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Structural Inertia and Organizational Change Revisited II: Complexity, Opacity, and Change

Author

Listed:
  • Hannan, Michael T.

    (Stanford U)

  • Polos, Laszlo

    (Lorand Eotvos U and Erasmus U Rotterdam)

  • Carroll, Glenn R.

    (Stanford U)

Abstract

This paper extends a formal theory of structural aspects of organizational change initiated by Hannan, Polos, and Carroll (2002a, hereafter HPCa). This analysis focuses on the implications of limited foresight of the cascades of consequences of architectural changes. Foresight is generally limited by complexity (defined with respect to calculative capacity of actors) and opacity (defined with respect to the presence of enclaves). Complexity and opacity lead actors to underestimate the lengths of periods of reorganization and the associated costs of change, thereby prompting them to undertake changes with adverse consequences. The key theorem holds that the deleterious consequences of architectural change increase with an organization's complexity and opacity.

Suggested Citation

  • Hannan, Michael T. & Polos, Laszlo & Carroll, Glenn R., 2002. "Structural Inertia and Organizational Change Revisited II: Complexity, Opacity, and Change," Research Papers 1733, Stanford University, Graduate School of Business.
    • Handle: RePEc:ecl:stabus:1733
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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. Schweizer, T.S., 2002. "Managing interactions between technological and stylistic innovation in the media industries, insights from the introduction of ebook technology in the publishing industry," ERIM Report Series Research in Management ERS-2002-16-ORG, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    3. Hannan, Michael T. & Polos, Laszlo & Carroll, Glenn R., 2002. "Structural Inertia and Organizational Change Revisited I: Architecture, Culture and Cascading Change," Research Papers 1732, Stanford University, Graduate School of Business.
    4. Joonho Shin & Xavier Mendoza & Changbum Choi, 2022. "Do internationalizing business group affiliates perform better after promarket reforms? Evidence from Korean SMEs," Asia Pacific Journal of Management, Springer, vol. 39(2), pages 805-841, June.
    5. Klein Woolthuis, R. & Nooteboom, B., 2002. "Trust and Formal Control in interorganizational Relationships," ERIM Report Series Research in Management ERS-2002-13-ORG, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    6. Krug, B. & Hendrischke, H., 2002. "Entrepreneurship in China: Institutions, organisational identity and survival: empirical results from two provinces," ERIM Report Series Research in Management ERS-2002-14-ORG, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    7. Akalu, M.M. & Turner, J.R., 2002. "Investment Appraisal Process in the Banking & Finance Industry," ERIM Report Series Research in Management ERS-2002-17-ORG, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.

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