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The way organizations cope with uncertainty in strategic decision making is prominently discussed. Concepts such as heuristics and simple rules are gaining increasing attention in strategic management research. However, despite their importance, little is known how heuristics and simple rules operate. Our qualitative study reveals that, first, strategic decisions consist of three basic elements: single rules, rule patterns, and emotional handling. Second, we find that firms develop generalizable rule patterns which follow a sequential order of inter-linked rules. Based on the findings we introduce the concept of organizational heuristics as inter-linked rule patterns drawing on organizational experience.

The punctuated equilibrium model (PEM) is an influential model of organizational change that can both advance theory and guide managerial action. However, with the exception of Romanelli and Tushman’s (1994) study of minicomputer firms, the core assertion of the PEM – that fundamental organizational change would occur through brief, discontinuous, and simultaneous changes in all domains of organizational activity and not through incremental and asynchronous changes – has not been tested in longitudinal, large-sample research. We examined the event histories of 50 bank holding companies in the U.S. between 1975 and 1995, replicating Romanelli and Tushman’s test of the PEM in a less turbulent industry environment. Additionally, we examined the consequences of organizational transformation on subsequent firm performance, an aspect of the PEM that has seldom been studied. We found that both revolutionary and non-revolutionary change patterns were common means to accomplish organizational transformation. We also found that the installation of a new top executive not previously affiliated with the company and major shifts in the regulatory environment increased the likelihood of revolutionary transformation. Whereas severe performance declines before transformation decreased the likelihood of organizational transformation, the occurrence of revolutionary transformation did not significantly influence subsequent organizational performance.

This chapter combines insights from organizational theory and the entrepreneurship literature to inform a process-based conception of organizational founding. In contrast to previous discrete-event approaches, the conception argues that founding be viewed as a series of potential entrepreneurial activities – including initiation, resource mobilization, legal establishment, social organization, and operational startup. Drawing on an original data set of 591 entrepreneurs, the study examines the effect of structural, strategic, and environmental contingencies on the relative rates with which different founding activities are pursued. Results demonstrate that social context has a fairly pervasive impact on the occurrence and sequencing of founding processes, with one possible exception being the timing of legal establishment.

Boundaries are a popular topic among organizational researchers, many of whom argue that over the past decade we have witnessed a trend toward permeable boundaries and in some cases a blurring between organization and environment. Contrary to received wisdom, we argue that the question as to whether organizational boundaries have become more permeable or not cannot be decided empirically but is mainly a theoretical issue. Whether or not data indicate permeability or impermeability depends on the theoretical lens employed. Against this backdrop, we review how two prominent approaches to the study of boundaries, sociological systems theory and new institutionalism, not only arrive at different conclusions but also mandate diverging avenues of research. We focus in depth on several empirical trends: advances in information and communication technologies, increasingly dynamic fields and markets, invasive transparency regimes, and meta-organizations. We then introduce the contributions in this volume, showing how they elaborate on these and other empirical trends, drawing on different theoretical perspectives, to advance our understanding of the importance of boundaries within and around organizations.

The authors link High-Involvement Work Systems (HIWS) with social network research both theoretically and methodologically by conceiving of these work systems as networks and by using network methods to better understand and evaluate these arrangements. Their approach is to integrate the institutional perspective of industrial relations with the analytical methodology of social network analysis. They use a longitudinal data set collected before and after the introduction of an HIWS in a pharmaceutical company to measure the impact on patterns of employee communication as well as communication between the union and management. Improvements were found in customer satisfaction, and positive effects were seen in the pattern and structure of organizational communication with an increase in the density of lateral and vertical interdepartmental communication, and a decrease in hierarchy. These results were confirmed using survey data on employee perceptions of particular types of communication and interviews with employees at various levels of authority.

My purpose is to describe for strategic management scholars in Africa, particularly graduate students and new faculty members, dynamic analysis and its significance in the African context so as to assist in the study of dynamic phenomena.

I discuss various types and methods of dynamic analysis. Dynamic analysis has been used extensively in such fields as cognitive psychology, social psychology, and management in Western countries.

I illustrate the various dynamics by reviewing four illustrative studies. I also provide procedures for studying dynamics in the African context.

I discuss the strengths and limitations of dynamic analysis and suggest ways of maximizing its potential.

The technique is a source particularly for graduate students of strategy in Africa. They can use it to supplement other approaches in studying strategic management phenomena.

This chapter discusses a typology of dynamic analysis consistent with empirical or variable modeling approaches. The lack of such a typology in the context of Africa makes it a valuable contribution. Thus, it fills a contextual gap in the research methodology literature.