| A Study of Revolutionary and Non-Revolutionary Organizational Transformation in the Banking Industry |
| | Wischnevsky, J. Daniel | Rutgers U. | danwisch@rci.rutgers.edu | (973) 353-1065 |
| | Damanpour, Fariborz | Rutgers U., Newark | fdamanpo@andromeda.rutgers.edu | 973-353-5050 |
| | This study investigates the occurrence of revolutionary and non-revolutionary transformations in a sample of 50 large U.S. bank holding companies over 20 years. Revolutionary transformation involves brief, discontinuous, and simultaneous change in strategy, structure and power distribution over a brief period of time. Non-revolutionary transformation consists of major shifts in those three domains of organizational activity accomplished gradually over an extended period of time. The study examines whether one of the main tenets of the punctuated equilibrium model of organizational evolution - that organizational transformation primarily occurs through revolutionary change - is dependent upon the characteristics of the organizational environment. Explicit empirical testing of the core notions of the punctuated equilibrium model is essentially limited to a study by Romanelli & Tushman (1994), who studied organizations operating in a turbulent context. Heeding to their call for a replication of that research in a different industry context, this research is conducted in the commercial banking industry, a traditionally less turbulent setting which over the past 20 years has nevertheless exhibited considerable environmental variation. Organizational, industry, and macro-environmental data were collected from company reports, financial databases, industry publications, and government sources between 1975-1995. We found that: (1) although revolutionary transformation is a common mechanism for organizational change in this sample, non-revolutionary transformation is a viable and competing mechanism; and (2) the likelihood that the predominant mechanism for organizational transformation be revolutionary increases as the environment becomes more complex. |
| | Keywords: Organizational Transformation; Organizational Environment; Banking Industry |
| Radical Organizational Change During Institutional Upheaval |
| | Newman, Karen L. | McDonough School of Business, Georgetown U. | newmank@gunet.georgetown.edu | (202)-687-3769 |
| | Radical organizational change in the transition economies of central and eastern Europe is
qualitatively different from that observed in the West because of concomitant upheaval in the institutional
context. By institutional upheaval, I mean rapid and pervasive change in the institutions of society, such as
the legal system, the banking system, financial markets, and political systems as well as change in the
values and assumptions that support these institutions. Drawing on theories of radical organizational
change, organizational learning theory, and institutional theory, I suggest that institutional upheaval inhibits
radical organizational change by inhibiting organizational learning. Institutional upheaval inhibits
organizational learning by destroying existing organizing templates, creating ambiguous cause-effect
relationships between organizational actions and outcomes, and rendering the knowledge of specialist
intermediaries such as consultants less appropriate. The result is less organizational ability to learn,
manifested in over-reliance on old, inappropriate routines, strategic confusion, and mimetic change based
on irrelevant models. All of these outcomes inhibit radical organizational change. The effects of
institutional upheaval are especially strong for those firms that were most embedded in the institutions of
central planning and that were founded during the central planning era. By integrating three theoretical
perspectives the concpetual framework in this paper more fully explains radical organizational change in a
variety of institutional contexts while also elaborating a process by which radical organizatnional change
takes place. |
| | Keywords: radical change; organizational learning; transition economies |
| A Meta Approach to Mega Scale Issues in a Large Urban School District |
| | Fisher, Susan R. | Oklahoma State U. | fishers@actioninternet.net | (407)-896-7577 |
| | Burlingame, Martin | Oklahoma State U. | mburled@okway.okstate.edu | (405)-744-6276 |
| | This is a case study of restructuring in the 16th largest public school district in the United States, the Orange County Public Schools (OCPS) in central Florida. Many urban school districts in the United States face a structural dilemma. While consolidation and growth have resulted in massive sized organizations, today’s most prevalent school reforms are focused on promoting greater autonomy at the school level. Like many of our largest corporations, OCPS is currently undergoing a radical structural change intended to balance the economy-of-scale benefits that accompany large size with the need for flexibility and responsiveness in the delivery of educational services. We examine the initial stages of restructuring in OCPS by using archival data and interviews. We also compare the OCPS process to similar efforts in other large, urban districts to identify attributes that distinguish it from previous experience. Although many large, urban districts have attempted to implement school-based management, their overall success rate has been less than exemplary. Our analysis indicates that OCPS may have found a solution to this problem with a regional structure and an extraordinary governance coalition between the elected school board and the new district superintendent. |
| | Keywords: school district governance; restructuring; school-based management |
| In Search of Innovation: Determinants of New Product Innovation and Radicality |
| | Katila, Riitta | U. of Texas, Austin | rkatila@mail.utexas.edu | (512)-471-3676 |
| | Ahuja, Gautam | U. of Texas, Austin | ahuja@bus.utexas.edu | (512)-471-7526 |
| | The concept of search, problem-solving efforts to create knowledge, is increasingly used in the innovation literature. However, confusions exist over its scope, outcomes, and underlying causal mechanisms. In this paper the impact of innovation search on new product output is examined. We ask two questions: (1) How does the firm's approach to innovation search affect the number of its new product introductions?, and, (2) What characteristics of search determine their radicality? These questions are theoretically addressed based on knowledge-based and evolutionary literatures. This study contributes to understanding of search for innovation in three ways. First, we argue that neither search effort nor search output is homogeneous, and acknowledging that there are different types of efforts and outputs may add clarity to research. In this study we distinguish between depth and scope of search effort, and radicality of search output. Second, this paper is one of the first studies to examine the search determinants of radical product innovation. There is relatively little prior work on how the development of radical innovation can be managed proactively (Iansiti, 1995), and how this search differs from the search for incremental innovations. In this study we argue that a large search scope and a diverse customer base can enhance search for radical products. Third, a better understanding of product innovation search has managerial implications. Technology managers who plan new product development activities can possibly benefit from understanding how the determinants of incremental and radical new product innovations differ. |
| | Keywords: product innovation; evolutionary search; knowledge |