Coevolution of Firm Capabilities and Industry Competition

This paper proposes that rival firms not only search for new capabilities within their organization, but also for those that rest in their competitive environment. An integrated analysis of these search processes at both firm and industry levels of analysis shows how their interaction makes industries and firms coevolve over time. To contribute to an enhanced understanding of the concept of coevolution, a dynamic and integrative framework crossing meso and micro levels of analysis is constructed. This framework is applied to a longitudinal study of the music industry with a time-span of 120 years. The first part, a historical study, covers the period 1877 - 1990. The second part, a multiple-case study, covers the period 1990 - 1997. We conclude that search behavior drives coevolution through competitive dynamics among new entrants and incumbent firms and manifests itself in the simultaneous emergence of new business models and new organizational forms.coevolution;competitive regime;longitudinal research;multilevel research;music industry

Vaart houden in het strategisch proces

Hoe behoudt het bestuur van een grote complexe organisatie vaart in het bedenken en uitvoeren van strategische veranderingen? Dat is geen gemakkelijke opgave als er geen aanwijsbare dreigingen van buitenaf zijn en er geen duidelijke aanleiding is om algemene strategische maatregelen te nemen. De auteurs onderzoeken de inherente spanningen tussen stabiliteit en verandering. Verandering is noodzakelijk, wil men op langere termijn succes boeken, maar te veel verandering is desastreus. Volgens de auteurs zijn er verscheidene mogelijke oplossingen voor deze paradox. Een daarvan is het genereren van uiterst actieve perioden, gevolgd door relatief stabiele perioden en perioden waarin de vooruitgang gestaag verloopt. Aan de hand van de bezinningen van een bestuursvoorzitter van Unilever - die deze functie van 1984 tot 1994 uitoefende - onderzoeken de auteurs hoe men met deze spanningen omgaat en een oplossing zoekt

Maintaining strategic momentum

The question of how the CEO of a large complex organization maintain strategic momentum is addressed. This represents a great challenge when there are no obvious external threats, and no obvious reasons for having a concerted action. The inherent tensions which exist between stability and change are explored. Change is necessary to maintain success, but too much change is disastrous. It is argued that there are several possible solutions to this paradox, including that of generating periods of intense activity followed by periods of comparative stability and incremental improvement. The introspection of one of the CEOs of Unilever is used to show how these tensions were played out and resolved

Coevolution of Firm Capabilities and Industry Competition

This paper proposes that rival firms not only search for new capabilities within their organization, but also for those that rest in their competitive environment. An integrated analysis of these search processes at both firm and industry levels of analysis shows how their interaction makes industries and firms coevolve over time. To contribute to an enhanced understanding of the concept of coevolution, a dynamic and integrative framework crossing meso and micro levels of analysis is constructed. This framework is applied to a longitudinal study of the music industry with a time-span of 120 years. The first part, a historical study, covers the period 1877 - 1990. The second part, a multiple-case study, covers the period 1990 - 1997. We conclude that search behavior drives coevolution through competitive dynamics among new entrants and incumbent firms and manifests itself in the simultaneous emergence of new business models and new organizational forms

Investigating Strategic Renewal of Five Large Dutch Financial Services Firms

How do large well-established firms renew themselves in an increasing turbulent environment? Is there a generic pattern of change or is each change journey rather idiosyncratic? We posed five questions about the nature of renewal patterns. First, how do firms combine external versus internal initiatives in a trajectory of strategic renewal? Second, how does the balance of competence building and competence leveraging evolve in a trajectory of strategic renewal? Third, what are the sequences of action in a strategic renewal process? Fourth, do firms differ regarding speed of their renewal processes? Finally, do different strategic renewal trajectories give rise to different of similar outcomes? Using a simple framework and new metrics we described and analyzed the strategic renewal journeys of the five largest financial service firms in the Netherlands during the period 1990-1997. We found equifinality in viable trajectories of strategic renewal. In four out of five firms, they result in similar outcomes due to mimetic behaviour. Nonetheless, one firm showed deviant strategic behaviour

Investigating Strategic Renewal of Five Large Dutch Financial Services Firms

How do large well-established firms renew themselves in an increasing turbulent environment? Is there a generic pattern of change or is each change journey rather idiosyncratic? We posed five questions about the nature of renewal patterns. First, how do firms combine external versus internal initiatives in a trajectory of strategic renewal? Second, how does the balance of competence building and competence leveraging evolve in a trajectory of strategic renewal? Third, what are the sequences of action in a strategic renewal process? Fourth, do firms differ regarding speed of their renewal processes? Finally, do different strategic renewal trajectories give rise to different of similar outcomes? Using a simple framework and new metrics we described and analyzed the strategic renewal journeys of the five largest financial service firms in the Netherlands during the period 1990-1997. We found equifinality in viable trajectories of strategic renewal. In four out of five firms, they result in similar outcomes due to mimetic behaviour. Nonetheless, one firm showed deviant strategic behaviour.strategic renewal;competence building vs. competence leveraging;financial services firms

Common beliefs Constraint or opportunity?; the case of Scottish knitwear manufacturers

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