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Structural Inertia and Organizational Change Revisited III: The Evolution of Organizational Inertia

Author

Listed:
  • Hannan, Michael T.

    (Stanford U)

  • Polos, Laszlo

    (Lorand Eotvos U and Erasmus U Rotterdam)

  • Carroll, Glenn R.

    (Stanford U)

Abstract

Building on a formal theory of the structural aspects of organizational change initiated in Hannan, Polos, and Carroll (2002a, 2002b), this paper focuses on structural inertia. We define inertia as a persistent organizational resistance to changing architectural features. We examine the evolutionary consequences of architectural inertia. The main theorem holds that selection favors architectural inertia in the sense that the median level of inertia in cohort of organizations presumably increases over time. A second theorem holds that the selection intensity favoring architectural inertia is greater when foresight about the consequences of changes is more limited. According to the prior theory of Hannan, Polos, and Carroll (2002a, 2002b), foresight is limited by complexity and opacity. Thus it follows that the selection intensity favoring architectural inertia is stronger in populations composed of complex and opaque organizations that in those composed of simple and transparent ones.

Suggested Citation

  • Hannan, Michael T. & Polos, Laszlo & Carroll, Glenn R., 2002. "Structural Inertia and Organizational Change Revisited III: The Evolution of Organizational Inertia," Research Papers 1734, Stanford University, Graduate School of Business.
  • Handle: RePEc:ecl:stabus:1734
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    Cited by:

    1. Watanabe, Chihiro & Yong Hur, Jae & Lei, Shanyu, 2006. "Converging trend of innovation efforts in high technology firms under paradigm shift--a case of Japan's electrical machinery," Omega, Elsevier, vol. 34(2), pages 178-188, April.
    2. repec:spr:manint:v:47:y:2007:i:5:d:10.1007_s11575-007-0038-9 is not listed on IDEAS
    3. Paola Criscuolo & Rajneesh Narula, 2007. "Using multi-hub structures for international R&D: Organisational inertia and the challenges of implementation," Management International Review, Springer, vol. 47(5), pages 639-660, September.

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