Individual environmental scanning as a barrier to collective processes in organizations

Purpose - The purpose of this paper is to understand how illusion of control (IOC) can affect the implementation of formal processes of environmental scanning in organizations. Design/methodology/approach - Based on the proposed research question, an exploratory study was chosen, which could collaborate with future studies. There were conducted three semi-structured interviews with CEOs working in medium/large technology companies. Findings - Behavioral traits were identified—such as overconfidence and underestimation of risks—which are directly related to the IOC’s theory. The belief that there is no added value to the company in adopting organizational strategic processes—such as environmental scanning—answers the research question and contributes to the development of new studies. Research limitations/implications - This study has as limitation the fact that it proposed the interviews to an inexpressive number of respondents, exclusively with the intention to explore better the relation between the IOC and the formal processes of environmental scanning. Practical implications - This research advances the understanding of the difficulty in adopting formal environmental scanning practices in organizations. It can also help understand the motivations of executives for adopting (or not adopting) such practices. Finally, it is possible to know and understand the individual approach to environmental scanning, as well as its limitations. Originality/value - This research discusses the themes of IOC and environmental scanning, demonstrating how cognitive factors can affect strategic decision making in an organization. Although the IOC is well-developed in the field of psychology, it can be very helpful in understanding business management and executive behavior.