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Summary The Adaptive Organization - ALL Studyquestions!
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Acces to this document: Merel, Jodie, Mathilde, Juliette, Anais, Elin & Sophie.● Woensdag/ donderdag antwoorden bespreken.
AO Study questions
Week 1 Sum:
Adaptation is crucial for a firm’s survival. Morgan (2006) theory of contingency is not about organizations being
flexible, but some are better than others and the environment decides this (Morgan, 2006). Albacota (2014),
organizations can adjust and even co-evolve. E.g The environment is made up of organizations. The organization
influences the environment and other organizations are going to copy, hence the environment influencing organizations
so adaptation is driven by external & internal selection (Morgan, 2006)’ determinism (Externally pulled) vs
voluntarism (internally pushed) (Abatecola,2014). Routines are an important internal selection mechanism, and enable
adaptation as they are a key resource of capability, although routines will foster inertia in the end. breaking away
requires intentional action, and requires meta-routines. Such in the role of routines in VSR (Feldman & Pentlan, 2003).
Strategizing needs to be both induced (variation reducing, ostensive routines) and autonomous (variation stimulation,
performance routines), the role of strategy in VSR. Combine strategic & structural context for balance (Burgelman,
1991).
All 4 articles together make the internal and external VSR.
Question 1: What influence does (successful) adaptation have on firm performance?
Merel
When an organization adapts successful, as a result, they will not get selected out (fail to adapt, resulting in bad
performance) So, environmental fit is important for firm success and survival!
Increasing organizations performance
Mattie
A successful adaptation influences firms performance in a positive way as it means that the organization is able to
sense, comprehends and use changes from the external selection environment with its external selection. Organizations
need to be able with adaptations or innovations to meet the demands of the external environment, otherwise they will be
selected out and fail. Adaptation will lead to achieve competitive advantage.
Juliette: Adaptation of firms is important for their survival and success, firms need to adapt to meet the requirement of
the external environment which can change over time. This is driven by external and internal selection environment.
● Prevent from not being selected out
Anais:
● With successful adaptation, firms avoid the decline phase of the life cycle -> they don’t stay stuck in the
phase where sales are decreasing
● Adaptation allows firms to stay on top of rival (link to Week 6 Nadkari, 2016)
Question 2: Not every adaptation is successful. What explains the failure of adaptation?
Merel
Not every adaptation is successful...allowing for strategic choice means some firms will change as their environment
changes but their adaptation is not a good fit with the environment and they are selected out
● This can because not every organization can or will adapt due unwillingness, inability, inertia of path
dependencies.
● Also, an adaptation can’t be good enough to survive.
Mattie
Not every adaptation is successful as organizations fail to match the adaptation between the situations. You can
,adapt but it needs to match the situation, if it is not a match then it is bad for performance. This can be linked to
path dependency, for example due to history the organization is too deep in its habits and processes, that are
working towards the future but by looking at the past. Moreover, it is possible that the routines and capabilities
make companies fail to adapt to changing conditions.
Juliette:
Firms adapt by reading their external environment and aligning this with their internal environment and their capabilities
and competencies. This needs to be supportive of the adaptation in order for it to be successful. When firms focus too
much on their internal competencies and capabilities, in this case the external environment can be neglected which can
lead to failure. Also, when firms focus too much on the external environment without having the competencies and
capabilities, (Polaroid example) this can also lead to failure.
● Fail to adapt inertia, path dependence, unwilling, unable
Anais:
Adaptation is all about balance. Through their strategy (Burgelman 1991) firms must balance the internal and external
selection environment = co-evolution theory (Abatecola 2014)
- External: contingency theory by Morgan 2006
- Internal: Induce/autonomous -> Do you need variation? (Burgelman 1991)
- Internal: consider your capabilities, if they don’t match not point. The link between internal selection
environment and competencies & capabilities is routines (Feldman 2003)
Question 3: Please explain why Burgelman argues that firms need to balance autonomous and induced
strategizing.
Merel/Jodie
Organizations and their environments are interdependent. Adjustments effected through the induced strategic process
serve the organization in its attempts to remain adaptive over some range of environmental variation and over a certain
time horizon. The autonomous strategic process, on the other hand, helps organizations develop, appropriate and retain
new learning.
Otherwise you will miss something. As your environment becomes more dynamic and your market becomes more
competitive, increasing variation increases adaptability. You have to increase variation as much as possible in the hope
that one variation fits with the environment.
But you need to balance between induced and autonomous. They are arguing that with this focus on the environment
you are not necessarily producing anything for the long term or really building on your competencies and capabilities. So
combine strategic context (what is going on in your environment) with your structural context (what is going on within
your organization).
Mattie
The process of strategizing comes from strategic intent, so both induced and autonomous are integrated in this.
● Induced strategizing is looking from within, your capabilities from your internal selection environment.
Root that ability to adatp in what you can do (think of variation reducing.)
● Autonomous strategizing is all about reading external and internal selection environment. The process
in which the internal selection environment selects, comprehends and uses the external selection
environment. (variation increasing)
The firms need to balance both as firms performance and survival is driven by both the internal and external selection
environment. You need to combine both strategic and structural contexts.
Juliette:
Firms need to balance induced and autonomous strategies for survival. Focus on change, but don’t deviate too much
from past success: they need to combine strategic context with structural context.
, Anais: According to Burgelman 1991, what matters is the process of strategizing. And the biggest challenge is to
balance the strategic context with the structural context.
The strategic context is what CEO and TMT want = a certain direction, a preference for exploitation or exploration ->
however this is too strict, variation is reduced and it lacks of local responsiveness.
The structural context is how the firm acts, employees for the lowest level can be the source of CE (great source of
learning = competences development, Zahra 1999) if there is a form of ambidexterity within the firm (Birkinshaw 2004).
giving freedom (autonomous strategizing) is great to increase variation + extend boundaries on capabilities + bring local
level. However the top management does not always listen / allocate the resources.
Firms need both to survive uncertainty.
Question 4: Please identify the conditions under which a routine will experience incremental change, radical
change, or rupture (the routine breaks).
Merel
Conditions under which a routine will experience:
Incremental change → gradually, small changes over time (induced strategizing); increased market
competition
Radical → Black swans (covid)
Rupture → When a company fails, new regulation/change in external environment
Mattie:
An incremental change will happen gradually, small changes over time. Incremental will happen when induced
strategizing will happen. Radical changes will happen during black swans for example, such as covid. Everybody had to
adapt their routines. Rupture would likely happen when a company fails, or when a completely new regulation/change in
external environment would make the whole routine obsolete.
Juliette:
Incremental change when there are small changes in the environment leading to small changes in
routines → Gradual change Routines dynamics (small adjustments in routines = change)Radical change
leads to stability-performance gap (too much stress build up= new routine)
Sophie:
Existing literature on routines focus on stability (feature of routines) and ignores the impact of agency.. If agency is not
allowed, then the routine will experience a radical change, because it is assumed that (when not allowing for agency):
routines are stable, deterministic, punctuated equilibrium.
Feldman & Pentland allow for agency. Allowing for agency gives a more realistic view at the way firms adapt to
changing environments. When allowing for agency there is an incremental change to routines as routines are
changeable, voluntaristic, gradual change.
A routine ruptures (‘breaks’) due to an environmental change that results in a misalignment between the environment
and the routine. The routine must be renewed: the novel routine will align with the environment again.
Jodie
When there is a stability-performance gap there will be radical change or rupture. When your environment changes
radically it creates stress. The environment no longer fits with the routine. Routine is no longer in line with the
environment. When this creates too much stress, the routine completely changes (radical change of the routine) or you
have to adopt a novel routine (rupture routines) and then everything continues on as normal.
Feldman and Pentland’s routine dynamics
As the environment changes there can be small adjustments in routines which facilitate adaptation this gradual change
ensures that routine is in line with the environment (incremental change).
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