to be more of elitist experience. It was expensive taking photos, but today the reality that photography could be inexpensive is thrilling. Presently photography is almost done effortlessly as a hobby and very cheap compared to some decades ago. This is even made easier because unlike conventional camera, digital camera has automated autofocus technology and excellent colour separation capability. Today, people take pictures with ease at events taking with them electronic photographic memories and have the opportunity of uploading them on various social media like Facebook, YouTube and Instagram, thereby exhibiting their photographic expertise and perhaps revealing presence at various social events. This trend of behaviour is also revolutionising the conventional media place. More importantly the promotion aspect of marketing mix can leverage on this revolution for firm advantages.

6.17  Kodak’s Adaptive Dilemma Kodak was very late into playing in the digital market, although the company was not late in investing in digital. In fact Kodak’s team of employees led by Steve Sasson invented the first digital camera in 1975. Though Kodak was liquid and employed very good employees who were excellent at what they do, the management did not comprehend nor attach futuristic importance to developing the digital camera. Kodak management’s lack of interest in investing in developing digital camera may be linked to various reasons like management complacency. Another

114

6  Adaptations in Management Studies and Methodological Approaches in Adaptations

reason might be the absence of existing market for the product although the product has promising prospects. Additionally, prior to the craze for digital technology, the company was running a traditional photographic business with gross margins between 60–70% which was difficult to let go. Also, the digital business comes with its attendant challenges. It necessitates a change in business model from design to processes of manufacturing to distribution. For Kodak this might imply changing the entire company’s business model. Even when the market for digital camera was emerging, for Kodak the new business model occasioned by digitalisation of photography was conceived to yield gross margin of 30% at best; as such it was particularly tough for Kodak to let go its traditional photographic film business (Komori, 2015; Morozov & Morris, 2009). Also there was a misconception that emanated from Kodak enviable success. The conception was that perhaps if Kodak does not migrate to digital, the imaging world will never transit into digital (Morozov & Morris, 2009). This misconception was fuelled by Kodak’s perceived foremost position in the photographic market. Kodak’s management were not objective in their market orientation analysis. They lost touch with the market to say the least as its photography business was fast declining. By 2002, Kodak’s efforts to shift its focus to consumer and revive its declining photography business faltered as the company in 2011 reported a third-quarter loss of $222 million (USD)—the ninth quarterly loss in 3  years. In fact by 2012 the company has posted losses in 6 of the last 7 years before finally filing for bankruptcy (The Independent, 2012). By 2011 Kodak barely had as many as one-tenth of 145,000 workers it employed in 1988 (The Economist, 2012). Kodak’s shares fell by more than 80% in 2011, partly because the company struggled to meet pension obligations for its employees (The Independent, 2012). Kodak’s top managers never fully comprehend how the photographic market around them was changing. With the advent of digital age, a significant shift in mindset occurred in the market interpretations associated with cameras. For many consumers, digital cameras came to be seen as electronic gadgets rather than being identified as a piece of purely photographic equipment. The implications of this shift in mindset were huge on Kodak. It upturned not only the product perception but channel of distribution. For instance, with digital appliances, new market players like Samsung and Sony were able to sideline one of Kodak’s main strengths—its distribution network. Unlike the pre-advent of the digital era, digital cameras became available in electronic retail stores next to other electronic gadgets. Kodak was now playing on Sony’s and other new entrants’ territory rather than its own. The shift by consumers to digital photography was coming much faster than expected, and market for Kodak’s old-fashioned film, papers and photofinishing businesses was declining. By the end of 2003, market analysts forecasted that digital cameras would begin to outsell film cameras for the first time in the USA. A new trend of technology has given the newcomers more power. Similarly, Kodak’s brand became synonymous with traditional photography rather than digital. Perhaps this partly explains why Chinese consumers did not buy Kodak’s traditional film cameras. Sales of traditional film cameras and film canisters plummeted drastically much more rapidly in Chinese market than had been

6.17 Kodak’s Adaptive Dilemma

115

anticipated. By 2006, more Chinese consumers owned camera phones than digital cameras (Morozov & Morris, 2009). Meanwhile Kodak had planned to improve on its dwindling market relevance by flooding Chinese market with its traditional film cameras. Kodak got the market orientation wrong. It failed to read emerging markets correctly. Also, digital technological innovations favoured consumer electronics companies rather than traditional camera makers in another important area—manufacturing. Electronics companies such as Sony have the capability to design and produce many of the integral components of digital cameras whereas traditional photography companies such as Kodak lacked these capabilities and had to patronise electronics companies to purchase them. From the foregoing, suffice to say that consumer electronics companies were formidable entrants into the digital photography market due to their robust brand awareness with consumers and expertise in various modern technologies involved in manufacturing digital cameras. Additionally, consumer electronics market players offered more choices to consumers in the digital camera market. For instance, Samsung, a consumer electronics company, is reputable for its strong position in the camera-phones segment, and Hewlett Packard is known for having solid grasp of printers and personal computers market segment. Furthermore, in segmented photographic market, there were significant differences in the purchasing preferences of male versus female consumers. Women’s preference centres on simplicity and desire for high-quality prints that could be shared with family and friends; Kodak met these needs for women with its point-­and-­shoot camera designs and the EasyShare docking station. Men seemed to prefer brands other than Kodak, because while men took lots of pictures, their motives had never been that of family archivists; they tend to take pictures that market analysts described as ‘transient’. Prior to the advent of digital camera, women were big players in the photographic market, but this changed with the advent of digital age. With the upturn in market situation, Kodak found itself in uncharted market place/territory rather than accepting the new business reality [of technology discontinuity including change in market demographic and demand] and adapting to it. The company kept attempting to regenerate the traditional photography of yesteryear, one based around sentimental images taken by women at family reunions and vacations. Digital technology disrupted Kodak’s market base as women were no longer the main customers; men were. For Kodak, the separation of the link between taking photographs and hardcopy prints was a serious blow (Morozov & Morris, 2009; The Economist, 2012). Kodak’s status as a valuable brand was threatened by the technological swing away from its cash cow business of conventional film and film processing. The switch by consumers to digital photography came much faster than expected and Kodak’s traditional film, papers and photofinishing businesses were nose-diving. Kodak needs to change its business model rather than just restructure. Although, Kodak was built on culture of innovation and change, the company did not profit [at the most critical time in its business life] from its obsessive innovations (Grant & Neupert, 2000; Kotter, 2012; Morozov & Morris, 2009). Did the company fail because it had run its course and fade away like an old photo after over 100 years of market dominance? Kodak failed to survive largely

116

6  Adaptations in Management Studies and Methodological Approaches in Adaptations

because Kodak’s top executive tried to use old technology to meet the challenge of the modern era of profoundly different technology (Christensen, 2011; The Economist, 2012). The company did not survive technology discontinuities struggle of its business environment. Kodak failed to take decisive action to tackle headlong the inevitable challenge of rapid transformation in the digitisation of the photographic industry (Kotter, 2012). Interestingly, at Kodak some employees, i.e. passionate innovators, were abreast of the occurring changes in photographic market and need to embrace new technology. For instance, a former Kodak executive Larry Matteson wrote a report in 1979 informing Kodak management how various market segments would migrate from film to digital. The report explained how a gradual shift will culminate into huge market shift starting with government reconnaissance and then professional photography year 2010. It was a detailed and fairly accurate with few years missed (The Economist, 2012). Also it was ironic that Kodak was the first to develop digital camera in 1975 by one of its engineers, Steve Sasson, but Kodak’s top managers consider going digital meant killing film—wrecking the company’s golden egg to make way for the new. Mr. Sasson and his colleagues were met with blank faces when they unveiled their device to Kodak’s bosses (The Independent, 2012). Even when Kodak was producing digital cameras, the company stuck to its ‘razor blade’ business model —Kodak sold cheap cameras and relied on customers purchasing loads of expensive film. Kodak’s business model was similar to Gillette which profits are made from selling blades and not razors. Unfortunately, the model did not work with digital cameras. Kodak’s hefty investment in digital cameras only lasted a few years, and the business was ruined by the advent of camera phones (The Economist, 2012). Digital technology was such a fundamentally different technology that emerged; there was no way to use the old technology to meet the new technological challenge. Kodak took easy route by competing in one market rather than taking the harder route of developing new products and new businesses. The inconsistency in leadership at Kodak did not help matter (Grant & Neupert, 2000; Morozov & Morris, 2009). The inconsistency in leadership translated into frequent change in strategy with each of diverse new chief executives (Grant & Neupert, 2000; The Economist, 2012). Many of these executives were appointed outside the firm. Whereas, at Fujifilm there was leadership consistency which was constantly appointed from within the firm. This way there was no cultural conflict and strategy summersault as the Chief Executive is a ‘product’ and ambassador of the company’s valued culture. What happened to Kodak can be summarised as a failing that recurrently expresses itself in numerous companies across the globe. They lost touch with their customers (Sarkar, 2013; The Independent; The Economist, 2012). Losing touch with the customer is the genesis of failing to adapt to market dynamics. In 2013, Kodak re-emerged predominantly as a printing company going bankrupt in 2012. In 2015 the company launched its first mobile phone Kodak IM5 in partnership with Bullitt Group using Kodak branding. In 2016, the company also released its second phone named Kodak Ektra. The phone promises lovers of photography world of creative opportunities. Kodak phones were primarily designed with emphasis on the camera and not the phone. The Kodak Ektra camera was first released in 1941 as

6.18 The Adaptive Behaviour Paradigms Analytical Framework

117

an iconic rangefinder. It seems the company intend to leverage on its founding photographic capability and also aim to target photography-centric consumers and those in photographic-related profession. However, industry analysts are watching how the company phone products will perform in an increasingly maturing smartphone market (CNBC, 2016). Will the company catch up with the market leaders in the digital technology market place by leveraging on its rich history in imaging technology? In all, Kodak’s performance indicates that the company is resurging; however, how fast and/or how [if possible] soon will the Kodak brand regain its competitive position among leading competitors? The answer partly lies not only in its ability to reconfigure its core capabilities but also agility to turn the market tide to its advantage.

6.18  T  he Adaptive Behaviour Paradigms Analytical Framework This section seeks to evaluate and test the validity of the proposed adaptive behaviour paradigms. The primary assumption here is that there are series of theories and concepts interplaying at any given organisational context. Being an adaptive complex system, organisation devises mechanisms of surviving and achieving competitive advantage. These mechanisms include organisational development of adaptive behaviour paradigms. The development of these adaptive paradigms is premised on the condition that organisation is led by transformational leaders that drives the emergent of these paradigms in their firms. Absence of transformation leadership in firms may impair development of the needed adaptive mechanism to compete competitively. In testing the proposed adaptive behaviour paradigms, we developed an adaptive behaviour analytical framework. The analytical framework was developed using Pettigrew’s processual analysis as a guide. In the case of Kodak and Fujifilm, we analysed the actors, actions of leaders of these two companies and their organisations in the context of technology discontinuity—the digitisation of the photographic industry. We did this by analysing what happens, how it happens and why it happens. The consequences of what happens were predicated on when it occurs including the pattern of events. The pattern of emerged events is a significant characteristic of the process of event. With this in mind, we test for the presence/absence of adaptive behaviour paradigms in chains of events that occurred in Kodak and Fujifilm prior to, during and shortly after the challenge of technology discontinuity. We represent the presence of adaptive behaviour paradigm with positive sign (+), while the absence of it is denoted by a negative sign (−). The analytical framework is presented as follows (Table 6.4): The above developed adaptive behaviour analytical framework is applied in evaluating the adaptive behaviour paradigms of both Kodak and Fujifilm (Table 6.5). In context analysis using the above framework, different shades of probabilities are possible in each paradigm to arrive at a conclusion. That is, it may not be always clear-cut to record +ve or –ve in every context in which each paradigm is being examined, but the overarching feature(s) of the paradigm and pattern of events/ actions in the company under study may be a useful guide. This implies that to

118

6  Adaptations in Management Studies and Methodological Approaches in Adaptations

Table 6.4  Adaptive behaviour paradigms analytical framework

Adaptive behaviour paradigm Market orientation (MO)

Entrepreneurial orientation (EO)

Managerial orientation (MON)

Key elements Evidence of how the firm is doing something differently or developing novel response to market dynamics. Evidence of firm’s flexibility as a function of a quality market orientation. Such flexibility creates value when it results in desirable outcomes of decisions Evidence of market orientation should be existence of three key components: (1) information gathering, (2) dissemination and (3) responsiveness However, every organisation has varied degree of market orientation. Market orientation should be positively associated with firm superior performance in areas such as sales growth, new-product successfulness and profitability Evidence of proactive competitive behaviour that embodies values which facilitate the development of new businesses within the existing business and/or the rejuvenation ongoing businesses that need modification Evidence of firm’s ability to leverage on its workforce innovative strengths Evidence that managers have sociotechnical view that takes cognisant of links between technical, social, managerial, strategic and environmental requirements needed for effective management of firm resources Evidence that top managers are making effort to form agreements or ‘alignments’ between diverse systems in order to ascertain and eliminate probable dysfunctions in the firm Evidence that management is aware of prevailing market dynamic demands that demand balancing and maintaining firm internal harmony and adapt to environmental influences While it is given that no one best method of managing exists, the most suitable style depends on the type of task environment; firm must strive to achieve alignments and ‘good fits’

Expected status in a firm +

Actual status in the firm of inquiry

+

(continued)

6.18 The Adaptive Behaviour Paradigms Analytical Framework

119

Table 6.4 (continued)

Adaptive behaviour paradigm Time orientation (TO)

Stakeholders’ orientation (SON)

Learning orientation (LO)

Strategic orientation (SO)

Key elements Evidence of developing organisational wide agility that empowers an organisation to adapt to its business dynamics in real time and to fast-track ‘time-to-market, time-to-­ decision and time-to-response’ Such should reflect itself in situations where urgency of action is required to take advantage of momentary and/or timely opportunity in business environment Evidence that firm is aware of and scans its market, its strengths and weaknesses and its competitors and other stakeholders. For the purpose of identifying and exploring capabilities from key stakeholders Aimed at leveraging and acquiring important capabilities through collaborative efforts and networking management. Firm would need to act cautiously and weigh the benefit of such collaboration with its associated disadvantages Evidence of discontinuous innovation and the advancement of new knowledge in the organisation for superior performance Evidence of continuous development via devising of situations/contexts. Because it is most likely that the pace of business change will increase markedly in the coming years and emphasis should be placed on the speed and quality of adaptive learning as a strategic imperative variable in a learning-oriented firm Evidence that management seeks to ascertain the organisation’s ‘whole’ objective. This overall strategy is often embedded sub-­ strategies—corporate, business and operation. The overall firm strategy should be linear, adaptive and interpretive in nature

Expected status in a firm +

Actual status in the firm of inquiry

+

+

+

(continued)

120

6  Adaptations in Management Studies and Methodological Approaches in Adaptations

Table 6.4 (continued)

Adaptive behaviour paradigm Firm’s structure and production architecture (FSPA)

Firm resources and reconfiguration orientation (FRRO)

Key elements Evidence of strategic and structural form firm deploys that is contingent upon the environment in which firm operates. Evidence of superior organisational performance as an outcome that firm achieves fit between its structural form and firm’s environment. This is central to contingency theory of the firm Evidence of a flexible organisational form that is proactive to the prevailing market dynamic in which the firm operates. Such organisational form must be aligned and function in tandem with other adaptive behaviour paradigms Evidence of evolving organisation that exhibit lean organisation attributes and that emphasises proactive decision-making Evidence of presence of, development of, utilisation of and reconfiguration of firm dynamic capabilities needed to achieve adaptability. This is usually a reflection of firm’s implicit and explicit knowledge Dynamic capabilities are key building blocks of firm adaptive capacities. Such features of firm’s resourcefulness markedly influence firm’s competitive advantage capability

Expected status in a firm +

Actual status in the firm of inquiry

+

enhance robust analytical scrutiny of existence of adaptive behaviour paradigm in a given context, there is the need to understand salient features of each paradigm and identify the existence/absence of such in previous and ongoing activities, processes and procedures in the organisation of study. From such close observation, evidences of the presence of applicable adaptive behaviour paradigm might be captured.

6.19  D  iscussion and Conclusion on Adaptations in Management Studies and Methodological Approaches in Organisational Adaptations Adaptation cannot be isolated from its triggers. It occurs at various times in the life of the organisation and in different forms at various organisational levels including its product/service development. Adaptation triggers influence types and dimensions of adaptations. Triggers are important components of adaptation. Equally important is managerial cognition/perception of the need for adaptation.

6.19 Discussion and Conclusion on Adaptations in Management Studies…

121

Table 6.5  Kodak and Fujifilm on adaptive behaviour paradigms analytical framework

Adaptive behaviour paradigm Market orientation (MO)

Expected status in an adaptive firm +

Entrepreneurial orientation (EO)

+

Managerial orientation (MON)

+

Time orientation (TO)

+

Kodak Kodak got its market orientation wrong at the face of surging digitalisation of photographic (−)

There were evidences of huge innovative activities, but the leadership did not leverage on its workforce innovative strengths (−) There seems to be disconnection between the leadership and the middle managers particularly those involved in innovative tasks. Top managers were complacent (−)

The leadership was slow to react to the looming technology discontinuity (−)

Fujifilm Fujifilm approach the market cautiously by trying to understand the market dynamics as it unfolds. The company benefitted immensely by exploring other photographic-related markets while trying to protect its photographic heritage (+) EO was vertically and horizontally embraced. This contributes immensely to the company survival effort (+) The leadership was abreast of the market dynamics. There were evidences of communication and direction of purpose between the leadership and the led in Fujifilm. The leadership commenced organisation-­wide transformation campaign with clarity and sense of purpose and urgency (+) The company swung into action proactively and acted promptly to keep the business alive and adapt its core business technology to other profitable value offering before the deadly impact of technology discontinuity (+) (continued)

122

6  Adaptations in Management Studies and Methodological Approaches in Adaptations

Table 6.5 (continued)

Adaptive behaviour paradigm Stakeholders’ orientation (SON)

Expected status in an adaptive firm +

Learning orientation (LO)

+

Strategic orientation (SO)

+

Firm’s structure and production architecture (FSPA

+

Kodak Kodak collaborated with IBM for information systems development through outsourcing The company also collaborated with consumer electronic component manufacturers. The collaboration did not impact positively on the firm value adaptability drive Kodak’s core capabilities were further eroded through series of strategic alliances. The partnerships did not facilitate the company’s survival (−) The company leadership did not do much to promote learning culture. This was evident in the way the management handled Steve Sasson’s digital camera invention and Larry Matteson’s 1979 report in 1979 about future changes that will confront the photographic market (−) There were no consistencies in corporate, business and operational strategies owing frequent change in leadership (−)

The company practised mass organisation management style. Its low cadre employees were not required to be problem-solvers. Highly structured hierarchy with several vertical chains of command, the structural type and the decision-making process were complex and largely reactive (−)

Fujifilm Fujifilm reconfigured its core capabilities into photographic-related business ventures. While the firm has control on its newly rejuvenated core capabilities, Fujifilm identified and partnered with suitable stakeholders necessary for the firm’s survival The company also acquired other firms like IP Labs GmbH, a German online photo service system developer (Komori, 2015) (+) Fujifilm management encouraged and promoted learning culture and this led to various novel products and innovation that subsequently were instrumental to the survival and sound performance of the firm (+)

The company was consistent in its strategic pursuit. There was consistency and agreement in its corporate, business and operational strategies (+) Fujifilm management style was characteristically lean. It was largely proactive with active employee participation and involvement in problem-­ solving activities (+)

(continued)

6.19 Discussion and Conclusion on Adaptations in Management Studies…

123

Table 6.5 (continued)

Adaptive behaviour paradigm Firm resources and reconfiguration orientation (FRRO)

Expected status in an adaptive firm +

Kodak Kodak had financial resources but was essentially lacking in implicit knowledge which is a major source of competitive advantage and value creation. It is also a central element for the development of dynamic core competencies. Both explicit and implicit (tacit) knowledge/resources are critical in adaptation process (−)

Fujifilm The company was evidently endowed with implicit knowledge and utilised it to its advancement (+)

This influences how resources are harnessed in terms of management processes, information exchange and organisational restructuring. Also, adaptations can occur across different pathways in various organisational contexts with resulting diverse implications. A synthesis of CCP, processual analysis and case study research method could form a methodological approach in investigating adaptations. It reflects a pluralistic approach to understanding the adaptation process. It helps in capturing ‘reality in flight’ as adaptation process is dynamic. The time quality of a processual research is evident in relating processes to outcomes. Process research is a dexterous activity full of intuition, judgement and tacit knowledge. There is no one best method of undertaking processual investigation. There exist a difference between process and processual analysis. Process is defined as a series of individual and communal events, actions and activities emanating over time in context. Processual analysis aims to dissect and describe mammoth of distinctions and complexities beneath organisational process. Processual analysis centres on describing, analysing and untangling the what, why and how of some sequence of individual and collective actions. The process adopted in change implementation can be a key factor in gauging an organisation’s responsiveness to prevailing influences. Case study research method is a strategic research methodology. The method is vital in giving answers to ‘How?’ and ‘Why?’ research questions, and in this respect, it is suitable for descriptive, exploratory or explanatory research. This research method is applicable in research into contemporary events such as adaptations in organisations in which the relevant behaviour(s) cannot be pre-planned. A rounded research in organisational adaptations may be based on the fit between content, contextual, process and process analyses than the character of an intended adjustment. This can be captured in the case study research method. Through the adopted research approach into Fujifilm and Kodak case study, we found that adaptation is contingent on intangible resources of the firm. It highlights the significance

124

6  Adaptations in Management Studies and Methodological Approaches in Adaptations

of adaptive behaviour paradigms. From the Kodak/Fujifilm case study, we were able to see in context the prevailing management theories and their implications in organisational adaptations. Furthermore, this case study revealed that the resultant adaptations are constituents of firm resources and how it was managed. As in the case of Fujifilm, ­transformational leadership style [managerial orientation] is a vital precursor to building firm adaptive capacity. Key Points for Practitioners • It is more appropriate to have open-minded and pluralistic approach to adaptation process in the firm. • Organisational adaptations typify consequences of human conducts, and these conducts are continuously in a process of becoming. • Managerial cognitive abilities are key to successful adaptation • Managerial complacency erodes value and hampers innovation in the firm. • Losing touch with the customer is the genesis of failing to adapt to market dynamics. • The timely response of the firm may be central to efficacy of the adaptation effort and firm’s ability to remain competitive. • Old/existing way of thinking or working may not be appropriate in the current market context. The challenge of the twenty-first century business organisation is not abating, rather it is exploding. Top managers should therefore play emphasis on developing their transformational leadership capabilities so as to remain competitive. Recommendation for Future Research • Considering that adaptation is multidimensional, can we develop and articulate a unified theory of organisational adaptation? • The adaptive behaviour paradigms may be tested in other adaptation research. • Multiple case studies can be tested in other sectors and industries to test the wider applicability and generalisability of the adaptive behaviour paradigm analytical framework. • Also, the significance of each proposition may be tested to ascertain criticality of each in organisational adaptation process. For instance, the significance of time and managerial orientations may be tested through sound operationalising technique. Various stakeholders [customers, competitors, employees, shareholders, regulators] will demand more from managers and their firms particularly as the world

6.19 Discussion and Conclusion on Adaptations in Management Studies…

125

market place is evolving as a result of sundry factors like issues of BREXIT in Britain and its unravelling implications on global brands operating in the EU and Britain; also of interest is Mr. Donald Trump’s Presidency and implications on global trade and trade relationships. other political events of which Russia and China are key players, the oil-producing countries and the emergent of the fourth industrial revolution championed by exploding technological innovations.

Summary of Key Points • Firm needs different set of capabilities to survive in different contexts of market externalities. • Firms need to continuously reinvent themselves so as to remain relevant and survive their evolving business environments. • Success in business environment yesterday does not guarantee success in business environment today or tomorrow. • Constituents of adaptation processes would likely be triggers of adaptation, manager cognition/perception of needed adaptation, adaptive behaviour paradigms, dynamic capabilities, adaptive capabilities, forms of adaptations and types of adaptation. • A typical adaptation process is grounded in multi-theoretical perspectives. • CCP, processual analysis and case study method help capture relevant components of adaptation process.

Chapter 7

Summing Up Organisational Adaptations

A lot has been discussed about organisational adaptations in the preceding chapters. Each chapter has expounded new insight about adaptations in organisations. We did this primarily to further our scholarly understanding of organisational adaptations through the lens of pluralism. Our view and call for pluralistic perspective is to articulate a panoramic view of the organisation and its environment. We hope this perspective will lead to a broadened, elaborate, relevant and expanded insight into firm and its environment than what a single perspective offers. This is beneficial to practitioners and academia in the sense that sole reliance upon singular perspective or theory might lead to the application of strategies, business models and solutions that are too narrow on a practical level or too weak to effect the desired change (Frishammar, 2006). Adaptation being a complex firm concept necessitates a multi-­ paradigm perspective for good understanding of the problem and to be better positioned to offer the most appropriate solution. In this chapter, we further examine the discourse on organisational adaptations by harnessing further insights from Kodak/Fujifilm case study as presented in the preceding chapter. After this, we examine the other sides of organisational adaptations; this section provides other issues associated with organisational adaptations. Our focus here is on factors hampering organisational adaptations. This discussion offers reasons why managers ought to have cautionary view to the concept of adaptation. The last section covers concluding remarks to the monograph, limitation of study and closing remarks.

7.1  Further Insights from the Case Study There are several observations and abstractions that can be deduced from Kodak/Fujifilm case study. We observed that in predictable or relatively stable environment, some firms are positioning themselves for survival. This was the case of Kodak. Its mass production system, capability of frequently rolling out quality films © The Author(s) 2018 O.E. Adegbite et al., Organisational Adaptations, SpringerBriefs in Business, DOI 10.1007/978-3-319-63510-1_7

127

128

7  Summing Up Organisational Adaptations

and excellent global distribution channels were superior in responding to threat of product superiority and market dominance from its competitors. But in the face of unpredictable business environmental challenges occasioned principally by technology discontinuity, Kodak was slow to change. The company was at best reactive rather than proactive. On the contrary, Fujifilm was proactive and quick in responding to the drastic and unpredictable advent of digital technology. Fujifilm’s adaptive capability was principally down to its quality market orientation, consistency of recruiting its executives within the firm and lean management style among others. The case also shows that organisations face greater uncertainties as their business environments change features from predictable/stable to unpredictable/stable states. In such situations, prior organisational experience or knowledge may be irrelevant or impede organisation’s ability to respond swiftly. Occurrences in contemporary business environments demand that organisations possess requisite capabilities to respond to uncertainties and complexities in their environments. In scenarios where organisation faces environmental unpredictabilities, organisation can leverage on its efficient processes to marshal all its resources to anticipate such changes or neutralise the effect of the environmental uncertainties. Time orientation element of the adaptive behavioural paradigms is important particularly in situations where firms face time pressure and burden of making appropriate decisions. Timely and appropriate response to environmental challenges is critical. The timely response of the firm may be central to efficacy of the adaptation effort and firm’s ability to remain competitive. From the case study, several theories and their implications were at play in organisational adaptation. Among these theories are contingency theory, firm response is contingent upon its resources, structure and occurrences in its business environment; resource base view (RBV), firm needs man and materials to thrive, particularly expertise knowledge and capabilities; organisational behaviour, how an organisation conducts its functions which evolve over time through the influence of organisation’s history, people, styles, interests and activities which have been institutionalised in the organisation; resource dependence theory (RDT), how firm gain its required resources through interfirm relationships; and organisational ambidexterity, how it enhances its survival by its ability to simultaneously accomplish alignment and adaptability. Organisational adaptation has both strategic and operational narratives which must be managed simultaneously. Fujifilm management team understood they have to push themselves hard in order to reorganise the firm and modify the existing business model. The top management understood this and was able to communicate or engage with other employees about the needed adaptive strategy of the firm (Komori, 2015). While doing this, Fujifilm approached the market cautiously by trying to understand the market dynamics as it unfolds and adapts its business model accordingly. Also, the company benefitted immensely by exploring other photographic-related markets while trying to safe its photographic heritage (Komori, 2015). Morgan, Vorhies and Mason (2009) reported that market orientation and marketing capabilities are complementary assets that contribute to superior firm performance. This was evident in Fujifilm’s case.

7.1 Further Insights from the Case Study

129

Managers at Fujifilm adopt transformational leadership role, motivating their employees to take initiatives and to be proactive and flexible without being coerced (Komori, 2015). Such autonomous initiatives emerge fortuitously and are hard to predict. They are embedded in and constrained by the evolving competence set of the organisation (Burgleman, 1991; McKelvey & Aldrich, 1983). Autonomous initiatives can originate at all strata of management. But they are most likely to emanate at a stratum where managers are actively abreast of new technological developments and changes in market conditions. As the organisation grows, autonomous are more likely to emerge at strata below top management (Burgleman, 1991). Fujifilm swung into action proactively and acted promptly to keep the business alive and adapts its core business technology to other profitable value offerings before the devastating impact of technology discontinuity. Fujifilm’s management encourages and promotes learning culture; this led to various novel products and innovation that subsequently were instrumental to the survival and sound performance of the firm (Komori, 2015). Firm’s structure and production architecture influence firm’s rate of response and quickness of adaptability. Fujifilm’s ability to learn and innovate both have a stronger internal alignment towards business processes and self-regeneration, while the firm’s proactiveness and aggressiveness both have a stronger external alignment towards the market and the competition (Miller & Friesen, 1983). Conversely, management system at Kodak impaired employees’ proactive initiatives during the moment of technology discontinuity (cf. Cravens 1995; Skalen & Edvarddsson, 2016). Kodak case is particularly instructive in that the timing of adopting its survival strategy and when it was deployed undermined its competitiveness. A similar adaptation strategy which proofs adaptive at a particular time in a firm organisational life may be non-adaptive at another point in time (Carley & Lee, 1998); adaptive strategy needs to evolve with time. They are significant in organisation’s life cycle. The case of Kodak and Fujifilm reflects the perceived change in market [customers’] perception of value. The case of technology discontinuity reveals how improvement in technology and market crave for current technological product upturned and redefined market’s perception of value. The change in value perception also has implications for value chain and power distribution among market players. The changes in organisational business environment erode prevailing equilibrium/balance in the firm structural features. To adapt to these changes and to gain knowledge of the environment, organisations need to gather information about the prevailing changes in their environments. Firm can achieve this through the application of a formalised competitor analysis system (Porter, 1980). It is also possible to apply more flexible and less formalised models for environmental scanning (Frishammar, 2006). Largely we can infer that for organisational adaptation to be achieved, the adaptation process is contingent on the presence of adaptive behaviour paradigms; particularly quality of market orientation and time of occurrences occupy central positions.

130

7  Summing Up Organisational Adaptations

The disequilibrium in the photographic business environment has implications for all dimensions of the business environment—macro, aggregate, task, ­sub-­environment and resource pool. Fujifilm was able to realign and adapt its resources—capabilities and business operations—in a timely manner to survive the technology discontinuity tsunami that ravaged the photographic industry. The company survived among others things by exhibiting its organisational ambidextrous prowess. Conversely, Kodak’s attempt to adapt through over-reliance on its traditional photographic capabilities did not yield the desired performance. Some market analysts and management scholars argue that Kodak management was complacent and did not take advantage of its huge investment in research and development (R&D). Others argue that the company’s huge and highly bureaucratic structure led to its mal adaptation when it was needed most. A critical analysis of the case shows that it was not a case of single impediments that led to Kodak’s bankruptcy. Some of these elements are discussed in the next section.

7.2  The Other Side of Organisational Adaptations Adaptations come with its attendant challenges. In this section challenges, criticisms associated with organisation adaptations are discussed. Some of these criticisms are linked to organisational learning practices, and it is believed that an organisation can only adapt as swift as it can learn (Othman & Hasmin, 2004). Also the way organisation learns may be enhanced or impeded by some factors. Learning impacts on firm productivity and it has also been implicated in dynamic capabilities. The paradoxical feature of adaptation is one of challenges facing the concept. Dynamic capabilities have been instrumental to firm’s ability to reconfigure its resources to compete; it has also been implicated in the menace firm recursiveness. Other identified challenges include organisational inertia, internal and external adaptations and constraints and criticisms confronting adaptation both in domestic and international business settings. The problems of organisational inertia and others like excessive and presumptive adaptation are discussed in the following sections.

7.3  Organisational Inertia Organisational inertia refers to the firms’ inability to change as quickly as their environment (Pfeffer, 1997). Inertia may also refer to the unplanned consequences of successful firm performance. It is an essential attribute of the analytical set-up accompanying discontinuous change (Weick & Quinn, 1999). Some identified forms of inertia are top management term/tenure (Virany, Tushman, & Romanelli, 1992), complacency (Kotter, 2012), first-order change (Bartunek, 1993), routines (Gioia, 1992; Jarzabkowski, 2004), deep-rooted structure (Gersick, 1991), identity maintenance (Sevon, 1996), culture (Harrison & Carroll, 1991) and technology

7.3 Organisational Inertia

131

(Tushman & Rosenkopf, 1992). Generally it is held that once organisations become established, they are relatively inert and possess stable structures that are naturally organised by conditions at the time of their founding (Sandell, 2001). This reinforces Hannan and Freeman’s (1977) argument that due to the serious limitations of organisations’ ability to adapt considering various organisational processes that create structural inertia, selection is more appropriate in explaining organisational change than adaptation. Organisation inertia arises both from internal structural arrangements and environmental constraints (Frishammar, 2006). Internal constraints that lead to structural inertia are seen in form of investments in plants and equipment including specialised manpower, i.e. resources viewed as sunk costs when attempting to effect change. Furthermore managers face serious limitations on the internal information available to them as well as internal political constraints. This manifests in form of departmental rivalry over fixed resources. Political alliances in organisations often have individual/group’s stake in evolving strategies and this might impede desire organisational modification (Pettigrew, 1973, 1997). Closely associated with this is the limitation experience based on the firm’s own history, i.e. path dependence constrain. Other identified internal constraints are insight, action and psychological inertia (Godkin & Allcorn, 2008). They constitute major impediments inhibiting institutional willingness to develop and effect strategic direction (Hedberg & Ericson, 1997). These issues are particularly crucial when trying to make strategic changes in direction which have corresponding significant impact on organisational performance (Godkin & Allcorn, 2008). Such significant strategic impact may be associated with sales, production or financial functions. Aside these functions, significant strategic impact may relate to firm-wide turnaround effort or compliance effort confronting the firm. Insight, action and psychological inertia often surface when managers need to effect change at critical moment. The trio of insight, action and psychological inertia may pose grave threat to organisational survival or performance when it matters most (Godkin & Allcorn, 2008; Hedberg & Ericson, 1997). Insight inertia emerges where there is a time gap between key adjustments in the organisational environment and organisational awareness of such adjustments. The discerning of such adjustments and awareness of their eventual consequences does not surface in a timely manner or may not at all. Action inertia emerges after managers gain insight from environmental scanning, but management response lacks deserved promptness, and the resultant change efforts do not occur in time to be competitive (Hedberg & Wolff, 2003). Psychological inertia is a consequent of psychoanalytical process that leads to stress, anxiety and psychological defensiveness. This may result in individual and group compromises and dysfunctions that negatively impacted on organisational performance (Allcorn & Diamond, 1997). These identified constraints impede organisational ability to adapt, and if they do, they do so gradually (Péli, Bruggeman, Masuch, & Nualláin, 1994). The identified external pressures leading to inertia are (1) legal and fiscal barriers to market entry and exit and (2) the challenge of obtaining legitimacy for one’s firm operations (Frishammar, 2006). Both internal and external constraints are believed to undermine firm’s ability to adapt. According to Hannan and Freeman (1977), the

132

7  Summing Up Organisational Adaptations

challenge of organisational inertia underlies the relevance of the population-ecology perspective. The proponents of this perspective opine that environmental conditions select certain types of organisations for survival, while other organisations diminish or disappear. However, the concept of selection goes beyond firm survival or death, because positively selected organisations are construed as better fit vis-à-vis a particular environment than those that fail. Selection influences are said to be evident in circumstances where relative effectiveness, rather than survival, is of concern, while proponents of organisational selection advanced empirical findings to back their arguments. Finally, some organisational ecologists have also made broader, non-contingent claims about the expensiveness of change and the benefits of inertia (Hannan & Freeman, 1984). The concept nevertheless raises two vital questions—what is being selected and by whom? It is argued that main differences among organisational types are evident in the concept of ‘organisational form’ (Aldrich, 1999; Lin & Hui, 1999; Womack, Jones, & Roos, 1990). The next question therefore is who then selects? Population ecologist believed that environment is the selecting agent; however, not all selection emanates from the working of an unseen effect (Hannan & Freeman, 1977). Selection may emanate as an outcome of political decisions influenced by other organisations (Aldrich, 1999). Population ecologists understate the role of adaptation, but they agree that organisations articulate strategies and try to adapt to environmental contingencies. Therefore, it could be inferred that population ecologist agreed that organisations exhibit some form of observed structural flexibility which may be the consequences of adaptive behaviour to say the least. Ecologists view the adaptation phenomenon as a minor part, although some researchers in population ecology have in recent past downplayed the proposition that adaptation is a rare phenomenon, with emphasis now on the relative roles of adaptation and selection in evolutionary change (Amburgey & Rao, 1996).

7.4  Excessive Adaptation Excessive adjustments may reflect undesirable outcomes but well-intended intentions. This might take the form of change aimed at empire building or unreflective ‘change for change’s sake’. The likelihood of excessive adjustment has received relatively little attention in either the strategy or management literatures—with some notable exceptions. Selznick’s (1957) initial work, for instance, specifically argues that adapting too readily to environmental changes may negatively impact organisational performance and ruin organisational competencies. He warns continually against the menaces of what he terms ‘opportunistic adaptation’. This is defined as organisational change undertaken without sufficient consideration of the organisation’s historical competencies or commitments. Hedberg (1981) also suggests that if a firm pursuing a particular strategy has been accumulating strategy-­specific competencies, then a shift away from that strategy is likely to be costly (at least in the short run) in terms of learning new competencies or unlearning existing ones. In this regard, the frequent change in leadership and change in strategy at Kodak in the

7.6 Liability of Recursiveness

133

1990s readily comes to mind. Rumelt (1995) also argues that resources such as reputation and customer loyalty may be damaged if an organisation seeks to enter expanding markets far from its traditional domain or offers lower-quality products that could weaken customers ‘identification with the firm’. This point may be partly responsible for Kodak’s slow response in adapting to changes in the photographic business. Perhaps the company had thought that their reputation will be jeopardised as the company was synonymous with conventional photography. Finally, some organisational ecologists have also made broader, non-contingent claims about the expensiveness of change and the benefits of inertia (Hannan & Freeman, 1984).

7.5  Presumptive Adaptation This refers to the art of adapting to local environment. It may pose a daunting task and much more so in adapting business practices from the headquarters to business functions in the host countries where firm has foreign presence. Presumptively adapting a practice to align to a particular environment, so as to be responsive to local institutions, may not yield desired adjustment (Leonard-Barton, 1988). And as such adaptation should proceed cautiously and steadily in carefully planned stages that preferably involve a single modification at a time (Szulanski & Jensen, 2006). Extensive adaptations, involving two or more concurrent adjustments, are based on the presumption that the modified practices can be honed, stabilised and institutionalised without referring back to a prototype. When this presumption is true, such adaptations improve the effectiveness of knowledge transfer. However, when this is not true, presumptive adaptation may severely undermine organisational effectiveness in host country business operations (Szulanski & Jensen, 2006; Westney, 1987).

7.6  Liability of Recursiveness Firm learning attributes is a resource-deepening behaviour that results in firm’s idiosyncratic competences and capabilities (Karim & Mitchell, 2000). With this notion in mind, firm learning efficiencies are tantamount to recursiveness. This occurs so that organisation becomes ‘perfect’ through learning practices. From this perspective, recursiveness may be linked to best practice (Jarzabkowski, 2004). However, the convergence that reinforces best practice may also be linked to forms of organisational inertia and the elimination of strategic differentiation between competitors (Eisenhardt & Martin, 2000). This dichotomy of recursive practice is expressed as an enigma for successful firms (Jarzabkowski, 2004). The managerial, cultural, structural and processual factors associated with a firm’s success have a tendency to become over-practiced, placing the firm on a trajectory of increasingly recursive behaviours that predispose to failure due to inability to adapt (Miller, 1990, 1993; Miller, & Friesen, 1984). Paradoxically, recursive practice is also associated with success; this implies a case of enthralling risk for firms (Jarzabkowski, 2004).

134

7  Summing Up Organisational Adaptations

7.7  Organisational Amnesia This is a firm’s failure to utilise organisational learning to achieve adaptation and value creation desired from learning (Kransdorff, 1998). This implies that not all organisational learning results in adaptation. Organisation ought to utilise knowledge generated at individual levels to create value and competitive advantage. When lessons learnt from individual level do not diffuse within the organisation or lead to adaptation, the consequence is organisational amnesia. Organisation has natural propensity to forget. Organisational amnesia is inevitable when organisations have either lost their corporate memory or are unable to recall their corporate history— time amnesia. This aberration also occurs as a result of organisational inability to promptly disseminate lessons learnt from one department of the organisation to another—space amnesia (Othman & Hasmin, 2004). Organisational amnesia is distinctively different from resistance to change. The latter happens when there is resistance to change initiatives, whereas the former occurs when there is failure to respond and initiate adaptation. Organisational learning occurs when individual members of an organisation spot the inconsistency between actual and expected outcomes and attempt to proffer solution or challenge underlying theories. Organisational learning should transcend the aggregation of the learning of organisation’s members (Cohen & Levinthal, 1990). Organisation loses opportunities to create value or achieve competitive advantage when learnt lessons at individual level are not stored and diffused to others in the organisation (Othman & Hasmin, 2004). Organisational ability to manage individual expertise and knowledge base at its disposal is a function of organisation design (Othman & Hasmin, 2004). This assertion is based on the conceptualisation of organisations as socially constructed communities where individual and social professionals are members transformed into value-generating entities through the proactive organisational practices. With the promotion of learning orientation across the organisation, the firm is well placed not only to create value and achieve competitive advantage but also to avoid the pitfall of organisational amnesia.

7.8  D  iscussions and Conclusion on the Other Side of Organisational Adaptations The main achievement of this study is the extensive examination of organisational adaptations from a pluralistic perspective. We hope that this effort will broaden existing knowledge on organisational adaptation and stimulate further scholarly debate in our quest towards understanding this important concept in management studies. Although this work is not the first to articulate multi-paradigm or pluralistic view in management studies (examples of scholarly works in this regard include Gioia & Pitre, 1990; Spender, 1998; Lewis & Grimes, 1999; Lewis & Kelemen, 2002), our effort further reinforces the importance of this scholarly stand as it relates

7.8 Discussions and Conclusion on the Other Side of Organisational Adaptations

135

to organisational adaptation. It is the first [to the best of our knowledge] to present a pluralistic view from various dimensions in each of the chapter in this monograph. From the beginning to the end of this monograph, various insights into the phenomenon were presented through a pluralistic approach. There are many research spinoffs that could emanate from this work; we are hopeful that the knowledge from this study will provide a platform for further industry-specific inquiry into adaptation processes under multi-paradigm perspective. From the case study analysis, it seems that adaptive behaviour paradigms like market orientation, time orientation and managerial orientation are of great importance in influencing adaptations. Related to this we found out that people are the main resources of any organisation. The behavioural features of adaptation cannot be detached from its social reality in which people are the key actors and also constitute important organisational resource. Dynamic capabilities are linked to firm specialised knowledge at firm’s disposal and employees are natural vault of knowledge. Firm’s ability to reconfigure other resources—tangible and intangible—lies with its manpower resource. An organisation is only as effective as people working within it (Robbins & Judge, 2009). Knowledge is a key intangible resource in the adaptation processes, particularly implicit knowledge; this resides in the employees. According to Shin (2004) five cluster knowledge management (KM) system approaches, namely, technological, intellectual asset, organisational learning, process and philosophical. These approaches can be grouped into two broad types, namely, soft and hard. The soft type is mainly focused on tacit knowledge and on the difficulties in sharing it between people. The hard type is focused on developing tools for storage and distribution of explicit knowledge. Tacit knowledge—an important element of dynamic capabilities—exists in a person’s mind, a personal quality that may be difficult to communicate (Hilliard, 2004; Nonaka, 1994; Spender, 1996). It is difficult to replicate or transferred (Nonaka, 1994). In instances where it can be transferred, it is achieved through teaching by example (Nonaka, 1994); it features as un-codifiable knowledge but which is observable (Hilliard, 2004). Tacit knowledge can be acquired through experience (Nonaka, 1994; Spender, 1996). This knowledge is embedded in human action, commitment and involvement in a specific context (Nonaka, 1994). It is also known as implicit knowledge (Spender, 1996). From the case study and particularly the account of Komori (2015), it seems likely that Fujifilm’s ability to transit to digital photography was partly down to its implicit knowledge and its ability to manage it (Nonaka, 1994; Spender, 1996). This does not translate into relegating the vital contribution of explicit knowledge in the adaptive process; in fact, Zollo and Winter (2002) argued that ‘dynamic capabilities emerge from the co-evolution of tacit experience accumulation processes with explicit knowledge articulation and codification activities’ (pp.344). We believed this statement was held true in the case of Fujifilm’s adaptive quest. With this in mind, we consider pluralistic perspective to be an integral approach in understanding organisational adaptation. This approach presents scholars in organisational studies and practitioners an avenue to harness together from existing body of management paradigms into an

136

7  Summing Up Organisational Adaptations

interrelated network of perspectives that are complementarily enriching and help broaden our understanding of organisation adaptation dynamics (Gioia & Pitre, 1990; Tsoukas, 1994).

7.9  Concluding Highlights With a synthesised method of CCP framework, processual analysis and case study from different management literatures and case examination of Kodak and Fujifilm, we are able to highlight the following: 1. The critical underlying concepts in organisational adaptation are adaptive behavioural paradigms and resource-based view, particularly tacit knowledge, dynamic capabilities and adaptive capabilities. 2. Adaptations could be path dependent; the prevailing organisational content and context in which they occur may influence the process, forms and types of such adaptations. 3. Adaptations in organisations take several forms and types based on the perspectives of the actors 4. It may occur in a continuum from minor to major and with change in context and require approach. 5. Major organisational adaptations as seen in cases of disruptive technology or technology discontinuity demand the requisite presence of (1) above. 6. Adaptation is essentially a process phenomenon; it is a moving target. This may necessitate shifting contexts, content or relevant processes. To better understand this important organisational concept, it is beneficial for academicians and practitioners to be open-minded and adopt a pluralistic approach. Albeit the CCP framework will be a relevant guide in this direction. 7. Adaptation is a behavioural phenomenon in which humans act both as actors and resources. They occupy central position in the process of this social reality. Our pluralistic stand is further buttress when we consider Maclean, Maclntosh and Siedl’s (2015) argument that basic concepts of human actions such as rational action (Teece, Pisano & Shuen, 1997) and normative action (Eisenhardt & Martin, 2000) are not sufficient in untangling the concept of dynamic capabilities. Thus, the call for a different concept that explains human action of decision-making such as creative action (Maclean et al., 2015). Creative action articulates that idea of creativity as a central feature of human action (Maclean et al., 2015). The concept emphasises how actors comprehend the particular action situation in which they find themselves and the manner they choose specific courses of action in response to the basics of that situation. This allows for choices in the handling of situations, and, in the actions chosen, this concept of action is inherently able to integrate the creative element of human action into its conceptual composition. None of these approaches is irrelevant rather they seem to complement and broaden our understanding of [e.g. dynamic capabilities as a vital

7.11 In Closing

137

component in] organisational adaptations. The rational action approach focuses on the firm level, while normative action addresses the group or unit level of the firm and creative action relates to individual human level in the firm. Considering the fact that organisational adaptations pervade every level in the firm (Miles & Snow, 1978), the three distinct approaches of rational, normative and creative actions do reflect a distinct aspect of organisations adaptations. We articulate that in any specific organisational adaptation context, there exist various paradigms, theories/concepts either complementing [e.g. RBV, RDT, contingency theory, etc] or conflicting [e.g. recursiveness, organisational amnesia, Organisational inertia, etc]. This insight describes organisational adaptation as a gestalt (Miller & Friesen, 1980).

7.10  L  imitation of Study and Suggestions for Further Research As with any field of academic inquiry, some limitations arise from trade-off decisions we made in our study framework. First, the theme is generic in nature as it pictures adaptation in general business organisation sense. Although the case study covered the important event of technology discontinuity that revolutionise the photographic industry, more research efforts are needed to test and establish the propositions in high-velocity and non-high-velocity industries but are operating in global market environments. A comparative study of pluralistic perspective and single perspective research in organisational adaptations and their implications may be investigated. Also, research into how various organisational theories evolve and impact on organisational adaptation in specific context will help further our holistic knowledge of this important organisational concept. Such efforts will contribute to the development of a pluralistic theoretical perspective in the field of organisational adaptations. Lastly, further research to refine operationalizing the suggested adaptive behavioural paradigms’ analytical framework and identify the multidimensional nature of these adaptive behavioural constructs will enhance our understanding of organisational adaptations and its relationship to organisational performance.

7.11  In Closing We present organisational adaptations as a complex phenomenon that can be understood and explored through systematic and pragmatic investigation. The economic and business reality of the twenty-first century demands that firms should be more flexible in the area of business operations. Adaptive organisations will experience effectiveness, as agility replaces mechanistic parameters of decision-making.

138

7  Summing Up Organisational Adaptations

Although the best decision is the one that produces the highest reward and may not be feasible or suitable in all contexts of organisational life, we suggest the overriding agenda should be to keep the organisation afloat [survive], to thrive and be able to accomplish its full potentials of superior performance in dynamic business environment through sound adaptive capacity. The pluralistic perspective is both beneficial on pragmatic and philosophical levels. On a pragmatic level, this approach helps the exploration of pluralism and paradox, facilitating the furtherance of understanding the diversity [scope], complexity and ambiguity associated with organisational adaptation. On a philosophical level, this approach encourages greater reflexivity in organisational adaptation inquiries. Yet such advantages are interlinked—to capture organisational complexities, the researcher must reflect on his own research practices and their potential influence upon the item of inquiry (Lewis & Kelemen, 2002). Adopting a single perspective may generate likely valuable but myopic view deficient in exposing the multidimensional nature of organisational adaptation. Pluralistic perspective, in contrast, may aid ‘more comprehensive portraits of complex organisational phenomena’ (Gioia & Pitre, 1990: 587) by helping researchers challenge and explore discrepancies. Our position is further solidified in Volberda and Lewin’s assertion that ‘It is becoming increasingly obvious that single-theme explanations for the adaptation—selection phenomenon have reached their limit… No single theory of selection or adaptation explains how and why firms coevolve and develop over time as they do’ (Volberda & Lewin, 2003:2114). With this in mind, and based on further analytical assessment demonstrated in this study, it is evident that organisational adaptation is a phenomenon of many parts that is best studied and managed through a pluralistic approach.

References

Acıkdilli, G., & Ayhan, D.  Y. (2013). Dynamic capabilities and entrepreneurial orientation in the new product development. International Journal of Business and Social Science, 4(11), 144–150. Adam, B. (1990). Time and social theory. Philadelphia: Polity Press. Adam, B. (1995). Time watch? The social analysis of time. Cambridge: Polity Press. Adler, P., Goldoftas, B., & Levine, D. (1999). Flexibility versus efficiency? A case study of model changeovers in the toyota production system. Organization Science, 10(1), 43–68. Adner, R., & Helfat, C. (2003). Corporate effects and dynamic managerial capabilities. Strategic Management Journal, 24, 1011–1025. Albaum, G., & And Tse, D. K. (2001). Adaptation of international marketing strategy components, competitive advantage, and firm performance: A study of hong kong exporters. Journal of International Marketing, 9(4), 59–81. Albert, S. (1995). Towards a theory of timing: An archival study of timing decisions in the persian gulf war. In L. Cummings & B. M. Staw (Eds.), Research in organizational behaviour (Vol. 17, pp. 1–70). Greenwich, CT: JAI Press. Alchian, A. A. (1950). Uncertainty, evolution, and economic theory. Journal of Political Economy, 58(3), 211–221. Aldrich, H. E. (1979). Organizations and environments. Englewood Cliffs, NJ: Prentice-Hall. Aldrich, H. E., & Auster, E. R. (1986). Even dwarfs started small: Liabilities of age and size and their strategic implications. In L. L. Cummings & B. M. Staw (Eds.), Research in organizational behaviour (Vol. 8, pp. 165–198). Greenwich, CT: JAI Press. Aldrich, H. E., & Mueller, S. (1982). The evolution of organizational forms: Technology, coordination, and control. In B. M. Staw & L. L. Cummings (Eds.), Research in organizational behaviour (Vol. 4, pp. 33–87). Greenwich, CT: JAI Press. Aldrich, H. E., & Pfeffer, J. (1976). Environments of organizations. Annual Review of Sociology, 2, 79–105. Aldrich, H. (1999). Organizations evolving. Thousand Oaks, CA: Sage. Alessandri, T. M., Ford, D. N., Lander, D. M., Leggio, K. B., & Taylor, M. (2004). Managing risk and uncertainty in complex capital projects. The Quarterly Review of Economics and Finance, 44(50), 751–767. Allcorn, S., & Diamond, M. A. (1997). Managing people during stressful times. Westport, CT: Quorum Books. Alvarez, S. A., & Barney, J. B. (2005). How do entrepreneurs organize firms under conditions of uncertainty? Journal of Management, 31(5), 776–793. Ambrosini, V., & Bowman, C. (2009). What are dynamic capabilities and are they a useful construct in strategic management? International Journal of Management Reviews, 11(1), 29–49. © The Author(s) 2018 O.E. Adegbite et al., Organisational Adaptations, SpringerBriefs in Business, DOI 10.1007/978-3-319-63510-1

139

140

References

Ambrosini, V., Bowman, C., & Collier, N. (2009). Dynamic capabilities: An exploration of how firms renew their resource base. British Journal of Management, 20(1), S9–S24. Amburgey, T. L., & Rao, H. (1996). Organizational ecology: Past, present, and future directions. The Academy of Management Journal, 39(5), 1265–1286. Amit, R., & Schoemaker, P. (1993). Strategic assets and organizational rent. Strategic Management Journal, 14, 33–46. Ancona, D. G., Goodman, P. S., Lawrence, B. S., & Tushman, M. L. (2001). Time: A new research lens. The Academy of Management Review, 26(4), 645–663. Ancona, D.  G., Okhuysen, G.  A., & Perlow, L.  A. (2001). Taking time to integrate temporal research. The Academy of Management Review, 26, 512–529. Anderson, P. (1999). Complexity theory and organization science. Organization Science, 10(3), 216–232. Andrews, K. R. (1971). The concept of corporate strategy. Homewood, IL: Irwin. Ansoff, I. (1988). Corporate strategy. London: Penguin Books. Ansoff, H. I., & Hayes, R. L. (1976). Introduction. In H. I. Ansoff, R. P. Declerck, & R. L. Hayes (Eds.), From strategic planning to strategic MANAGEMENT (pp. 1–12). New York: Wiley. Appelbaum, S.  H., Habashy, S., Malo, J., & Shafiq, H. (2012). Back to the future: Revisiting Kotter’s 1996 change model. The Journal of Management Development, 31(8), 764–782. Aragón-Correa, J. A. (1998). Strategic proactivity and firm approach to the natural environment. The Academy of Management Journal, 41(5), 556–567. Aragón-Correa, J. A., & Sharma, S. (2003). A contingent resource-based view of proactive corporate environmental strategy. The Academy of Management Review, 28, 71–88. Argote, L. (1999). Organisational learning: Creating, retaining, and transferring knowledge. Boston, MA: Kluwer Academic. Argyris, C., & Schon, D. (1978). Organizational learning: A theory of action perspective. Reading, MA: Addison-Wesley. Armenakis, A. A., & Bedeian, A. G. (1999). Organisational change: A review of theory and reseach in the 1990s. Journal of Management, 25(3), 293–315. Ashby, W. R. (1958). Requisite variety and its implications for the control of complex systems. Cybernetica, 1(2), 83–99. Ashill, N. J., & Jobber, D. (2010). Measuring state, effect, and response uncertainty: Theoretical construct development and empirical validation. Journal of Management, 36(5). Astley, W. G., & Van de Ven, A. H. (1983). Central perspectives and debates in organization theory. Administrative Science Quarterly, 28(2), 245–273. Astley, W.  G. (1985). The two ecologies: Population and community perspectives on organizational evolution. Administrative Science Quarterly, 30(2), 224–241. Augier, M., & Teece, D. J. (2008). Strategy as evolution with design: The foundations of dynamic capabilities and the role of managers in the economic system. Organization Studies, 29(8/9), 1187–1208. Auster, E. R. (1994). Macro and strategic perspectives on interorganizational linkages: A comparative analysis and review with suggestions for reorientation. In P. Shrivastava, A. S. Huff, & J. E. Dutton (Eds.), Advances in strategic management: 3-40. Greenwich, CT: JAI Press. Austrade. (2002). Knowing and growing the exporter community. Sydney: Australian Trade Commission. Axelrod, R., & Cohen, M.  D. (2000). Harnessing complexity: Organizational implications of a scientific frontier. Retrieved June 18, 2015, from http://www.innovationlabs.com/harnessing_ complexity.pdf Baird, I.  S., & Thomas, H. (1985). Toward a contingency model of strategic risk taking. The Academy of Management Review, 10, 230–243. Baker, W.  E., & Sinkula, J.  M. (1999). The synergistic effect of market orientation and learning orientation on organizational performance. Journal of the Academy of Marketing Science, 27(4), 411–427. Baldauf, A., & Cravens, D. W. (1999). Improving the effectiveness of field sales organizations: A European perspective. Industrial Marketing Management, 28, 63–72. Barnard, C. (1938). The functions of the executive. Cambridge, MA: Harvard University Press.

References

141

Barney, J. (1986). Strategic factor markets: Expectations, luck, and business strategy. Management Science, 32(10), 1231–1241. Barney, J. B. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17(1), 99–120. Barney, J.  B. (1997). Gaining and sustaining competitive advantages. Reading, MA: Addison-Wesley. Barney, J. B., & Clark, D. N. (2007). Resource-based theory: Creating and sustaining competitive advantage. Oxford: Oxford University Press. Barney, J., Wright, M., & Ketchen, D. J., Jr. (2001). The resource-based view of the firm: Ten years after 1991. Journal of Management, 27, 625–641. (From the Special Issue Editors). Bartel-Radic, A., & Lesca, N. (2010). Requisite Variety and Intercultural Teams: To What Extent is Ashby’s Law Useful? Retrieved June 19, 2015, from https://halshs.archives-ouvertes.fr/ halshs-00516674/document Barreto, I. (2010). Dynamic capabilities: A review of past research and an agenda for the future. Journal of Management, 36(1), 256–280. doi:10.1177/0149206309350776. Bartlett, C.  A., & Ghoshal, S. (1989). Managing across borders: The transnational solution. Boston, MA: Harvard Business School Press. Bartlett, C. A., & Ghoshal, S. (1993). Beyond the M-form: Toward a managerial theory of the firm. Strategic Management Journal, 14, 23–46. Bartlett, C. A., & Beamish, P. W. (2014). Transnational management: Text, cases and readings in cross-border management (7th ed.). McGraw Hill Education. Bartunek, J. M. (1993). Rummaging behind the scenes of organizational change—And finding role transitions, illness and physical space. Research in Organizational Change and Development, 7, 41–76. Baumol, W. J. (1986). Entrepreneurship and a century of growth. Journal of Business Venturing, 1, 141–145. BBC News. (2015). Barclays Sacks Boss Antony Jenkins in Row over Strategy. Retrieved July 8, 2015, from http://www.bbc.co.uk/news/business-33438914 Beard, D. W., & Dess, G. G. (1981). Corporate-level strategy, business-level strategy, and firm performance. The Academy of Management Journal, 24(4), 663–688. Bendapudi, N., & Berry, L. L. (1997). Customers’ motivations for maintaining relationships with service providers. Journal of Retailing, 73(1), 15–37. Berchtold, S., Pircher, R., & Stadler, C. (2010). global integration versus local adaptation: A case study of Austrian MNCs in Eastern Europe. European Journal of International Management, 4(5), 524–549. Berger, P. L., & Luckmann, T. (1966). The social construction of reality. New York: Doubleday. Berman, S. L., Wicks, A. C., Kotha, S., & Jones, T. M. (1999). Does stakeholder orientation matter? The relationship between stakeholder management models and firm financial performance. The Academy of Management Journal, 42(5), 488–506. (Special Research Forum on Stakeholders, Social Responsibility, and Performance). Betton, J., & Dess, G. G. (1985). The application of population ecology models to the study of organizations. The Academy of Management Review, 10(4), 750–757. Blalock, H.  M., Jr. (1969). Theory construction: From verbal to mathematical formulations. Englewood Cliffs, NJ: Prentice-Hall. Blalock, H.  M., Jr. (1989). The real and unrealized contributions of quantitative sociology. American Sociological Review, 54, 447–460. Birkinshaw, J., & Heywood, S. (2010). Putting organizational complexity in its place. In Insight and Publication. (2015). McKinsey & Company. Retrieved August 29, 2015, from http:// www.mckinsey.com/insights/organization/putting_organizational_complexity_in_its_place Blount, S., & Janick, G. A. (2001). When plans change: Examining how people evaluate timing changes in work organisations. The Academy of Management Review, 10, 107–124. Bluedorn, A.  C., & Denhardt, R.  B. (1988). Time and organizations. Journal of Management, 14(2), 299–320. Boisot, M., & Child, J. (1999). Organizations as adaptive systems in complex environments: The case of China. Organization Science, 10(3), 237–252. doi:10.1287/orsc.10.3.237.

142

References

Boulding, K. E. (1956). General systems theory-the skeleton of science. Management Science, 2, 197–208. Bourgeois, L. J., & Eisenhardt, K. (1988). Strategic decision processes in high velocity environments: Four cases in the microcomputer industry. Management Science, 34, 816–835. Bower, J. L. (1970). Managing the resource allocation process. Boston, MA: Harvard Business School. Bowers, D. G., & Seashore, S. E. (1966). Predicting organizational effectiveness with a four-factor theory of leadership. Administrative Science Quarterly, 11(2), 238–263. Bowman, C., & Ambrosini, V. (2003). How the resource-based and the dynamic capability views of the firm inform competitive and corporate level strategy. British Journal of Management, 14, 289–303. Boztepe, S. (2007). Toward a framework of product development for global markets: A user value-­ based approach. Design Studies, 28(5), 513–533. Brealey, R., & Myers, S. (1988). Principles of corporate finance. New York: McGraw-Hill. Brei, V. A., D’Avila, L., Camargo, L. F., & Engels, J. (2011). The influence of adaptation and standardization of the marketing mix on performance: A meta-analysis. Brazilian Administration Review, 8(3), 266–287. Brennan, R., & Turnbull, P.  W. (1995). Adaptations in buyer-seller relationships. In: IMP 11th Conference 1995, Conference Paper. Manchester: Manchester Federal School of Business and Management. Brennan, R., & Turnbull, P. (1996). The process of adaption in inter-firm relationships. In H. G. Gemünden, T. Ritter, & A. Walter (Eds.), Relationships and networks in international markets (pp. 65–80). Oxford: Elsevier. Brennan, R., & Turnbull, P. (1999). Adaptive behaviour in buyer—Seller relationships. Industrial Marketing Management, 28, 481–495. Brennan, D. R., Turnbull, P. W., & Wilson, D. T. (2003). Dyadic adaptation in business-to-business markets. European Journal of Marketing, 37(11/12), 1636–1665. Brittain, J., & Freeman, J. (1980). Organizational proliferation and density-dependent selection. In J. R. Kimberly & R. Miles (Eds.), The organizational life cycle (pp. 291–338). San Francisco: Jossey-Bass. Brockhaus, R. H. (1980). Risk taking propensity of entrepreneurs. The Academy of Management Journal, 23, 509–520. Brown, S. J. (2000). Ontological security, existential anxiety and workplace privacy. Journal of Business Ethics, 23(1), 61–65. Brown, J. S., & Duguid, P. (1991). Organizational learning and communities of practice: Toward a unified view of working, learning and innovation. Organization Science, 2, 40–57. Brown, S. L., & Eisenhardt, K. (1997). The art of continuous change: Linking complexity theory and time-paced evolution in relentlessly shifting organizations. Administrative Science Quarterly, 42(1), 1–34. Brown, S. L., & Eisenhardt, K. M. (1998). Competing on the edge: Strategy as structured chaos. Boston: Harvard Business School Press. Brown, J. S., & Duguid, P. (2001). Knowledge and organization: A social-practice perspective. Organization Science, 12(2), 198–213. doi:10.1287/orsc.12.2.198.10116. Bruni, D.  S., & Verona, G. (2009). Dynamic marketing capabilities in science based firms: An exploratory investigation of the pharmaceutical industry. British Journal of Management, 20, 101–117. Brush, T. H., & Artz, K. W. (1999). Toward a contingent resource-based theory: The impact of information asymmetry on the value of capabilities in veterinary medicine. Strategic Management Journal, 20(3), 223–250. Buchanan, D. A. (1991). Vulnerability and agenda: Context and process in project management. British Journal of Management, 2(3), 121–132. Buchanan, D., & Boddy, D. (1992). The expertise of the change agent. London: Prentice Hall. Buchko, A.  A. (1994). Conceptualisation and measurement of environmental uncertainty: Am assessment of miles and snow perceived environmental uncertainty scale. The Academy of Management Journal, 37, 410–425.

References

143

Buckley, P. J., & Carter, M. J. (2004). A formal analysis of knowledge combination in multinational enterprises. Journal of International Business Studies, 35(5), 371–384. Burgleman, E. A. (1991). Intraorganizational ecology of strategy making and organizational adaptation: Theory and research. Organization Science, 2/3, 239–262. Burns, T., & Stalker, G. (1961). The management of innovation. London: Tavistock. Burrell, G., & Morgan, G. (1979). Sociological paradigms and organisational analysis. Ashgate. Buzzell, R. (1968). Can you standardize multinational marketing? Harvard Business Review, 46, 102–113. Cadogan, J. W., Souchon, A. L., & Procter, D. B. (2008). The quality of market-oriented behaviors: Formative index construction. Journal of Business Research, 61, 1263–1277. Calatone, R. J., Cavusgil, T., Schmidt, J. B., & Shin, G. C. (2004). Internalization and the dynamics of product adaptation: An empirical investigation. Journal of Product Innovation Management, 21(3), 185–198. Calatone, R. J., Daekwan, K., Schmidt, J. B., & Cavusgil, S. T. (2006). The influence of internal and external firm factors on international product adaptation strategy and export performance: A three-country comparison. Journal of Business Research, 59, 176. Caldwell, D., & O’Reilly, C., III. (1982). Responses to failure: The effects of choice and responsibility on impression management. The Academy of Management Journal, 25, 121–136. Canning, L. E. (1999). The introduction of environmental (Green) adaptations in supplier-­customer relationships. Unpublished Ph.D., UWE, Bristol. Canning, L. E., & Hanmer-Loyd, S. H. (2001). Managing the environmental adaptation process in supplier–customer relationships. Business Strategy and the Environment Journal, 10, 225–237. Canoa, C. R., Carrillat, F. A., & Jaramillo, F. (2004). A meta-analysis of the relationship between market orientation and business performance: Evidence from five continents. International Journal of Research in Marketing, 21, 179–200. Capron, L., & Mitchell, W. (1999). The impact of relevant resources and market failure on modes of business change, Working paper, University of Michigan. Carley, K.  M. (2000). Chapter 11: Organizational adaptation in volatile environments. In C.  L. Hulin & D. R. Ilgen (Eds.), Computational modeling in organizational behaviour: The third scientific discipline. Washington, DC: American Psychological Association. Carley, K. M., & Lee, J. (1998). Dynamic organisations: Organisational adaptation in a changing environment. Advances in Strategic Management, 15, 269–297. Carroll, G. R. (1984). Organizational ecology. Annual Review of Sociology, 10, 71–93. Casti, J.  (1994). Complexification: Explaining a paradoxical world through the science of surprise. New York: HarperCollins. Castrogiovanni, G. J. (1991). Environmental munificence: A theoretical assessment. The Academy of Management Review, 16(3), 542–565. Cavusgil, S. T., & Zou, S. (1993). Product and promotion adaptation in export ventures: An empirical investigation. Journal of International Business Studies, 24, 479–506. Cavusgil, S. T., & Zou, S. (1994). Marketing strategy performance relationship: An investigation of the empirical link in export market ventures. Journal of Marketing, 58, 1–21. Chaffee, E. E. (1984). Successful strategic management in small private colleges. The Journal of Higher Education, 55(2), 212–241. (The Liberal Arts College: Managing Adaptation to the 1980s (Mar.–Apr., 1984)). Chaffee, E.  E. (1985). Three models of strategy. The Academy of Management Review, 10(1), 89–98. Chakravarthy, B.  S. (1982). Adaptation: A promising metaphor for strategic management. The Academy of Management Review, 7(1), 35–44. Chakravarthy, B. (1986). Measuring strategic performance. Strategic Management Journal, 6, 437–458. Chang, T., & Chuang, C. (1997). Marketing and technology adaptations for international success. International Journal of Business, 2(1). Chen, M. J., Lin, H. C., & Michel, J. G. (2010). Navigating in a hypercompetitive environment: The roles of action aggressiveness and TMT integration. Strategic Management Journal, 31(13).

144

References

Child, J.  (1972). Organizational structure, environment and performance: The role of strategic choice. Sociology: The Journal of the British Sociological Association, 6(1), 1–22. Child, J.  (1985). Managerial strategies, new technology and the labour process. In D.  Knights (Ed.), Job redesign: Critical perspectives on the labour process (pp.  107–141). Aldershot: Gower. Child, J. (1988). On organizations in their sectors. Organization Studies, 9, 13–19. Child, J  (2002): “Strategic choice” In “Organisation” Eds. By Sorge, A., Thompson Learning, Boston, MA. Child, J., & Smith, C. (1987). The context and process of organizational transformation—Cadbury limited in its sector. Journal of Management Studies, 24(6). Christensen, C. M. (2011). The innovator’s dilemma: The revolutionary book that will change the way you do business. New York: Harper Business. Chung, H. F. L. (2003). International standardization strategies: The experience of Australian and New Zealand firms operating in the greater china markets. Journal of International Marketing, 11(3), 48–82. Clark, R.  K. (1990). Scheduling dependent real-time activities. Ph.D. dissertation, School of Computer Science, Carnegie Mellon University, Pittsburgh, PA. Clark, P. (2000). Organisations in action: Competition between contexts. London: Routledge. Clarkson, M. B. E. (1995). A stakeholder framework for analyzing and evaluating corporate social performance. The Academy of Management Review, 20(1), 92–117. CNBC. (2016). Kodak pins its revival hopes new camera phone aimed at camera enthusiasts. Thursday, October 20, 2016. Retrieved March 15, 2017, from http://www.thisismoney.co.uk/ money/markets/article-3558333/Kodak-pins-revival-hopes-new-camera-phone-aimed-older-­ customers.html Cohen, M. D., & Bacdayan, P. (1994). Organizational routines are stored as procedural memory: Evidence from a laboratory study. Organization Science, 5(4), 554–568. Cohen, M. D., Burkhart, R., Dosi, G., Egidi, M., Marengo, L., Warglien, M., & Winter, S. (1996). Routines and other recurring action patterns of organizations: Contemporary research issues. Industrial and Corporate Change, 5, 653–698. Cohen, W. M., & Levinthal, D. A. (1990). Absorptive capacity: A new perspective on learning and innovation. Administrative Science Quarterly, 35(1), 128–152. Cole, R. E. (2011). What Really Happened to Toyota? MIT Sloan Management Review. Retrieved August 29, 2015, from http://sloanreview.mit.edu/article/what-really-happened-to-toyota/ Collinson, S., & Jay, M. (2012). From complexity to simplicity: Unleashed your organisation’s potentials. Basingstoke, UK: Palgrave Macmillan. Collis, D.  J. (1994). Research note: How valuable are organizational capabilities? Strategic Management Journal, 15, 143–152. Collis, D., & Montgomery, C. (1998). Creating corporate advantage. Harvard Business Review, 76(3), 70–83. Commons, J. R. (1932). The problem of correlating law, economics, and ethics. Wisconsin Law Review, 8(1), 3–26. Connelly, B. L., Ketchen, D. J., Jr., & Slater, S. F. (2011). Toward a ‘Theoretical Toolbox’ for sustainability research in marketing. Journal of Academy of Market Science, 39, 86–100. Cooper, A. C., & Dunkelberg, W. C. (1986). Entrepreneurship and paths to business ownership. Strategic Management Journal, 7, 53–68. Cooper, A. C., Willard, G. E., & Woo, C. W. (1986). Strategies of high-performing new and small firms: A re-examination of the niche concept. Journal of Business Venturing, 1, 247–260. Coriat, B., & Dosi, G. (1998). Learning how to govern and learning how to solve problems: On the co-evolution of competences, conflicts, and organizational routines. In A.  Chandler, P. Hagstrom, & O. Solwell (Eds.), The dynamic firm (pp. 103–133). Oxford: Oxford University Press. Court, D. (2015, January). Getting big impact from big data. McKinsey Quarterly. Covin, J. G., & Slevin, D. P. (1988). The influence of organization structure on the utility of an entrepreneurial top management style. Journal of Management Studies, 25, 217–234.

References

145

Covin, J. G., & Slevin, D. P. (1989). Strategic management of small firms in hostile and benign environments. Strategic Management Journal, 10, 75–87. Covin, J. G., & Slevin, D. P. (1991). A conceptual model of entrepreneurship as firm behaviour. Entrepreneurship: Theory and Practice, 16(1), 7–24. Cowan, G.  A. (1994). Conference opening remarks. In G.  A. Cowan, D.  Pines, & D.  Meltzer (Eds.), Complexity: Metaphores, models, and reality (pp. 1–4). Boulder: Westview. Cravens, D. W. (1995). The Changing role of the sales force. Market Management, 4(2). Cravens, D.  W., Piercy, N.  F., & Low, G.  S. (2006). Globalization of the sales organization: Management control and its consequences. Organizational Dynamics, 35(3), 291–303. Cummings, L.  L. (1983). The logics of management. The Academy of Management Review, 8, 532–538. Cyert, R. M., & March, J. G. (1963). A behavioural theory of the firm. Englewood Cliffs: Prentice Hall. Dacin, M. T. (1997). Review-institutions and organizations. Administrative Science Quarterly, 42, 821–824. Dacin, M. T., Goodstein, J., & Scott, R. W. (2002). Institutional theory and institutional change: Introduction to the special research forum. The Academy of Management Journal, 45(1), 43–56. Daft, R. L. (1982). Bureaucratic versus non-bureaucratic structure and the process of innovation and change. In S.  B. Bacharach (Ed.), Research in the sociology of organizations (Vol. 1, pp. 129–166). Greenwich, CT: JAI Press. Daft, R. L. (1992). Organization theory and design (4th ed.). St Paul, MN: West Publishing. Daft, R., & Weick, K. (1984). Toward a model of organizations as interpretation systems. The Academy of Management Review, 9, 284–295. Daft, R. L., & Lewin, A. Y. (1990). Can organization studies begin to breakout of the normal science straitjacket? An editorial essay. Organization Science, 1(1), 1–9. Daft, R. L., & Steers, L. (1985). Organizations: A micro/macro approach. Glenview, IL: Scott, Foresman and Company. Daft, L., & Lengel, R. H. (1986). Organizational information requirements, media richness and structural design. Management Science, 32(5), 554–571. D’Aveni, R.  A. (1994). Hypercompetition: Managing the dynamics of strategic manoeuvring. New York: Free Press. D’Aveni, R. (2010). Beating the commodity trap. Boston, MA: Harvard Business School Press. D’Aveni, R. A., Dagnino, G. B., & Smith, K. G. (2010). The age of temporary advantage. Strategic Management Journal, 31, 1371–1385. Dawson, S. (1979). Organisational analysis and the study of policy formulation and implementation. Public Administration Bulletin, No. 31, pp. 52–68. Dawson, P. (1994a). Organizational change: A processual approach. London: Chapman. Davis, G. F. (2005). Firms and environments. In N. J. Smelser & R. Swedberg (Eds.), Handbook of economic sociology (2nd ed., pp. 478–502). Princeton: Princeton University Press. Davis, G. F., & Cobb, J. A. (2010). Resource dependence theory: Past and future. In S. B. Bacharach (Ed.), Research in the sociology of organizations. London: Elsevier. Day, G. S. (1991). Learning about markets (Marketing Science Institute Report Number 91-117). Cambridge, MA: Marketing Science Institute. Day, G. S. (1994). The capabilities of market-driven organisations. Journal of Marketing, 58(4), 37–52. Day, G. S. (2000). Managing market relationships. Journal of the Academy of Marketing Science, 28(1), 24–30. Day, G. S. (2011). Closing the marketing capabilities gap. Journal of Marketing, 75, 183–195. Debrah, Y.  A., & George, O. (1997). Flexibility, labour subcontracting and HRM in the construction industry in Singapore: Can the system be refined? International Journal of Human Resource Management, 8(5), 690–709. Decarolis, D. M., & Deeds, D. L. (1999). The impact of stocks and flows of organizational knowledge on firm performance: An empirical investigation of the biotechnology industry. Strategic Management Journal, 20(10), 953–968.

146

References

Denison, D. R., & Mishra, A. K. (1995). Toward a theory of organizational culture and effectiveness. Organization Science, 6(2), 204–223. Dess, G.  G., & Beard, D.  W. (1984). Dimensions of organizational task environments. Administrative Science Quarterly, 29, 52–73. Diamantopoulos, A., & Inglis, C. (1988). Identifying differences between high and low involvement exporters. International Marketing Review, 5(2), 52–60. Dickson, P. R. (1996). The static and dynamic mechanics of competition: A comment on hunt and morgan’s comparative advantage theory. Journal of Marketing, 60, 102–106. Dill, W. (1958). Environment as an influence on managerial autonomy. Administrative Science Quarterly, 2(3), 409–443. Dill, W. (1962). The impact of environment on organizational development. In S. Malik & E. H. Van Ness (Eds.), Concepts and issues in administrative behaviour (pp. 94–109). Englewood Cliffs, NJ: Prentice-Hall. DiMaggio, P. J., & Powell, W. W. (1983). The iron cage revisited: Institutional isomorphism and collective rationality in organizational fields. American Sociological Review, 48, 147–160. Doole, I., Grimes, T., & Demack, S. (2006). An exploration of the management practices and processes most closely associated with high levels of export capability in SMEs. Marketing Intelligence & Planning, 24(6), 632–647. Dooley, K.  J. (1997). A complex adaptive systems model of organization change. Nonlinear Dynamics, Psychology, and Life Sciences, 1(1), 69–97. Dooley, K. (2002). Organisational complexity” In “Organisation” Eds. By Sorge, A., Thomson Learning. Doty, D. H. (1990). Context, structure, and strategy: A configurational approach to organizational effectiveness. Unpublished doctoral dissertation, University of Texas at Austin. Doty, D. H., & Glick, W. H. (1989). Construct validity in organizational research: Good news bad news. Paper presented at the national meeting of the Academy of Management, Washington, DC. Doty, H. D., Huber, G. P., & Glick, W. H. (1993). Fit, equifinality, and organizational effectiveness: A test of two configurational theories. The Academy of Management Journal, 36(6), 1196–1250. Doty, D. H., Bhattacharya, M., Wheatley, K. K., & Sutcliffe, K. M. (2006). Divergence between informant and archival measures of the environment: Real differences, artifact, or perceptual error? Journal of Business Research, 59(2), 268–277. Douglas, S. P., & Wind, Y. (1987). The myth of globalization. Columbia Journal of World Business, 22(4), 19–29. Dow, D. (2006). Adaptation and performance in foreign markets. Journal of International Business Studies, 37(2), 212–226. Downs, G. W., & Mohr, L. B. (1976). Conceptual issues in the study of innovation. Administrative Science Quarterly, 21(4), 700–714. Drucker, P. F. (1974). Management: Tasks, responsibilities, practices. New York: Harper and Row. Drazin, R., & Van de Ven, A. H. (1985). Alternative forms of fit in contingency theory. Administrative Science Quarterly, 30(4), 514–539. Dubin, R. (1978). Theory building. New York: Free Press. Duncan, R. B. (1972). Characteristics of organizational environments and perceived environmental uncertainty. Administrative Science Quarterly, 17, 313–327. Dunn, S.  P. (2000). Fundamental uncertainty and the firm in the long run. Review of Political Economy, 12(4), 419–433. Dutta, S., Narasimhan, O., & Rajiv, S. (1999). Success in high-technology markets: Is marketing capability critical? Marketing Science, 18(4), 547–568. Dutta, S., Zbaracki, M. J., & Bergen, M. (2003). Pricing process as a capability: A resource-based perspective. Strategic Management Journal, 24(7), 615–630. Dutton, J. E., & Dukerich, J. M. (1991). Keeping an eye on the mirror: Image and identity in organizational adaptation. The Academy of Management Journal, 34(3), 517–554. Dutton, J. E., Fahey, L., & Narayanan, V. K. M. (1983). Toward understanding strategic issue diagnosis. Strategic Management Journal, 4(4), 307–323.

References

147

Dwyer, R., & Oh, S. (1987). Output sector munificence effects on the internal political economy of marketing channels. Journal of Marketing Research, 24(4), 347–358. Dyer, J. H., & Singh, H. (1998). The relational view: Cooperative strategy and sources of interorganizational competitive advantage. The Academy of Management Review, 23(4), 660–679. Eisenhardt, K. (1989). Making fast strategic decisions in high-velocity environments. The Academy of Management Journal, 32, 543–576. Eisenhardt, K., & Martin, J. (2000). Dynamic capabilities: What are they? Strategic Management Journal, 21(10–11), 1105–1121. Elberse, A., & Ferguson, A. (2013, October). Leading Teams: Ferguson’s Formula. Harvard Businnes Review Magazine. Retrieved June 16, 2015, from https://hbr.org/2013/10/ fergusons-formula/ar/1 Elg, U. (2000). Firms’ home–market relationships: Their role when selecting international alliance partners. Journal of International Business Studies, 31, 169–177. Emery, F.  E., & Trist, E.  L. (1965). The causal texture of organizational environments. Human Relations; Studies Towards the Integration of the Social Sciences, 18, 21–32. Fahey, L., & Narayanan, V. (1986). Macroenvironmental analysis for strategic management. St. Paul, MN: West. Fang, T. (2001). Culture as a driving force for interfirm adaptation: A Chinese case. Industrial Marketing Management, 30, 51–63. Fang, E., & Zou, S. (2009). Antecedents and consequences of marketing dynamic capabilities in international joint venture. Journal of International Business Studies, 40, 742–761. Farhoomand, A.  F. (1987). Scientific progress of management information systems. Database, 18(4), 48–56. Farrell, M. A., & Oczkowski, E. (2002). Are market orientation and learning orientation necessary for superior organizational performance? Working Paper 52/02. Feng, Y. (2010). Toyota Crisis: Management Ignorance?—A Swedish Case of Consumers Perceptions. Master’s dissertation, Management of Innovation and Business Development, Halmstad University School of Business and Engineering. Retrieved December 9, 2015, from http://www.diva-portal.org/smash/get/diva2:349746/fulltext02 Financial Times. (2015). Barclays fires Jenkins after clash over investment banking unit. Retrieved July 8 2015, from http://www.ft.com/cms/s/0/74fed7c6-2537-11e5-9c4e-a775d2b173ca. html#axzz3fOcTRcyx Finkelstein, S. (1997). Inter-industry merger patterns and resource dependence: A replication and extension of Pfeffer (1972). Strategic Management Journal, 18, 787–810. Finkelstein, S., Hambrick, D.  C., & Cannella, A.  A. (2008). Strategic leadership: Theory and research on executives, top management teams, and boards. Oxford, UK: Oxford University Press. Fiol, C. M., & Lyles, M. A. (1985). Organizational learning. The Academy of Management Review, 10(4), 803–813. Fiorina. (2004, December 6). Information: The currency of the digital age. Speech delivered at Oracle Open World, San Francisco. Retrieved October 5, 2015, from http://www.hp.com/ hpinfo/execteam/speeches/fiorina/04openworld.html Fisher, L. (1994). Total quality: Hit or myth? Accountancy, 22(4), 50–51. Floyd, S. W., & Wooldridge, B. (1997). Middle management’s strategic influence and organisational performance. Journal of Management Studies, 34(3), 465–485. Ford, I.  D., Hakansson, H., & Johansson, J.  (1986). How do companies interact? Industrial Marketing and Purchasing, 1(1), 26–41. Ford, J.  D., & Baucus, D.  A. (1987). Organizational adaptation to performance downturns: An interpretation-based perspective. The Academy of Management Review, 12(2), 366–380. Ford, J. D., & Slocum, J. W. (1977). Size, technology, environment, and the structure of organizations. The Academy of Management Review, 2, 561–575. Foster, R. N. (1986). Timing technological transitions. In M. Horwitch (Ed.), Technology in the modern corporation. New York: Pergamon. Freeman, R. E. (1984). Strategic management: A stakeholder approach. Boston: Pitman Publishing.

148

References

Freeman, R.  E., & Mcvea, J.  (2001). A stakeholder approach to strategic management. Working Paper No. 01-02, Darden Graduate School of Business Administration University of Virginia. Retrieved November 3, 2015, from https://papers.ssrn.com/sol3/papers. cfm?abstract_id=263511 Frishammar, J. (2006). Organizational environment revisited: A conceptual review and integration. International Studies of Management and Organisation, 36(3), 22–49. Retrieved from http:// www.jstor.org/stable/40397669?seq=1#page_scan_tab_contents. Fry, A. (1996). Divide and Conquer, Marketing, August, 20–21. Gadde, L. E., & Håkansson, H. (1993). Professional purchasing. London: Routledge. Galbraith, J. R. (1973). Designing complex organizations. Reading, MA: Addison-Wesley. Galbraith, J. R. (1982). Designing complex organizations. Reading, MA: Addison-Wesley. Gasse, Y. (1982). Elaborations on the psychology of the entrepreneur. In C. A. Kent, D. L. Sexton, & K. H. Vesper (Eds.), Encyclopedia of entrepreneurship (pp. 209–223). Englewood Cliffs, NJ: Prentice Hall. Geertz, C. (1973). The interpretation of culture. New York: Basic Books. Gersick, C. J. G. (1991). Revolutionary change theories: A multilevel exploration of the punctuated equilibrium paradigm. The Academy of Management Review, 16, 10–36. Ghoshal, S., & Bartlett, C. A. (1994). Linking organizational context and managerial action: The dimensions of quality of management. Strategic Management Journal, 15, 91–112. Ghoshal, S., & Moran, P. (1996). Bad for practice: A critique of the transaction cost theory. The Academy of Management Review, 21(1), 13–47. Gioia, D.  A. (1992). Pinto fires and personal ethics: A script analysis of missed opportunities. Journal of Business Ethics, 11, 379–389. Gioia, D. A., & Pitre, E. (1990). Multiparadigm perspectives on theory building. The Academy of Management Review, 15(4), 584–602. Gibson, C. B., & Birkinshaw, J. (2002). Contextual determinants of organizational ambidexterity. Centre for Effective Organisations, Marshall School of Business, University of South California, Los Angeles. Retrieved February 2, 2015, from http://ceo.usc.edu/pdf/T015395.pdf Giddens, A. (1979). Central problems of social theory. London: McMillan. Giddens, A. (1991). Modernity and self-identity. Stanford, CA: Stanford University Press. Gluck, F., Kaufman, S., & Walleck, A. S. (1982). The four phases of strategic management. Journal of Business Strategies, 2(3), 9–21. Gluesing, J. C., & Gibson, C. (2004). Designing and forming global teams. In H. C. Lane, M. L. Maznevski, M. Mendenhall, & J. McNett (Eds.), The blackwell handbook of global management: A guide to managing complexity (pp. 199–226). Oxford: Blackwell Publishing. Godkin, L., & Allcorn, S. (2008). Overcoming organizational Inertia: A tripartite model for achieving strategic organizational change. The Journal of Applied Business and Economics, 8(1), 82–94. Golden, B., & R. (1992). SBU strategy and performance: The moderating effect of the corporate-­ SBU relationship. Strategic Management Journal, 13(2), 145–158. Grant, R. B. (1991). A resource based theory of competitive advantage: Implications for strategy formulation. California Management Review, 33(3), 114–135. Grant, R. (1996). Prospering in dynamically-competitive environments: Organizational capability as knowledge integration. Organization Science, 7(4), 375–387. Grant, K., & Cravens, D.  W. (1996). Examining salesforce performance in organizations that use behaviour-based sales management processes. Industrial Marketing Management, 25(5), 361–371. Grant, R.  M., & Neupert, K.  E. (2000). Cases in contemporary strategy analysis (Second ed.). Malden, MA: Blackwell. Greenwald, H. J. (1969). Dissonance and relative versus absolute attractiveness of decision alternatives. Journal of Personality and Social Psychology, 11(4), 328–333. Grewal, R., & Tansuhaj, P. (2001). Building organizational capabilities for managing economic crisis: The role of market orientation and strategic flexibility. Journal of Marketing, 65(2), 67–80. Guenzi, P., Sajtos, L., & Troilo, G. (2016). The dual mechanism of sales capabilities in influencing organizational performance. Journal of Business Research, 69, 3707–3713.

References

149

Gwin, C. R. (2001). The firm and managerial misdirection of worker effort. Economic Inquiry, 39(1), 17–29. Hagberg-Andersson, A. (2006). Does adaptation pay off? Industrial Marketing Management, 35, 202–209. Hage, J. (1980). Theories of organizations. New York: Wiley. Håkansson, H., Ford, D., & Johansson, J. (1999). How should companies interact? Proceedings of the 15th IMP Conference, Dublin, Ireland. Hall, R. (1993). A framework linking intangible resources and capabilities to sustainable competitive advantage. Strategic Management Journal, 14(8), 607–618. Hall, M. L. E., Lengnick, C. A. L., Andrade, L. S., & Drake, B. (2009). Strategic human resource management: The evolution of the field. Human Resource Management Review, 19(2), 64–85. Hallén, L., Johanson, J., & Seyed-Mohamed, N. (1991). Interfirm adaptation in business relationships. Journal of Marketing, 55(2), 29–37. Hambrick, D.  C. (1983). Some tests of the effectiveness and functional attributes of miles and snow’s strategic types. The Academy of Management Journal, 26, 2–26. Hambrick, D. C., & Fredrickson, J. W. (2001). Are you sure you have a strategy? The Academy of Management Executive, 15(4.) (Reprinted in 2005, 19(4), 51–62). Hamel, G. (1999). Bringing the valley inside. Harvard Business Review, 77(5), 70–86. Hamel, G., Doz, Y.  L., & Prahalad, C.  K. (1989). Collaborate with your competitors-and win. Harvard Business Review, 67(1), 133–139. Hamel, G., & Prahalad, C. K. (1994). Competing for the future. Boston, MA: Harvard Business School Press. Han, J.  K., Kim, N., & Srivastava, R.  K. (1998). Market orientation and organizational performance: Is innovation a missing link? journal of marketing, 62(4), 30–45. Hannan, M.  T., & Freeman, J.  (1977). The population ecology of organizations. The American Journal of Sociology, 82(5), 929–964. Hannan, M. T., & Freeman, J. (1984). Structural inertia and organizational change. American Sociological Review, 49(2), 149–164. Hannan, M. T., & Freeman, J. (1989). Organizational ecology. Cambridge: Harvard University Press. Hannan, M. T., & Freeman, J. (1984). Structural inertia and organizational change, American Sociological Review, 49(2), 149–164. Harrigan, K. R. (1985). Strategies for joint ventures. Lexington, MA: Lexington Books. Harrigan, K. R., & Newman, W. H. (1990). Bases of inter-organisation co-operation: Propensity, power, persistence. Journal of Management Studies, 27, 417–434. Harrison, J. R., & Carroll, G. R. (1991). Keeping the faith: A model of cultural transmission in formal organizations. Administrative Science Quarterly, 36(4), 552–582. Hart, S.  L. (1995). A natural-resource-based view of the firm. The Academy of Management Review, 20(4), 986–1014. Harvey, J., & Weary, G. (1981). Perspectives on attributional processes. Dubuque, IA: Brown. Hatten, K. J. (1979). Quantitative research methods in strategic management. In D. E. Schendel & C.  W. Hofer (Eds.), Strategic management: A new view of business policy and planning (pp. 448–467). Boston: Little, Brown. Hayek, F. (1945). The use of knowledge in society. The American Economic Review, 35, 519–530. Hayes, R., Wheelwright, S., & Clark, K. (1988). Dynamic manufacturing: Creating the learning organization. New York: Free Press. Hazlett, S., McAdam, R., & Gallagher, S. (2005). Theory building in knowledge management in search of paradigms. Journal of Management Inquiry, 14(1), 31–42. Hedberg, B. L. T. (1981). How organizations learn and unlearn. In P. C. Nystrom & W. H. Starbuck (Eds.), Handbook of organizational design (pp. 3–27). Oxford: Oxford University Press. Hedberg, B.  L. T., & Ericson, A. (1997). Insiktströghet och manövertröghet i organisationers omorientering [Insight inertia and action inertia in organizational reorientation]. In B.  L. T. Hedberg & S. E. Sjöstrand (Eds.), Från företagskriser till industripolitik [From organizational crisis to industrial politics] (pp. 54–66). Malmö: Liber.

150

References

Hedberg, B., Nystrom, P., & Starbuck, W. (1976). Camping on seesaws: Prescriptions for a self-­ designing organization. Administrative Science Quarterly, 21, 41–65. Hedberg, B., & Wolff, R. (2003). Organizing, learning, and strategizing: From construction to discovery. In M. Dierkes, A. Berthoin Antal, J. Child, & I. Nonaka (Eds.), Handbook of organizational learning & knowledge (pp. 35–556). Oxford: Oxford University Press. Hedlund, G. (1994). A model of knowledge management and the N-form corporation. Strategic Management Journal, 15, 73–90. Helfat, C. E. (1997). Know-how and asset complementarity and dynamic capability accumulation: The case of R&D. Strategic Management Journal, 18(5), 339–360. Helfat, C. E., & Peteraf, M. A. (2003). The dynamic resource based view: Capability lifecycles. Strategic Management Journal, 24, 997–1010. Helfat, C. E., Finkelstein, S., Mitchell, W., Peteraf, M., Singh, H., Teece, D., & Winter, S. (2007). Dynamic capabilities: Understanding strategic change in organizations. London: Blackwell. Helfat, C. F., & Peteraf, M. A. (2015). Managerial cognitive capabilities and the micro-foundations of dynamic capabilities. Strategic Management Journal, 36(6), 831–850. Heifetz, R.  A., & Laurie, D.  L. (1997, January–February). The work of leadership. Harvard Business Review, pp. 124–34. Henderson, R. M., & Clark, K. B. (1990). Architectural innovation: The reconfiguration of existing product technologies and the failure of established firms. Administrative Science Quarterly, 35(1), 9–30. (Special Issue: Technology, Organizations, and Innovation (Mar., 1990)). Henderson, R., & Cockburn, I. (1994). Measuring competence? Exploring firm effects in pharmaceutical research. Strategic Management Journal, 15, 63–84. Hess, E. D. (2015, May). Learn or die: Every business will be in the business of learning. The European Business Review, Weekly Newsletter. Retrieved September 13, 2015, from http:// www.europeanbusinessreview.com/?p=7418 Heylighen, F. (1989). Self-organization, emergence and the architecture of complexity. In: Proceedings of the 1st European Conference on System Science, AFCET, Paris, pp. 23–32. Hickson, D., Butler, R., Cray, D., Mallory, G., & Wilson, D. (1986). Top decisions: Strategic decision making in organizations. San Francisco: Jossey-Bass. Hill, J. S. (1980). Product and promotion adaptations in lesser-developed countries. Doctoral dissertation, Georgia State University. (Dissertation Abstracts International, 41, 262). Hill, J.  S., & Still, R.  R., (1984a, March–April): Adapting products to LDC tastes. Harvard Business Review, pp. 92–101. Hill, J. S., & Still, R. R., (1984b, Summer). Effects of urbanization on multinational product planning: Markets in LDCs. Columbia Journal of World Business, pp. 62–67. Hilliard, R. (2004). Tacit knowledge and dynamic capability: The importance of penrosian image. Paper presented at the DRUID Summer Conference 2004 on Industrial Dynamics, Innovation And Development Elsinore, Denmark, June 14–16, 2004. Hillman, A. J., Withers, M. C., & Collins, B. J. (2009). Resource dependence theory: A review. Journal of Management, 35(6), 1404–1427. Hirsch, P., & Lounsbury, M. (1997). Ending the family quarrel: Toward a reconciliation of “Old” and “New” institutionalisms. The American Behavioral Scientist, 40, 406–418. Hofer, W., & Schendel, D. (1978). Strategy formulation: Analytical concepts. St. Paul, MN: West. Hoffman, A. (1997). From Heresy to Dogma: An institutional history of corporate environmentalism. San Francisco: New Lexington Press. Hoffman, A. J. (1999). Institutional evolution and change: Environmentalism and the U.S. Chemical Industry. The Academy of Management Journal, 42(4), 351–371. Hoffman, A., & Ventresca, M. (1999). The institutional framing of policy debates: Economics versus the environment. The American Behavioral Scientist, 42, 1369–1393. Hofstede, G. (1991). Cultures and organizations. New York: McGraw-Hill. Hofstede, G., & Bond, M. H. (1988). The confucius connection: From cultural roots to economic growth. Organizational Dynamics, 16(4), 4–21. Holland, J. H. (1992). Adaptation in natural and artificial systems. Cambridge, MA: MIT Press. Holland, J. H. (1995). Hidden order. Reading, MA: Addison-Wesley.

References

151

Holma, A. (2009). Adaptation in triadic business relationship settings: A study in corporate travel management. Doctoral thesis, Publications of Hanken School of Economics 207. Hrebiniak, L. G., & Joyce, W. F. (1985). Organizational adaptation: Strategic choice and environmental determinism. Administrative Science Quarterly, 30(1985), 336–349. Huber, G.  P. (1991). Organisational learning: The contributing processes and the literatures. Organization Science, 2(1), 88–115. Huerta, E., & Sanchez, P. J. (1999). Evaluation of Information technology: Strategies in spanish firms. European Journal of Information Systems, 8, 273–283. Hult, G. T. M., Hurley, R. F., & Knight, G. A. (2004). Innovativeness: Its antecedents and impact on business performance. Journal of Industrial Marketing Management, 33, 429–438. Hunt, J. W. (1992). Managing people at work: A manager’s guide to behaviour in organisations (3rd ed.). McGraw Hill. Hunt, S. D. (2000). A general theory of competition. Thousand Oaks, CA: Sage. Hunt, S. D., & Morgan, R. M. (1996). The resource-advantage theory of competition: Dynamics, path dependencies, and evolutionary dimensions. Journal of Marketing, 60, 107–114. Huy, Q. N. (2001). Time, temporal capability, and planned change. The Academy of Management Review, 26, 601–623. Illinitch, A. Y., Lewin, A. Y., & D’Aveni, R. (1998). New organizational forms and strategies for managing in hypercompetitive environments. In Managing in times of disorder: Hypercompetitive organizational responses. Thousand Oaks, CA: Sage Publications. (Introduction xxi–xxxiv). Ireland, R. D., Hitt, M. A., Bettis, R. A., & DePorras, D. A. (1987). Strategy formulation processes: Differences in perceptions of strength and weakness indicators and environmental uncertainty by managerial level. Strategic Management Journal, 8, 467–485. Istocescu, A. (2006). Intreprenoriat şi intraprenoriat în România (pp. 67–85). Editura ASE. 976. Jabnoun, N., Khalifah, A., & Yusuf, A. (1990). Environmental uncertainty, strategic orientation, and quality management: A contingency model. The Quality Management Journal, 10(4), 17. Jackson, S.  E., & Dutton, J.  E. (1988). Discerning Threats and Opportunities. Administrative Science Quarterly, 33(3), 370–387. Jacobs, D. (1974). Dependency and Vulnerability: An exchange approach to the control of organizations. Administrative Science Quarterly, 19, 45–59. Jacobson, R. (1992). The ‘Austrian’s school of strategy. The Academy of Management Review, 17, 782–807. Janis, I. L. (1972). Victims of groupthink. Boston: Houghton Mifflin. Jaques, E. (1982). The form of time. New York: Crane and Russak. Jarzabkowski, P. (2004). Strategy as practice: Recursiveness, adaptation, and practices-in-use. Organization Studies, 25(4), 529–560. Jaworski, B. J., & Kohli, A. K. (1993). Market orientation: Antecedents and consequences. Journal of Marketing, 57(3), 53–70. Johanson, J., & Mattson, L.  G. (1987). Interorganizational relations in industrial systems: A network approach compared with the transaction cost approach. International Studies of Management and Organization, 17(1), 34–48. Johnson, G. (1987). Strategic change and the management process. Oxford: Basil Blackwell. Johnson, G., & Huff, A. S. (1998). Everyday innovation/everyday strategy’ in strategic flexibility: Managing in a turbulent environment. In G. Hamel, C. K. Prahalad, H. Thomas, & D. O’Neal (Eds.), (pp. 13–27). Chichester and New York: Wiley. Johnston, W. J., Leach, M. P., & Liu, A. H. (1999). Theory testing using case studies in business-­ to-­business research. Industrial Marketing Management, 28(3), 201–213. Jones, T. M. (1995). Instrumental Stakeholder Theory: A Synthesis of Ethics and Economics. The Academy of Management Review, 20(2), 404–437. Jurczyk, K. (1998). Time in women’s everyday lives: Between self-determination and conflicting demands. Time and Society, 7, 283–308. Kacker, M.  P. (1972). Patterns of marketing adaptation in international business. Management International Review, 12, 111–118. Kahneman, D., & Tversky, A. (1979). Prospect theory: An analysis of decision under risk. Econometrica, 47(2), 263–292.

152

References

Kaplan, S., Murray, F., & Henderson, R. (2003). Discontinuities and top management: Assessing the role of recognition in pharmaceutical firm response to biotechnology. Industrial and Corporate Change, 12, 203–234. Karande, K., Almurshidee, K. A., & Al-Olayan, F. (2006). Advertising standardisation in culturally similar markets: Can we standardise all components? International Journal of Advertising, 25(4), 489–512. Karim, S., & Mitchell, W. (2000). Path-dependent and path-breaking change: Reconfiguring business resources following acquisitions in the U.S.  Medical Sector, 1978–1995. Strategic Management Journal, 21(10/11), 1061–1081. (Special Issue: The Evolution of Firm Capabilities (Oct.–Nov., 2000)). Kaufmann, S. A. (1995). At home in the universe. London: Penguin. Kauffman, S. A. (1993). The origins of order: Self organization and selection in evolution. New York: Oxford University Press. Kimberly, J.  R. (1981). Managerial innovation. In P.  C. Nystrom & W.  H. Starbuck (Eds.), Handbook of organizational design (Vol. 1, pp. 84–104). New York: Oxford University Press. Kindström, D., Kowalkowski, C., & Sandberg, E. (2013). Enabling service innovation: A dynamic capabilities approach. Journal of Business Research, 66(8), 1063–1073. doi:10.1016/j. jbusres.2012.03.003. King, A. W., & Zeithalm, C. P. (2003). Measuring organizational knowledge: A conceptual and methodological framework. Strategic Management Journal, 24(8), 763–772. Kluckhohn, C. (1962). Culture and behaviour. New York: Free Press. Knight, F. H. (1921). Risk, uncertainty, and profit. New York: Houghton and Mifflin. Knoppen, D., & Christiaanse, E. (2007). Interorganizational adaptation in supply chains: A behavioural perspective. The International Journal of Logistics Management, 18(2), 217–237. Koberg, C. S. (1987). Resource scarcity, environmental uncertainty, and adaptive organizational behaviour. The Academy of Management Journal, 30(4), 798–807. Kogut, B., & Zander, U. (1992). Knowledge of the firm, combinative capabilities, and the replication of technology. Organization Science, 3(3), 383–397. Kohli, A. K., & Jaworski, B. J. (1990). Market orientation: The construct, research propositions, and managerial implications. Journal of Marketing, 54(2), 1–18. Kohli, A. K., Jaworski, B. J., & Kumar, A. (1993). MARKOR: A measure of market orientation. Journal of Marketing Research, 30, 467–477. Komori, S. (2015). Innovating out of crisis: How Fujifilm survived (and Thrived) as its core business was vanishing. Berkeley, CA: Stone Bridge Press. Kostova, T. (1999). Transnational transfer of strategic organizational practices: A contextual perspective. The Academy of Management Review, 24, 308–324. Kotabe, M. (1998). Efficiency vs. effectiveness orientation of global sourcing strategy: A comparison of U.S. and Japanese Multinational Companies. The Academy of Management Executive, 12, 107–119. Kotler, P., & Armstrong, G. (1996). Principles of marketing. Englewood Cliffs, NJ: Prentice Hall. Kotter, J. P. (2008). A sense of urgency. Boston, MA: Harvard Business School Press. Kotter, J. (2012). Leading change (New ed.). Boston, MA: Harvard Business Review. Kransdorff, A. (1998). Corporate Amnesia: Keeping know-how in the company. London: Butterworth-Heinemann. Kropp, F., Lindsay, N. J., & Shoham, A. (2006). Entrepreneurial, market, and learning orientations and international entrepreneurial business venture performance in south african firms. International Marketing Review, 23(5), 504–523. Kumar, V., Jones, E., Venkatesan, R., & Leone, R.  P. (2011). Is market orientation a source of sustainable competitive advantage or simply the cost of competing? Journal of Marketing, 75, 16–30. Lambkin, M., & Day, G. (1989). Evolutionary processes in competitive environments: Beyond the product life cycle. Journal of Marketing, 53(3), 4–20. Lavie, D. (2006). The competitive advantage of interconnected firms: An extension of the resource-­ based view. The Academy of Management Review, 31(3), 638–658.

References

153

Lawrence, P., & Lorsch, J. (1967). Organizations and environment. Cambridge: Harvard University Press. Lawrence, P.  R. (1981). The harvard organization and environment research program. In H. Andrew, V. de Ven, & W. F. Joyce (Eds.), Perspectives on organization design and behaviour (pp. 311–337). New York: Wiley Interscience. Lee, C., Lee, K., & Pennings, J.  M. (2001). Internal capabilities, external networks, and performance: A study on technology-based ventures. Strategic Management Journal, 22(6/7), 615–640. (Special Issue: Strategic Entrepreneurship: Entrepreneurial Strategies for Wealth Creation). Lee, C. C., & Yang, J. (2000). Knowledge value chain. The Journal of Management Development, 19(9), 783–793. Lee, C. H., Venkatraman, N., Tanriverdi, H., & Iyer, B. (2010). Complementarity-based hypercompetition in the software Industry: Theory and empirical test, 1990–2002. Strategic Management Journal, 31(13). Leonard-Barton, D. (1988). Implementation as mutual adaptation of technology and organization. Research Policy, 17, 251–267. Leonard-Barton, D. (1992). Core capabilities and core rigidities: A paradox in managing new product development. Strategic Management Journal, 13, 11. Leonidou, L. C. (1996). Product STandardization or adaptation: The Japanese approach. Journal of Marketing Practice, 2, 53–74. Liesch, P. W., Welch, L. W., & Buckley, P. J. (2011a). Risk and uncertainty in internationalisation and international entrepreneurship studies. Management International Review, 51, 851–873. Lin, Z., & Hui, C. (1997). Adapting to the changing environment: A theoretical comparison of decision making proficiency of lean and mass organization systems. Computational & Mathematical Organization Theory, 3(2), 113–142. Levine, S., & White, P. (1961). Exchange as a conceptual framework for the study of inter-­ organizational relationships. Administrative Science Quarterly, 5(3), 583–601. Levitt, T. (1983). The globalization of markets. Harvard Business Review, 61, 92–102. Levitt, B., & March, J.  M. (1988). Organisational learning. Annual Review of Sociology, 14, 319–340. Lewis, M.  W., & Grimes, A.  J. (1999). Metatriangulation: Building theory from multiple paradigms. The Academy of Management Review, 24(4), 672–690. Lewis, M. W., & Kelemen, M. L. (2002). Multiparadigm inquiry: Exploring organizational pluralism and paradox. Human Relations; Studies Towards the Integration of the Social Sciences, 55(2), 251–275. Lewin, R. (1999). Complexity: Life at the edge of chaos. The University of Chicago Press. Lewin, R., & Regine, B. (1999). On the edge in the world of business. In R. Lewin (Ed.), Complexity: Life at the edge of chaos (pp. 197–211). Chicago: The University of Chicago Press. Li, T., & Calantone, R. J. (1998). The impact of market knowledge competence on new product advantage: Conceptualization and empirical examination. Journal of Marketing, 62(4), 13–29. Lieberman, M., & Montgomery, D. (1988). First-mover advantages. Strategic Management Journal, 9, 41–58. Liesch, P. W., Welch, L. S., & Buckley, P. J. (2011b). Studies: Review and conceptual development. Management International Review, 51, 851–873. Lin, Z., & Hui, C. (1999). Should lean replace mass organization systems? A comparative examination from a management coordination perspective. Journal of International Business Studies, 30(1), 45–79. Lippman, S. A., & Rumelt, R. P. (1982). Uncertain imitability: An analysis of interfirm differences in efficiency under competition. Bell Journal of Economics, 13(2), 418–438. Locke, E. A. (1976). The nature and causes of job satisfaction. In M. D. Dunnette (Ed.), Handbook of industrial and organizational psychology (pp. 1297–1349). Chicago, IL: Rand McNally. Loyka, J. J., & Powers, T. L. (2003). A model of factors that influence global product standardization. Journal of Leadership and Organizational Studies, 10, 64–72. Lumpkin, G. T., & Dess, G. G. (1996). Clarifying the entrepreneurial orientation construct and linking it to performance. The Academy of Management Review, 21(1), 135–172.

154

References

Maclean, D., Maclntosh, R., & Siedl, D. (2015). rethinking dynamic capabilities from a creative action perspective. Strategic Organization, 13(4), 340–352. MacMillan, I. C., & Jones, P. E. (1984). Designing organizations to compete. Journal of Business Strategies, 4, 11–26. Mahoney, T. J., & Pandian, J. R. (1992). The resource-based view within the conversation of strategic management. Strategic Management Journal, 13(5), 363–380. Maier, V., & Zenovia, C.  P. (2011). Entrepreneurship versus intrapreneurship. Review of International Comparative Management, 12(5), 971–976. Maignan, I., Gonzalez-Padron, T.  L., Hult, T.  M., & Ferrel, O.  C. (2011). Stakeholder orientation: Development and testing of a framework for socially responsible marketing. Journal of Strategic Marketing, 19(4), 313–338. Makadok, R. (2001). Toward a synthesis of the resource-based and dynamic-capability views of rent creation. Strategic Management Journal, 22(5), 387–401. March, J. G. (1991). Exploration and exploitation in organizational learning. Organization Science, 2(1), 71–78. March, J. G., & Olsen, J. P. (1984). The new institutionalism: Organizational factors in political life. The American Political Science Review, 78(3), 734–749. Manning, G., L, Ahearne, M., and Reece, B. L. (2012). “Selling today: Partnering to create value”, International Edition, Twelfth Edition, Pearson. Manu, F. A., & Sriram, V. (1996). Innovation, marketing strategy, environment, and performance. Journal of Business Research, 35(1), 79–91. Marcus, A. A., & Nichols, M. L. (1999). On the edge: Heeding the warnings of unusual events. Organization Science, 10(4), 482–499. Mariadoss, B.  J., Tansuhaj, P.  S., & Mouri, N. (2011). Marketing capabilities and innovation-­ based strategies for environmental sustainability: An exploratory investigation of B2B firms. Industrial Marketing Management, 40, 1305–1318. Markovsky, B. (1992). Network exchange outcomes: Limits of predictability. Social Networks, 14, 267–286. Martelo, S., Barroso, C., & Cepeda, G. (2013). The use of organizational capabilities to increase customer value. Journal of Business Research, 66, 2042–2050. Massa, S., & Testa, S. (2009). A knowledge management approach to organizational competitive advantage: Evidence from the food sector. European Management Journal, 27, 129–141. Mathews, K. M., White, M. C., & Long, R. G. (1999). Why study complexity sciences in the social sciences? Human Relations; Studies Towards the Integration of the Social Sciences, 52(4), 439–462. Maznevski, M., Steger, U., & Amann, W. (2007). Managing complexity. Hoboken, NY: Wiley. McDaniel, S. W., & Kolari, J. W. (1987). Marketing strategy implications of the miles and snow strategic typology. Journal of Marketing, 51(4), 19–30. McDonald, M., & Wilson, H. (2011). Marketing plans: How to prepare them, how to use them (7th ed.). Wiley. McGrath, J. E., & Kelly, J. R. (1986a). Time and human interaction. New York: Guilford. McKee, D. O., Varadarajan, P. R., & Pride, W. (1989). Strategic adaptability and firm performance: A market contingent perspective. Journal of Marketing, 53(3), 21–35. McKelvey, B. (1997). Quasi-natural organization science. Organization Science, 8(4), 352–380. McKelvey, B., & Aldrich, H. (1983). Populations, natural selection, and applied organizational science. Administrative Science Quarterly, 28(1), 101–128. McKinley, W. (1984). Organizational decline and innovation in manufacturing. In B. Bozeman, M. Crow, & A. Link (Eds.), Strategic management of industrial R&D (pp. 147–159). Lexington, MA: Lexington Books. Meeus, M. T. H., & Oerlemans, L. A. G. (2000). Firm behaviour and innovative performance an empirical exploration of the selection–adaptation debate. Research Policy, 29, 41–58. Meyer, J. W., & Rowan, B. (1977). Institutional organizations: Formal structure as myth and ceremony. The American Journal of Sociology, 83, 340–363. Meyer, J. W., & Rowan, B. (1978). The structure of educational organizations. In M. W. Meyer (Ed.), Environments and organizations (pp. 78–109). San Francisco: Jossey-Bass.

References

155

Meyer, J. W., & Scott, W. R. (Eds.). (1983). Organizational environments: Ritual and rationality. Beverly Hills, CA: Sage. Meyer, A., Frost, P., & Weick, K. (1998). Overture—The Organization Science Jazz Festival: Improvisation as a metaphor for organizing. Organization Science, 9(5), 569–576. Meyerson, D., & Martin, J. (1987). Cultural change: An integration of three different views [1]. Journal of Management Studies, 24(6), 623–647. McGrath, J. E., & Kelly, J. R. (1986b). Time and human interaction: Toward a social psychology of time. New York: Guildford Press. Miao, C. F., & Evans, K. R. (2013). The interactive effects of sales control systems on salesperson performance: A job demands–resources perspective. Journal of the Academy of Marketing Science, 41(1), 73–90. Miles, R., Snow, C., & Pfeffer, J.  (1974). Organization–environment: Concepts and issues. Industrial Relations, 13, 244–264. Miles, R. E., & Snow, C. C. (1978). Organizational strategy, structure and process. New York: McGraw-Hill. Miles, R. E., Snow, C. C., Meyer, A. D., & Coleman, H. J., Jr. (1978). Organization strategy, structure, and process. The Academy of Management Review, 3(3), 546–562. Miles, R. H., & Cameron, K. S. (1977). Coffin nails and corporate strategies. Working Paper No. 3, School of Organization and Management, Yale University. Miles, R. H., & Cameron, K. (1982). Coffin nails and corporate strategies. Englewood Cliffs, NJ: Prentice-Hall. Miles, R. E., Miles, G., & Snow, C. (1998). Good for practice: An integrated theory of the value of alternative organisational forms. In G. Hamel, C. K. Prahalad, H. Thomas, & D. O’Neal (Eds.), Strategic flexibility: Managing in a turbulent environment (pp. 92–114). Chichester and New York: Wiley. Milgrom, P.  R., & Roberts, I. (1992). Economics, organisation and management. Englewood Cliffs, NJ: Prentice Hall. Miller, D. (1982). Evolution and revolution: A quantum view of structural change in organizations. Journal of Management Studies, 19, 2. Miller, D. (1983). The correlates of entrepreneurship in three types of firms. Management Science, 29, 770–791. Miller, D., & Friesen, P. H. (1984). A longitudinal study of the corporate life cycle. Management Science, 30(10), 1161–1183. Miller, D., & Friesen, P.  H. (1978). Archetypes of strategy formulation. Management Science, 24(9), 921–933. Miller, D., & Friesen, P. H. (1980). Momentum and revolution in organizational adaptation. The Academy of Management Journal, 23(4), 591–614. Miller, D., & Friesen, P. H. (1983). Successful and unsuccessful phases of the corporate life cycle. Organization Studies, 4(4), 339–356. Miller, A., & Camp, B. (1985). Exploring determinants of success in corporate ventures. Journal of Business Venturing, 1(2), 87–105. Miller, D. (1990). Organizational configurations: Cohesion, changes, and prediction. Human Relations, 43, 771–789. Miller, D. (1993). The architecture of simplicity. The Academy of Management Review, 18, 116–138. Miller, D., & Shamsie, J. (1999). Strategic responses to three kinds of uncertainty: Product line simplicity at the hollywood film studios. Journal of Management, 25, 97–116. Milliken, F. J. (1987). Three types of perceived uncertainty about the environment: State, effect, and response uncertainty. The Academy of Management Review, 12, 133–143. Milliken, F. J. (1990). Perceiving and interpreting environmental change: An examination of college administrators’ interpretation of changing demographics. The Academy of Management Journal, 33(1), 42–63. Mintzberg, H. (1973). The nature of managerial work. New York: Harper & Row. Mintzberg, H. T. (1979). The structuring of organizations. Englewood Cliffs, NJ: Prentice-Hall. Mintzberg, H. T. (1983). Structure in fives: Designing effective organizations. Englewood Cliffs, NJ: Prentice-Hall.

156

References

Mintzberg, H. T. (1989). Mintzberg on management: Inside our strange world of organizations. New York: Free Press. Mishra, A., & Dwivedi, Y. K. (2012). Stakeholder theory and applications in information systems. In Y. K. Dwivedi, M. R. Wade, S. L. Schneberger, R. Series Editors Sharda, & S. Voß (Eds.), Information system theory: Explaining and predicting our digital society, Integrate series in information system (Vol. 28, 1st ed., pp. 471–488). Mitchell, R.  K., Agle, B.  R., & Wood, D.  J. (1997). Toward a theory of stakeholder identification and salience: Defining the principle of who and what really counts. The Academy of Management Review, 22(4), 853–886. Mitleton-Kelly, E. (2003). Ten principles of complexity and enabling infrastructures. In E. MitletonKelly (Ed.), Complex systems and evolutionary perspectives on organizations: The application of complexity theory to organizations (pp. 23–50). Amsterdam: Pergamon. Mitrega, M., Forkmann, S., Ramos, C., & Henneberg, S.  C. (2012). Networking capability in business relationships—Concept and scale development. Industrial Marketing Management, 41, 739–751. Moore, J. F. (1998). The rise of a new corporate form. The Washington Quarterly, 21(1), 167–181. Morel, B., & Ramanujam, R. (1999). Through the looking glass of complexity: The dynamics of organizations as adaptive and evolving systems. Organization Science, 10(3), 278–293. Morgan, G. (1979). Response to Mintzberg. Administrative Science Quarterly, 24(1), 137–139. Morgan, G. (1980). Paradigms, metaphors, and puzzle solving in organization theory. Administrative Science Quarterly, 25(4), 605–622. Morgan, G. (2011). Reflections on images of organization and its implications for organization and environment. Organization & Environment, 24(4), 459–478. Morgan, R., & Hunt, S. (1994). The commitment-trust theory of relationship marketing. Journal of Marketing, 58(3), 20–38. Morgan, G., & Sturdy, A. (2000). Beyond organisational change: Structure, discourse and power in UK Financial Services. London: Macmillan. Morgan, N. A., Vorhies, D. W., & Mason, C. H. (2009). Market orientation, marketing capabilities, and firm performance. Strategic Management Journal, 30, 909–920. Morozov, B., & Morris, R. J. (2009). Kodak’s challenge: Surviving the disruptive winds of change. Business Case Journal, 16(2), 21–45. Morrison, E. W., & Milliken, F. J. (2000). Organizational silence: A barrier to change and development in a pluralistic world. The Academy of Management Review, 25(4), 706–725. Morrow, S., & Howieson, B. (2014). The new business of football: A study of current and aspirant football club managers. Journal of Sport Management, 28(5), 515–528. Mukherji, A., & Francis, J. D. (2008). Mutual adaptation in buyer–supplier relationships. Journal of Business Research, 61(2), 154–161. Mullins, L. J., Christy, G., & Scott, P. (2013). Management and organisational behaviour (10th ed.). Pearson. Nahapiet, J., & Ghoshal, S. (1998). Social capital, intellectual capital and the organizational advantage. The Academy of Management Review, 23(2), 242–266. Nath, P., Nachiappan, S., & Ramanathan, R. (2010). The impact of marketing capability, operations capability and diversification strategy on performance: A resource-based view. Industrial Marketing Management, 39, 317–329. Narver, J. C., Slater, S. F., & Maclachlan, D. L. (2004). Responsive and proactive market orientation and new-product success. Journal of Product Innovation Management, 21, 334–347. Neil, S., McKee, D., & Rose, G. M. (2007). Developing the organization’s sensemaking capability: Precursor to an adaptive strategic marketing response. Industrial Marketing Management, 36, 731–744. Nelsen, J. T. II (1987). “Auftragstaktik”: A case for decentralized battle. Retrieved April, 2016, from http://www.dtic.mil/dtic/tr/fulltext/u2/a509971.pdf Nelson, R. R., & Winter, S. G. (1982). An evolutionary theory of economic change. Cambridge, MA: Harvard Business School Press. Newell, A. (1962). Some problems of basic organization in problem-solving programs. In M. C. Yovits, G. T. Jacobi, & G. D. Goldstein (Eds.), Proceedings of the second conference on self-­ organizing systems. Chicago: Spartan Books.

References

157

Nicholls-Nixon, C. (2000). Self-organization and the sustainability of rapid growth: An agenda for future research. Richard Ivey School of Business working paper. Nonaka, I. (1994). Dynamic theory of organizational knowledge creation. Organization Science, 5(1), 14–37. Nonaka, I., & Takeuchi, H. (1995). The knowledge creating company: How Japanese companies create the dynamics of innovation. New York: Oxford University Press. Orlikowski, W. J. (1996). Improvising organizational transformation over time: A situated change perspective. Information Systems Research, 7(1), 63–92. Orlikowski, W.  J., & Yates, J.  (2002). It’s about time: Temporal structuring in organizations. Organization Science, 13(6), 684–700. Osborn, R. N., & Hunt, J. G. (1974). Environment and organizational effectiveness. Administrative Science Quarterly, 19(2), 231–246. Othman, R., & Hasmin, N. A. (2004). Organization Amnesia: The Barrier to Organization Learning. Retrieved October 30, 2015, from http://apollon1.alba.edu.gr/OKLC2002/Proceedings/pdf_ files/ID308.pdf Ouchi, W. (1981). Theory Z: How American Business can meet the Japanese challenge. Reading, MA: Addison-Wesley. Péli, G., Bruggeman, J., Masuch, M., & Nualláin, B. O. (1994). A logical approach to formalizing organizational ecology. American Sociological Review, 59(4), 571–593. Pelham, A. M. (1997). Mediating influences on the relationship between market orientation and profitability in small industrial firms. The Journal of Marketing Theory and Practice, 5(2), 1–23. Peltoniemi, M., & Vuori, E. (2004). Business Ecosystem as the New Approach to Complex Adaptive Business Environments. Retrieved August 30, 2015, from http://citeseerx.ist.psu.edu/ viewdoc/download?doi=10.1.1.103.6584&rep=rep1&type=pdf Pennings, J. M. (1975). The relevance of the structural-contingency model of organizational effectiveness. Administrative Science Quarterly, 20, 393–410. Penrose, E. (1959). The theory of the growth of the firm. Oxford: Blackwell. Perrow, C. (1967). A framework for the comparative analysis of organizations. American Sociological Review, 26, 854–866. Penrose, E. T. (1968). The large international firm in developing countries: The international petroleum industry. London: Allen & Unwin. Perrow, C. (1986). Complex organizations: A critical essay (3rd ed.). New York: Random House. Perry, C. (1998). Processes of A Case Study Methodology for Postgraduate Research in Marketing. European Journal of Marketing, 32(9/10), 785–802. Peteraf, M.  A. (1993). The cornerstones of competitive advantage: A resource-based view. Strategic Management Journal, 14(3), 179–191. Peters, T., & Waterman, R. (1982). In search of excellence. New York: Harper & Row. Pettigrew, A. M. (1973). The politics of organizational decision making. London: Tavistock. Pettigrew, A.  M. (1977). Strategy formulation as a political process. International Studies of Management & Organization, 7(2), 78–87. Pettigrew, A.  M. (1985a). The awakening giant: Continuity and change in imperial chemical industries. Oxford: Basil Blackwell. Pettigrew, A.  M. (1985b). Contextualist research: A natural way to link theory and practice. In E. E. Lawler (Ed.), Doing research that is useful in theory and practice. San Francisco: Jossey Bass. Pettigrew, A.  M. (1987). Context and action in the transformation of the firm. Journal of Management Studies, 24, 649–670. Pettigrew, A. M. (1990). Longitudinal field research on change: Theory and practice. Organization Science, 1, 267–292. Pettigrew, A. M. (1997). What is a processual analysis? Scandinavian Journal of Management, 13, 337–348. Pettigrew, A. M. (2012). Context and action in the transformation of the firm: A reprise. Journal of Management Studies, 49(7), 1304–1328. Pettigrew, A. M., & Fenton, E. (2000). The innovating organisation. London: Sage.

158

References

Pettigrew, A., Massini, S., & Numagami, T. (2000). Innovative forms of organising in Europe and Japan. European Management Journal, 18(3), 259–273. Pfeffer, J. (1972). Size and composition of corporate boards of directors: The organization and its environment. Administrative Science Quarterly, 17, 218–228. Pfeffer, J. (1997). New directions for organization theory. New York: Oxford University Press. Pfeffer, J., & Salancik, G. R. (1978). The external control of organizations: A resource dependence perspective. New York: Harper and Row. Pinchot, G., III. (1985). Intrapreneuring. New York: Harper & Row. Prahalad, C. K., & Hamel, G. (1994). Strategy as a field of study: Why search for a new paradigm? Strategic Management Journal, 15, 5–16. Piercy, N. F., Cravens, D. W., & Morgan, N. A. (1997). Sources of effectiveness in the business-to-­ business sales organization. Journal of Marketing Practice, Applied Marketing Science, 3(1), 43–69. Piercy, N., & Rich, N. (2009). Lean transformation in the pure service environment: The case of the call service centre. International Journal of Operations & Production Management, 29(1), 54–76. Pollay, R.  W. (1970). The structure of executive decisions and decision times. Administrative Science Quarterly, 15(4), 459–471. Poole, M. S., & Van de Ven, A. H. (1989). Toward a general theory of innovation. In A. H. Van de Ven, H. Angle, & M. S. Poole (Eds.), Research on the management of innovation (pp. 637– 662). New York: HarperCollins. Porter, M. (1980). Competitive strategy. New York: Free Press. Porter, M. (1983). Cases in competitive strategy. New York: Free Press. Porter, M. (1985). Competitive advantage. New York: Free Press. Porter, M. E. (1986). The strategic role of international marketing. Journal of Consumer Marketing, 3, 17–21. Porter, M. E. (1996). What is strategy? Harvard Business Review, 74(6), 61–78. Powell, T. C. (1995). Total quality management as competitive advantage: A review and empirical study. Strategic Management Journal, 16(1), 15–37. Powers, T. L., & Loyka, J. J. (2007). Market, industry, and company influences on global product standardization. International Marketing Review, 24, 678–694. Powers, T. L., & Loyka, J. J. (2010). Adaptation of marketing mix elements in international markets. Journal of Global Marketing, 23(1), 65–79. Prahalad, C. K., & Hamel, G. (1990). The core competencies of the corporation. Harvard Business Review, 79–90. Prigogine, I., Nicholis, G., & Baloyantz, A. (1972). Thermodynamics of evolution: Part I. Physics Today, 25(11), 38–44. Primc, K., & Čater, T. (2015). The influence of organizational life cycle on environmental proactivity and competitive advantage: A dynamic capabilities view. Organization & Environment, 29(2), 1–19. doi:10.1177/1086026615584684. Pulakos, E.  D., Arad, S., Donovan, M.  A., & Pamondon, K.  E. (2000). Adaptability in the workplace: Development of a taxonomy of adaptive performance. The Journal of Applied Psychology, 85(4), 612–624. Quinn, R., & Cameron, K. (1983). Organizational life cycles and shifting criteria of effectiveness: Some preliminary evidence. Management Science, 29(1), 33–41. Ragin, C. C. (1987). The comparative method. California CA: University of California Press. Rai, A., Patnayakuni, R., & Seth, N. (2006). Firm performance impacts of digitally enabled supply chain integration capabilities. MIS Quarterly, 30(2), 225–246. Randolph, W. A., & Dess, G. G. (1984). The congruence perspective of organization design: A conceptual model and multivariate research approach. The Academy of Management Review, 9(1), 114–127. Rant, M. (2007). Differences in adaptations between service and manufacturing firms. Journal of Economics and Business, 25, 245–268. Robello, K. (1994). Newton: Will what fell down go up? Business Week, 11, 41.

References

159

Robbins, S. P., & Judge, T. A. (2009). Organisational behaviour (13th ed.). Upper Saddle River, NJ: Pearson Prentice Hall. Robinson, P. (1994). Applying institutional theory to the study of the multinational enterprise: Parental control and isomorphism among personnel practices in American Manufacturers in Japan. Doctoral dissertation, MIT, Boston. Rosenzweig, P.  M., & Singh, J.  V. (1991). Organizational environments and the multinational enterprise. The Academy of Management Review, 16(2), 340–361. Rowley, J. (2002). Using case studies in research. Management Research News, 25(12), 16–27. Rugman, A. M., & Verbeke, A. (1998). Corporate strategies and environmental regulations: An organizing framework. Strategic Management Journal, 19, 363–375. Rumelt, R. P. (1995). Inertia and transformation. In C. Montgomery (Ed.), Resource based and evolutionary theories of the enterprise (pp. 101–132). Boston, MA: Kluwer Academic. Sandell, R. (2001). Organizational growth and ecological constraints: The growth of social movements in Sweden, 1881 to 1940. American Sociological Review, 66(5), 672–693. Sarkar, C. (2013, May). The Kodak Moment: A Failure of Management Imagination? Retrieved November 9, 2015, from http://www.christiansarkar.com/2013/05/the-kodak-moment-afailure-­­of.htm Schein, E. H. (1983). Organizational culture. Organizational Dynamics, 12, 13–28. Schein, E. H. (2010). Organizational culture and leadership. Jossey-Bass, A Wiley Imprint. Schendel, D. E., & Hofer, C. W. (1979). Strategic management: A new view of business policy and planning. Boston: Little, Brown and Company. Scherer, F. M. (1980). Industrial market structure and economic performance (2nd ed.). Boston: Houghton-Mifflin. Schmidt, S., Tyler, K., & Brennan, R. (2007). Adaptation in inter-firm relationships: Classification, motivation, calculation. Journal of Services Marketing, 21(7), 530–537. Schneider, S., & Barsoux, J. L. (2003). Management interculturel. Paris: Pearson. Schollhammer, H. (1982). Internal corporate entrepreneurship. In C.  A. Kent, D.  L. Sexton, & K. H. Vesper (Eds.), Encyclopedia of entrepreneurship (pp. 209–223). Englewood Cliffs, NJ: Prentice Hall. Schoonhoven, C. B. (1981). Problems with contingency theory: Testing assumptions hidden within the language of contingency theory. Administrative Science Quarterly, 26, 349–377. Schumpeter, J. A. (1934). The theory of economic development: An inquiry into profits, capital, credit, interest and the business cycle. Cambridge, MA: Harvard University Press. (Reprinted in 1962). Schwartz, H., & Davis, S.  M. (1981). Matching corporate culture and business strategy. Organizational Dynamics, 10(1), 3. Schwartz, H., & Davis, S. (1981). Matching corporate culture and business strategy. Organizational Dynamics, 10(Summer), 30–48. Scott, W.  R. (1987). The adolescence of institutional theory. Administrative Science Quarterly, 32(4), 493–511. Scott, W. R. (1992). Organizations: Rational, natural and open systems. Englewood Cliffs, NJ: Prentice-Hall. Scott, R. (1998). Organizations—Rational, natural, and open systems. Upper Saddle River, NJ: Prentice Hall. Seah, M., Hsieh, M.  H., & Huang, H.  Y. (2014). Leader driven organizational adaptation. Management Decision, 52(8), 1410–1432. Selznick, P. (1957). Leadership in administration. New York: Harper & Row. Sevon, G. (1996). Organizational imitation in identity transformation. In B.  Czarniawska & G. Sevon (Eds.), Translating organizational change. New York: Walter de Gruyter. Sexton, D. L., & Vesper, K. H. (Eds.). (1982). Encyclopedia of entrepreneurship (pp. 209–223). Englewood Cliffs, NJ: Prentice Hall. Shapiro, B. P. (1988). What the hell is ‘Market Oriented’? Harvard Business Review, 66, 119–125. Sharma, S. (2000). Managerial interpretations and organisational context as predictors of corporate choice of environmental strategy. The Academy of Management Journal, 43, 681–697.

160

References

Sharma, R., Reynolds, P., Scheepers, R., Seddon, P., & Shanks, G. (2010). Business analytics and competitive advantage: A review and a research agenda. In A. Respicio, F. Adam, & G. Phillips-­ Wren (Eds.), Bridging the socio-technical gap in decision support systems—Challenges for the next decade (pp. 187–198). Amsterdam, NL: IOS Press. Shaw, R. B., & Perkins, D. N. T. (1991). Teaching organizations to learn. Organization Development Journal, 9, 1–12. Sheth, J., & Sisodia, R. (2002). The rule of three: Surviving and thriving in competitive markets. New York: The Free. Shin, M. (2004). A framework for evaluating economics of knowledge management systems. Information Management, 42(1), 176–196. Shrivastava, P. (1995). The role of corporations in achieving ecological sustainability. The Academy of Management Review, 20(4), 936–960. Simintiras, A. C., & Cadogan, J. W. (1996). Behaviourism in the study of salesperson-customer interactions. Journal of Management Decision, 34(6), 57–64. Simmonds, K. (1985). Global strategy: Achieving the geocentric ideal. International Marketing Review, 2, 8–17. Simon, H. A. (1947). Administrative behaviour. New York: Macmillan. Simon, H.  A. (1991). Organizations and markets. The Journal of Economic Perspectives, 5(2), 25–44. Simon, H. A. (1996). The sciences of the artificial (3rd ed.). Cambridge, MA: MIT Press. Singh, J.  V., & Lumsden, C.  J. (1990). Theory and research in organizational ecology. Annual Review of Sociology, 16, 161–195. Singh, J. V., Tucker, D. J., & House, R. J. (1986). Organizational legitimacy and the liability on newness. Administrative Science Quarterly, 31, 171–193. Sinkula, J.  M. (1994). Market information processing and organizational learning. Journal of Marketing, 58, 35–45. Sinkula, J.  M., Baker, W., & Noordewier, T.  G. (1997). A framework for market-based organizational learning: Linking values, knowledge and behaviour. Journal of the Academy of Marketing Science, 25, 305–318. Sirmon, D. G., Hitt, M. A., Arregle, J. L., & Campbell, J. T. (2010). The dynamic interplay of capability strengths and weaknesses: Investigating the bases of temporary competitive advantage. Strategic Management Journal, 31(13). Skalen, P., & Edvardsson, B. (2016). Transforming from the goods to the service-dominant logic. Marketing Theory, 16(1), 101–121. Slater, S. F., & Narver, J. C. (1994). Does competitive environment moderate the market orientation-­ performance relationship? Journal of Marketing, 58, 46–55. Slater, S. F., & Narver, J. C. (1995). Market orientation and the learning organization. Journal of Marketing, 59(3), 63–74. Slater, S. F., & Oslon, E. M. (2000). Strategy type and performance: The influence of sales force management. Strategic Management Journal, 21(8), 813–829. Slater, G., & Spencer, D. A. (2000). The uncertain foundations of transaction costs economics. Journal of Economic Issues, 34(1), 61–87. Slevin, D.  P., & Covin, J.  G. (1990, Winter). Juggling entrepreneurial style and organizational structure-how to get your act together. Sloan Management Review, 31(2), 43–53. Sminia, H., & De Rond, M. (2012). Context and action in the transformation of strategy scholarship. Journal of Management Studies, 49(7), 1329–1349. Smircich, L., & Stubbart, C. (1985). Strategic management in an enacted world. The Academy of Management Review, 10, 724–736. Smith, G.  S., Guthrie, J.  P., & Chen, M. (1989). Strategy, size, and performance. Organization Studies, 10, 63–81. Snow, C. C., & Hrebiniak, L. G. (1980). Strategy, distinctive competence, and organizational performance. Administrative Science Quarterly, 25, 317–336. Spender, J.  C. (1996). Making knowledge the basis of a dynamic theory of the firm. Strategic Management Journal, 17, 45–62. (Special Issue: Knowledge and the Firm).

References

161

Spender, J.  C. (1998). Pluralist epistemology and the knowledge-based theory of the firm. Organization, 5, 233–256. Starbuck, W. H. (1976). Organizations and their environments. In M. D. Dunnette (Ed.), Handbook of industrial and organizational psychology (pp. 1089–1123). Chicago: Rand McNally. Starkey, K. (1989). Time and work: A psychological perspective. In P. Blyton, J. Hassard, S. Hill, & K. Starkey (Eds.), Time, work and organization (pp. 35–56). London, UK: Routledge. Staw, B. M., & Szwajkowski, E. (1975). The scarcity-munificence component of Organizational Environments and the Commission of Illegal Acts. Administrative Science Quarterly, 20(3), 345–354. Stearns, T.  M., Hoffman, A.  N., & Heide, J.  B. (1987). performance of commercial television stations as an outcome of inter-organisational linkages and environmental conditions. The Academy of Management Journal, 30, 71–90. Steiner, G. A., & Miner, J. B. (1977). Management policy and strategy. New York: Macmillan. Stewart, T. A. (1991). Brainpower. Fortune, 123, 44–60. Steger, U., Amann, W., & Maznevski, M. (2007). Managing complexity in global organizations. Chichester: Wiley. Stevenson, H. H., & Jarillo, J. C. (1990). A paradigm of entrepreneurship: Entrepreneurial management. Strategic Management Journal, 11, 17–27. Stockdale, R., & Standing, C. (2006). An interpretive approach to evaluating information systems: A content, context, process framework. European Journal of Operational Research, 173, 1090–1102. Storbacka, K., Ryals, L., Davies, L. A., & Nenonen, S. (2009). The changing role of sales: Viewing sales as a strategic, cross-functional process. European Journal of Marketing, 43(7/8), 890–906. Styhre, A. (2002). Non-linear change in organizations: Organizational change management informed by complexity theory. Leadership and Organizational Development Change Journal, 23, 343–352. Sundaram, A.  K., & Inkpen, A.  C. (2004). Stakeholder theory and “The Corporate Objective Revisited”: A reply. Organization Science, 15(3), 370–371. Swaminathan, A. (1996). Environmental conditions at founding and organizational mortality: A trial-by-fire model. The Academy of Management Journal, 39(5), 1350–1377. Sztompka, P. (1991). Society in action: The theory of social becoming. Chicago: Univ. Chicago Press. Sztompka, P. (1993). The sociology of social change. London: Basil Blackwell. Szulanski, G. (1993). Intrafirm transfer of best practice, appropriate capabilities, organizational barriers to appropriation (Working Paper). INSEAD, Fontainebleau, France. Szulanski, G., Capetta, R., & Jensen, R.  J. (2004). When and how trustworthiness matters: Knowledge transfer and the moderating effect of causal ambiguity. Organization Science, 15, 600–613. Szulanski, G., & Jensen, R. J. (2006). Presumptive adaptation and the effectiveness of knowledge transfer. Strategic Management Journal, 27, 937–957. Takii, K. (2007). The value of adaptability—Through the analysis of a firm’s prediction ability. Journal of Economics and Business, 59, 144–162. Teece, D. J. (2007). Explicating dynamic capabilities: The nature and micro-foundations of (sustainable) enterprise performance. Strategic Management Journal, 28, 1319–1350. Teece, D.  J., Pisano, G., & Shuen, A. (1997). Dynamic capabilities and strategic management. Strategic Management Journal, 18(7), 509–534. The Economist. (2012). The Last Kodak Moment? Kodak is at Death’s Door; Fujifilm, its Old Rival, is Thriving. Why? January 14th 2012; New York and Tokyo. Retrieved October 7, 2015, from http://www.economist.com/node/21542796 The Independent. (2012). The Moment It All Went Wrong For Kodak. The Independent, Friday 20 January, 2012. Retrieved October 7, 2015, from http://www.independent.co.uk/news/business/ analysis-and-features/the-moment-it-all-went-wrong-for-kodak-6292212.html The World Street Journal. (2012, February 26). The Demise of Kodak: Five Reasons. Retrieved October 7, 2015, from http://blogs.wsj.com/source/2012/02/26/the-demise-of-kodak-five-reasons/

162

References

Theodosiou, M., & Leonidou, L.  C. (2003). Standardization versus adaptation of international marketing strategy: An integrative assessment of the empirical research. International Business Review, 12(2), 141–171. Thompson, J. D. (1967). Organizations in action. New York: McGraw-Hill. Tolbert, P. S., & Zucker, L. G. (1996). The institutionalization of institutional theory [Electronic version]. In S. Clegg, C. Hardy, & W. Nord (Eds.), Handbook of organization studies (pp. 175– 190). London: SAGE. Tripsas, M., & Gavetti, G. (2000). Capabilities, cognition, and inertia: Evidence from digital imaging. Strategic Management Journal, 21(10/11), 1147–1161. (Special Issue: The Evolution of Firm Capabilities (Oct.–Nov., 2000)). Tsoukas, H. (1994). What is management? An outline of a metatheory. British Journal of Management, 5(4), 289–301. Tsoukas, H. (1996). The firm as a distributed knowledge system: A constructionist approach. Strategic Management Journal, 17, 11–25. Tushman, M. L., & Anderson, P. (1986). Technological discontinuities and organizational environments. Administrative Science Quarterly, 31, 439–465. Tushman, M. L., & O'Reilly, C. A. (1996). Ambidextrous organisations: Managing evolutionary and revolutionary change. California Management Review, 38(4), 8–30. Tushman, M.  L., & Rosenkopf, L. (1992). Organizational determinants of technological change: Toward a sociology of technological evolution. Research in Organizational Behavior, 14, 311–347. Urban, G. L., & Hauser, J. R. (1992). Design and marketing of new products II. Englewood Cliffs, NJ: Prentice-Hall. Ulrich, D. (1987). Organizational capability as competitive advantage: Human resource professionals as strategic partners. Human Resource Planning, 10, 169–184. Utterback, J., & Abernathy, W. (1975). A dynamic model of process and product innovation. Omega, 3(6), 639–656. Van Cauwenbergh, A., & Cool, K. (1982). Strategic management in a new framework. Strategic Management Journal, 3(3), 245–264. Van de Ven, A. H. (1992). Suggestions for studying strategy process: A research note. Strategic Management Journal, 13, 169–188. Van de Ven, A.  H., & Drazin, R. (1985). The concept of fit in contingency theory. In L.  L. Cummings & B. W. Staw (Eds.), Research in organizational behaviour (Vol. 7, pp. 333–365). Greenwich, CT: JAI Press. Van de Ven, A. H., & Poole, M. S. (1988). Paradoxical requirements for a theory of organizational change. In R. Quinn & K. Cameron (Eds.), Paradox and transformation: Toward a theory of change in organization and management (pp. 19–80). New York: HarperCollins. Van de Ven, A. H., & Poole, M. S. (1995). Explaining development and change in organizations. The Academy of Management Review, 20, 510–540. Vasconcelos, F.  C., & Ramirez, R. (2011). Complexity in business environments. Journal of Business Research, 64, 236–241. Venkatraman, N. (1989a). Strategic orientation of business enterprises: The construct, dimensionality, and measurement. Management Science, 35(8), 942–962. Venkatraman, N. (1989b). The concept of fit in strategy research: Toward verbal and statistical correspondence. The Academy of Management Review, 14, 423–444. Venkatraman, N., & Camillus, J. C. (1984). Exploring the concept of “Fit” in strategic management. The Academy of Management Review, 9(3), 513–525. Venkatraman, N., & Prescott, J. E. (1990). Environment-structure coalignment: An empirical test of its performance implications. Strategic Management Journal, 11, 1–23. Verona, G., & Ravasi, D. (2003). Unbundling dynamic capabilities: An exploratory study of continuous product innovation. Industrial and Corporate Change, 12(3), 577–606. Viio, P. (2011). Strategic sales process adaptation: Relationship orientation of the sales process in the business-business context. Doctoral thesis, Hanken School of Economics, Helsinki. Viio, P., & Grönroos, C. (2014). Value-based sales process adaptation in business relationships. Industrial Marketing Management, 43, 1085–1095.

References

163

Virany, B., Tushman, M. L., & Romanelli, E. (1992). Executive succession and organization outcomes in turbulent environments: An organization learning approach. Organization Science, 3(1), 72–91. Viswanathan, N. K., & Dickson, P. R. (2007). The fundamentals of standardizing global marketing strategy. International Marketing Review, 24, 43–63. Vladimirova, Y. (2013). Internationalization and the dynamics of product adaptation: The case of parfois. Master dissertation, Master in International Economics and Management, University of Porto (Portugal). Adaptation of Marketing Mix Elements in International Markets. Volberda, H., & Baden-Fuller, C. (1998). Strategic renewal and competence building: Four dynamic mechanisms. In G. Hamel, C. K. Prahalad, H. Thomas, & D. O’Neal (Eds.), Strategic flexibility: Managing in a turbulent environment (pp.  371–390). Chichester and New  York: Wiley. Volberda, H., & Lewin, A. (2003). Co-evolutionary dynamics within and between firms: From evolution to co-evolution. Journal of Management Studies, 40, 2111–2136. Vrontis, D., & Vronti, P. (2004). Levi strauss: An international marketing investigation. Journal of Fashion Marketing and Management, 8(4), 389–398. Walsh, J.  P., & Ungson, G.  R. (1991). Organizational memory. The Academy of Management Review, 16(1), 57–91. Wang, C.  L. (2008). Entrepreneurial orientation, learning orientation, and firm performance. Entrepreneurship Theory and Practice, 32(4), 635–656. Webber, S. S., & Donahue, L. M. (2001). Impact of highly and less job-related diversity on work group cohesion and performance: A meta-analysis. Journal of Management, 27(2), 141–162. Webster, F. E., Jr. (1988). Rediscovering the marketing concept. Business Horizons, 31, 29–39. Weerawardena, J. (2003). Exploring the role of market learning capability in competitive strategy. European Journal of Marketing, 37(3/4). Weerawardena, J., & Mavondo, F. T. (2011). Capabilities, innovation and competitive advantage. Industrial Marketing Management, 40, 1220–1223. Weick, K. E. (1969). The social psychology of organizing. Reading, MA: Addison-Wesiey. Weick, K. E. (1979). The social psychology of organizing (2nd ed.). Reading, MA: Addison-Wesiey. Weick, K. E., & Daft, R. L. (1983). The effectiveness of interpretation systems. In K. S. Cameron & D. A. Whetten (Eds.), Organizational effectiveness: A comparison of multiple models (pp. 71–93). New York: Academic Press. Weick, K. E. (1988). Enacted sense making in crisis situations. Journal of Management Studies, 25, 305–317. Weick, K. E., & Van Orden, P. W. (1990). Organizing on a global scale: A research and teaching agenda. Human Resource Management, 29(1), 49–61. Weick, K. E., & Quinn, R. E. (1999). Organizational change and development. In J. T. Spence, J. M. Darley, & D. J. Foss (Eds.), Annual review of psychology (Vol. 50, pp. 361–386). Palo Alto, CA: Annual Reviews. Westney, D. E. (1987). Imitation and innovation: The transfer of western organizational patterns to Meiji Japan (1st ed.). Cambridge, Ma: Harvard University Press. Whittington, R. (1988). Environmental structure and theories of strategic choice. Journal of Management Studies, 25, 521–536. Whittington, R., Pettigrew, A., Peck, S., Fenton, E., & Conyon, M. (1999). Change and complementarities in the new competitive landscape: A European Panel Study, 1992–1996. Organization Science, 10(5), 583–600. Wiersema, M. F., & Bantel, K. A. (1992). Top management team demography and corporate strategic change. The Academy of Management Journal, 35(1), 91–121. Williamson, O. (1979). Transaction cost economics: The governance of contractual relations. Journal of Law and Economics, 22, 233–261. Williamson, O. E. (1985). The economic institutions of capitalism: Firms, markets, relational contracting. New York: Free Press. Williamson, O. (1991a). Comparative economic organization: The analysis of discrete structural alternatives. Administrative Science Quarterly, 36, 269–296.

164

References

Williamson, O. (1991b). Strategizing, economizing, and economic organization. Strategic Management Journal, 12, 75–94. Williamson, O. (1998). Transaction cost economics: How it works; Where it is headed. De Economist, 146(1), 23–58. Willmott, H. (1997). Rethinking management and managerial work: Capitalism, control and subjectivity. Human Relations; Studies Towards the Integration of the Social Sciences, 50(11), 1329–1360. Winston, G. C. (1988). Three problems with treatment of time in economics: Perspectives, repetitiveness and time units. In G. C. Winston & R. F. Teichgraeber III (Eds.), The boundaries of economics. Cambridge: Cambridge University Press. Winter, S. (1987). Knowledge and competence as strategic assets. In D. Teece (Ed.), The competitive challenge (pp. 159–184). Boston: Harvard Business School Press. Winter, S.  G. (2000). The satisficing principle in capability learning. Strategic Management Journal, 21(10–11), 981–996. Winter, S. G. (2003). Understanding dynamic capabilities. Strategic Management Journal, 24(10), 991–995. Womack, J. P., Jones, D. T., & Roos, D. (1990). The machine that changed the world. New York: Rawson Associates. Woo, C.  Y., & Cooper, A.  C. (1981). Strategies of effective low share business. Strategic Management Journal, 2, 301–318. Yalcin, S., Singh, N., Dwivedi, Y. K., Apil, A. R., & Sayfullin, S. (2011). Culture and localization on the web: Evidence from multinationals in Russia and Turkey. Journal of Electronic Commerce Research, 12(1), 94–114. Yasai-Ardekani, M. (1986). Structural adaptations to environments. The Academy of Management Review, 11, 9–21. Yasai-Ardekani, M. (1989). Effects of environmental scarcity and munificence on the relationship of context to organizational structure. The Academy of Management Journal, 32(1), 131–156. Yavas, U., Verhage, B., & Green, R. T. (1992). Global consumer segmentation versus local market orientation: Empirical findings. Management International Review, 32, 265–272. Zajac, E. J., Kraatz, M. S., & Bresser, R. K. F. (2000). Modelling the dynamics of strategic fit: A normative approach to strategic change. Strategic Management Journal, 21, 429–453. Zahra, S. A., & Pearce, J. A., II. (1990). Research evidence on the miles-snow typology. Journal of Management, 16, 751–768. Zammuto, R. F., & Cameron, K. S. (1985). Environmental decline and organizational response. In B. M. Staw & L. L. Cummings (Eds.), Research in organizational behaviour (Vol. 7, pp. 223– 262). Greenwich, CT: JAI Press. Zeleny, M. (1986). The law of requisite variety: Is it applicable to human systems? Human Systems Management, 6(4), 269–271. Zollo, M., & Winter, S. G. (2002). Deliberate learning and the evolution of dynamic capabilities. Organization Science, 13, 339–351. Zoltners, A. A., Sinha, P., & Lorimer, S. E. (2008). Sales force effectiveness: A framework for researchers and practitioners. Journal of Personal Selling & Sales Management, 281(2), 115–131.

Index

A Adaptability, 16, 26, 37, 38, 45, 50, 53, 55, 83, 122, 128, 129 Adaptation, 1–9, 11, 21–23, 26–29, 34–36, 39–43, 45–50, 53, 61, 62, 64, 68, 75, 76, 78, 80–83, 85, 86, 89–93, 95–101, 103–107, 112, 123, 124, 127–138 Adaptive behaviour paradigms, 9, 49, 50, 76, 100, 107, 108, 117, 120, 124, 129, 135 Adaptive capabilities, 40, 44, 45, 47, 74, 80, 85, 88, 91, 92, 96, 136 Adaptive complex system, 2, 117 Alignment, 37, 38, 45, 50, 53, 76, 85, 128, 129 Ambidexterity, 38, 128 Analysis, 3, 5, 8, 9, 19, 20, 24, 26, 32, 48, 49, 53, 72, 83, 95, 100–107, 114, 117, 123, 129, 130, 135, 136 Analytical framework, 117, 137 B Behaviour, 5, 6, 9, 15, 18, 19, 23, 27, 29, 35, 41, 49, 50, 52, 55, 58–62, 64, 71, 76, 77, 95, 100, 104, 107, 108, 113, 117, 118, 120, 123, 124, 128, 129, 132, 133, 135 Business environment, 1–3, 12, 14, 20, 26, 41, 52, 75, 101, 129

Business model, 110, 114–116, 128 Business operations, 50, 129, 133, 137 Business practices, 133 C Capabilities, 82–90, 92–94, 100 Case study, 8, 9, 95, 100, 102, 104–107, 123, 124, 127, 128, 135–137 Cognition, 87, 123 Competition, 17, 18, 35, 58, 64, 86, 108, 112, 129 Competitive advantage, 20, 26, 28, 29, 38, 45, 51, 52, 59, 63, 64, 67, 80, 83, 84, 86, 89, 117, 120, 123, 134 Complexity theory, 41 Concept, 1, 3, 4, 7, 9, 16, 24, 27, 30, 31, 33, 34, 38, 39, 41–43, 47, 49, 51, 55, 60, 67, 68, 76, 77, 81, 85, 95, 105, 127, 130, 132, 134, 136, 137 Content, 8, 9, 13, 95, 100, 101, 103, 104, 106, 107, 112, 123, 136 Context/contextual, 5, 6, 8, 9, 11, 12, 18, 20, 21, 24–26, 29–32, 35, 38–40, 45–48, 50, 57–62, 65, 73, 74, 76, 79, 88, 95–98, 100–103, 105–107, 117, 123, 124, 135–137 Contingency theory, 2, 21, 29–31, 43, 62, 75, 77, 120, 128, 137

© The Author(s) 2018 O.E. Adegbite et al., Organisational Adaptations, SpringerBriefs in Business, DOI 10.1007/978-3-319-63510-1

165

Index

166 D Decision-making, 11, 55, 56, 99, 103 Digital camera, 113–116, 122 Digital photography, 112–115, 135 Digital technology, 115, 116 Diversity, 15, 42, 43, 74, 96, 138 Drivers, 15, 25, 82 Dynamic capabilities, 9, 16, 61, 67, 79, 81–85, 87, 89, 92, 94–96, 120, 130, 135, 136 E Eastman, 108, 109 Entrepreneurial challenge, 89 Environment, 1–6, 8, 9, 11–26, 29, 30, 32, 33, 35–38, 41, 44–47, 50, 52, 59, 61–70, 72–75, 79, 80, 82, 83, 85, 87, 90, 91, 93, 95, 96, 99, 101, 102, 107, 116, 118–120, 127–133, 138 Environmental influences, 21, 70 Environmental munificence, 17–20 Environmental unpredictabilities, 128 Evolutionary change, 132 Evolving, 1, 30, 44–47, 53, 83, 90, 120, 124, 129, 131 Explicit knowledge, 135 F Firm behavioural activities, 78 Fit, 21, 23, 29–31, 43, 47, 65, 75, 90, 98, 99, 107, 111, 120, 123, 132 Flexibility, 29, 53, 68, 77, 85, 86, 118, 132 Forms, 9, 18, 23, 33, 34, 58, 59, 64, 75, 77, 84, 92, 95–97, 100, 120, 130, 133, 136 Fujifilm, 9, 95, 107, 108, 110–112, 116, 117, 121–124, 127–129, 135, 136 G Gestalt, 137 Global market environments, 137 Globalisation, 15, 73, 96, 110 H Heterarchy, 84, 92 Higher-order capabilities, 85 Human actions, 136 Hyper-competitive, 41, 83

I Implicit knowledge, 135 Industry, 2–5, 9, 12, 18, 21, 24, 32, 39, 43, 45, 47, 55, 59, 69, 87, 91, 95, 107–113, 116, 117, 129, 135, 137 Inertia, 35, 88, 130–133, 137 Institutional theory, 36, 37 J Judgement, 8, 106, 123 K Knowledge, 2, 6, 8, 16, 27, 29, 31, 36, 39, 48, 51, 63, 64, 66, 67, 73, 77, 80, 82–84, 86–88, 92, 99, 103, 104, 106, 119, 123, 128, 129, 133–137 Kodak, 9, 95, 107–117, 121–123, 127, 129, 130, 132, 136 L Law of requisite variety, 42, 43 Leadership, 3, 50, 53, 87, 100, 109, 116, 117, 121, 122, 124, 129, 132 Lean manufacturing, 111 Learning, 6, 16, 23, 26, 50, 62–66, 76, 80, 82, 85, 88, 94, 96, 102, 119, 122, 129, 130, 132–135 Learning orientation, 63, 134 Long-term, 4, 18, 52, 55, 64, 79 M Management, 1–6, 8, 11, 12, 14, 16, 20, 21, 29, 31, 34–36, 38, 41–43, 45–47, 50–52, 55, 56, 58, 60–62, 64, 65, 67, 68, 71–77, 79, 80, 82, 84, 87, 90, 92, 95, 96, 98, 101, 103, 105, 111, 113, 114, 116, 118, 119, 122–124, 128–132, 134–136 Managerial, 13, 20, 23, 30, 32, 33, 39, 45, 50, 52, 65, 66, 70, 74, 86, 96, 103, 118, 123, 124, 133, 135 Market orientation, 50–55, 63, 64, 79, 114, 115, 118, 121, 128, 129, 135 Market players, 113–115, 129 Mechanism, 23, 101, 117 Mode, 90, 93 Multi-paradigm, 76, 135

Index N Network organisation, 84, 92 Normative action, 136, 137 O Organisational amnesia, 134, 137 Organisational complexity, 14, 41 Organisational culture, 2, 30, 38, 50, 51 Organisational life cycle, 62 Organisational restructuring, 90, 91, 123 Organisational structure, 14, 32, 36, 39, 55, 75 Orientation, 51–75, 79, 80, 97, 118–123 P Paradigm, 27, 28, 50, 51, 76, 117, 127, 134 Perspective, 3–5, 7, 16, 20–25, 28, 30, 33, 34, 40, 46, 51, 52, 56, 58, 60, 61, 99, 101, 104, 127, 131, 133, 135, 137, 138 Photographic, 9, 95, 107–117, 121, 122, 128–130, 133, 137 Pluralistic, 1, 4–8, 24, 27, 103, 104, 106, 123, 127, 134–138 Pluralistic perspective, 1, 4, 6, 8, 127, 134, 135, 137, 138 Population-ecology perspective, 23, 131 Presumptive adaptation, 130, 133 Proactive firm, 58 Processes, 5–8, 21, 27, 28, 35, 37, 40, 44, 49–51, 53, 55–58, 61, 65–68, 79, 80, 82, 84–86, 89, 90, 94–96, 100–103, 106, 111, 114, 120, 123, 128, 129, 131, 135, 136 Processual, 5, 8, 84, 92, 95, 100–107, 117, 123, 133, 136 Q Quality control, 109, 112 R Reconfigure, 37, 82, 88, 117, 130, 135 Recursiveness, 64, 85, 87, 88, 94, 130, 133, 137 Recursive practice, 64, 133 Resource, 17–22, 26, 28, 29, 35, 43, 57, 58, 62, 64, 66, 67, 80–85, 87, 92, 94, 96, 98, 128, 129, 133, 135, 136 Resource-based view, 67 Resource dependence theory, 43, 128 Responsiveness, 15, 43, 51, 53, 54, 59, 60, 101, 107, 118, 123

167 Risky ventures, 56, 79 Routines, 35, 82, 83, 85, 88, 92, 130 S Self-organising, 41 Social, 5–7, 18, 21, 23, 30–33, 36, 38, 39, 42, 44, 45, 47, 54, 58, 60–62, 65, 70, 71, 77, 87, 88, 96, 99, 103, 105, 113, 118, 134–136 Stakeholder approach, 74 Stakeholder orientation, 50, 75 Strategic choice theory, 32, 43 Strategic intent, 50, 76, 80 Strategic orientation, 97 Sunk costs, 131 Survival, 1, 6, 17, 18, 22, 23, 34, 35, 40, 42, 45, 46, 65, 76, 79, 80, 84, 87, 91, 98, 108, 111, 112, 121, 122, 127–129, 131 Systems, 1, 2, 7, 8, 11, 16, 30, 36, 39, 41, 42, 51, 53, 55, 63, 65, 67, 71, 72, 80, 84, 88, 92, 95, 110, 118, 122 T Tacit knowledge, 135 Task environment, 13, 18, 19 Temporal, 61, 62, 86, 102 Theory, 5–7, 12, 21, 29, 32, 34–39, 41–43, 46, 47, 62, 74, 104, 105, 127, 138 Time, 60–62, 79, 86, 97, 119, 121, 128 Transformation, 8, 28, 44, 85, 94, 100, 101, 106, 108, 112, 116, 117, 121 Triggers, 4, 11, 26, 50, 96, 97, 99, 120 U Uncertainties, 6, 12, 15, 25, 34, 55, 90, 98, 128 Understanding, 1, 2, 4, 6–9, 12, 20, 25, 27, 29, 31, 38, 43, 46, 50, 54, 55, 79, 90, 96, 99, 105, 123, 127, 134–138 Unlearning, 63, 80, 132 V Value, 6, 13, 15, 25, 36, 42, 49–56, 59, 62, 66–69, 73, 74, 79, 80, 82, 84, 86, 89, 96, 97, 100, 118, 121–123, 129, 134 Vulnerable, 90, 91 W Weaknesses, 59, 74, 119