21.06.2022New article in Academy of Management Review by Prof Keil

New article in Academy of Management Review by Prof Keil

The behavioral theory of the firm is among the most used theories in behavioral strategy. A central idea in the behavioral theory of the firm is that when an organization’s performance falls below aspirations, search is triggered. While this aspiration-based model has dominated the empirical literature, it is only one of two Carnegie School accounts of how firms use performance feedback to regulate behavior. A second model rooted, in later work of March, focuses on the characteristics of the choice alternatives faced by firms and the challenges inherent in evaluating them.

Using a computational approach, the paper by Professor Keil with Hart Posen (University of Wisconsin at Maddison, USA) and Maciej Workiewicz (ESSEC, France) demonstrates that the predictions of the belief-based model may explain prior inconsistent findings. The paper therefore integrates the two models into the Integrated Discovery and Evaluation of Alternatives (IDEA) model of problemistic search that allows to explain a broader range of empirical findings of past research and highlights the implications for empirical research on performance feedback and extensions to account for additional theoretical constructs such as affect and politics.