Journal
STRATEGIC MANAGEMENT JOURNAL
Volume 39, Issue 4, Pages 1031-1058Publisher
WILEY
DOI: 10.1002/smj.2774
Keywords
adaptive decision-making; cognitive flexibility; dual-process theory; ill-structured problems; think-aloud protocols
Categories
Funding
- Swiss National Science Foundation [100018_156196]
Ask authors/readers for more resources
Research Summary: How can strategic decision makers overcome inertia when dealing with change? In this article we argue that cognitive flexibility (i.e., the ability to match the type of cognitive processing with the type of problem at hand) enables decision makers to achieve significantly higher decision-making performance. We show that superior decision-making performance is associated with using semiautomatic Type 1 cognitive processes when faced with well-structured problems, and more deliberative Type 2 processes when faced with ill-structured problems. Our findings shed light on the individual-level mechanism behind organizational adaptation and complement recent work on strategic inertia. In addition, our findings extend management studies that have stressed the relevance of cognitive flexibility for responding to the demands of increasingly open, flexible, and rapidly changing organizations. Managerial Summary: Humans are creatures of habits. We tend to prefer known courses of action over new ones. In many cases, habits are good. However, when things change in unpredictable ways, the past may not be good guidance for the future. We argue that cognitive flexibilitythe ability of understanding when to rely on habits vs. when to explore new courses of actionenables managers to switch from a fast decision mode, based on habits, to a slow, more deliberate decision mode that facilitates the exploration of new courses of action. Managers high in cognitive flexibility reflect on the situation at hand, recognize and value diversity in viewpoints, and integrate such diversity in their own decision processes. By valuing diversity, they are more likely to overcome inertia.
Authors
I am an author on this paper
Click your name to claim this paper and add it to your profile.
Reviews
Recommended
No Data Available