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Cognition and Capabilities: Opportunities Seized and Missed in the History of the Computer Industry

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  • Richard N. Langlois

    (The University of Connecticut)

Despite the enormous literature devoted to the subject, there remains little consensus about the organizational sources of innovativeness and inertia. On the one hand, the evolutionary or "capabilities" view of the firm leads us naturally to expect organizational inertia as a natural by- product of competitive success, especially in complex, highly articulated firms. On the other hand, there is a tradition within what is broadly the same view of the firm that stresses the advantages for innovation of large, professionally managed firms over the "personal capitalism" of smaller, more synoptically managed enterprises. This paper attempts to develop a perspective on the debate by treating the organization as a cognitive structure within an evolutionary capabilities framework. It then canvasses the history of the computer industry for empirical examples. That history includes a diversity of organizational types confronting -- both successfully and unsuccessfully -- a significant number of cases of technological opportunity. The central conclusion of the paper is that innovativeness and inertia are not so much results of organizational form considered a priori but rather of the "fit" between the cognitive structure of the organization and the structure of the economic change the opportunity implies.

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Paper provided by EconWPA in its series Industrial Organization with number 9406003.

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Length: 40 pages
Date of creation: 30 Jun 1994
Handle: RePEc:wpa:wuwpio:9406003
Note: 40 pages. To appear in Cynthia A. Montgomery, ed., Evolutionary and Resource-based Approaches to Strategy. Dordrecht: Kluwer Academic Publishers, 1995.
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