One of the most enduring puzzles in the strategy literature is the negative association between risk and return known as the Bowman paradox. This paper formalizes a model of strategic conduct based on the concept of strategic fit and the heterogeneity of firm strategic capabilities. This model...

Goals and the performance feedback on those goals are fundamental to organizational learning and adaptation. However, most research has focused on single overall, high-level organizational goals, while ignoring important operational goals farther down in the goal hierarchy. This paper explores...

This study draws attention to the impact of prior board experiences on the variation in new insider CEOs' degree of “insiderness” in terms of commitment to the status quo and their propensity to make strategic change. We theorize and find that new insider CEOs' prior board experience at the...

One important assumption in various theories of organizations is that organizations learn and adjust their behavior in response to past experience. Indeed, the behavioral theory of the firm posits that organizations exhibit adaptive behavior over time. One key element in the adaptive learning...

Organizations learn and adapt their aspiration levels based on reference points (prior aspiration, prior performance, and prior performance of reference groups). The relative attention that organizations allocate to these reference points impacts organizational search and strategic decisions....

Behavioral Theory highlights the crucial role of social comparisons in attention allocation in adaptive aspirations. Yet, both the specification of social reference points and the dynamics of attention allocation have received little scholarly examination. We address performance feedback from...

Goals or aspirations and their relationships to risk taking and performance are important issues in both psychology and strategic management. The concept of adaptive aspirations, as discussed in Cyert and March's Behavioral Theory of the Firm, has long been a topic of interest in both fields....