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Organizational Learning from Performance Feedback : A Behavioral Perspective on Innovation and Change

Organizational Learning from Performance Feedback : A Behavioral Perspective on Innovation and Change

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Book DescriptionRevisiting Cyert and March's classic 1963 "Behavioral Theory of the Firm", Henrich Greve offers an intriguing analysis of how firms evolve in response to feedback about their own performance. Based on ideas from organizational theory and social psychology and research from many industries, it demonstrates that high-performing organizations quickly lower their rates of market entry, innovations and asset growth, but low-performing organizations only slowly increase those rates. The analysis outlines the consequences of this behavior for organizational survival and performance, and suggests ways to improve organizations with performance feedback.Download DescriptionRevisiting Cyert and March's classic 1963 'Behavioral Theory of the Firm', Henrich Greve offers an intriguing analysis of how firms evolve in response to feedback about their own performance. Based on ideas from organizational theory, social psychology, and economics, he explains how managers set goals, evaluate performance, and determine strategic changes. Drawing on a range of recent studies, including the author's own analysis of the Japanese shipbuilding industry, he reports on how theory fits current evidence on organizational change of risk-taking, research and development expenses, innovativeness, investment in assets, and in market strategy. The findings suggest that high-performing organizations quickly reduce their rates of change, but low-performing organizations only slowly increase those rates. Analysis of performance feedback is an important new direction for research and this book provides valuable insights in how organizational learning interacts with other influences on organizational behaviour such as competitive rivalry and institutional influences.