Strategy and competitor cognition: an exploratory study of cognitive maps of competition held by 'inside' and  'outside'  industry actors

Shivasharan S. Nadavulakere; Anushri Rawat

doi:10.65301/dias.2011.8.1.322

Articles 15th Edition of DTR Apr 2011 – Sep 2011

DOI 10.65301/dias.2011.8.1.322

Strategy and competitor cognition: an exploratory study of cognitive maps of competition held by 'inside' and 'outside' industry actors

Authors

SH

Shivasharan S. Nadavulakere

AN

Anushri Rawat

90 Views

128 Downloads

Published 2011-04-30

Pages 38-47

Abstract

The study exam inesperceived similarities/dissimilarities between mental models o f com petition o f industry 'insiders' (managers of
competing organizations) and industry 'outsiders' (e.g. consultants an d analysts). The mental models of competition of industry actors' o f retail ban kin g w ere elicited using the full context form o f the repertory grid. Results indicate the existence of homogeneous mental models of competitive space between 'industry outsiders' and 'industry insiders'. These findings support 'social constructionist' explanations o f competitive structures in markets an d industries. Interpreting the results, we argue (a) that managers can rely on 'industry outsiders' assessments o f competitive space and (b) managers can actively interact with 'industry outsiders' to ensure that beliefs o f all industry participants cohere on a similar platform , thus creating less ambiguous marketfields.

Keywords

Cognitive Strategy Managerial Cognition Competitor Dynamics Mental Models

References

Anand, N., & Peterson, R. A. 2000. When market information constitutes fields: Sensemaking of markets in the commercial music industry. Organization Science, 11(3): 270-284.
Bannister, D., & Mair, J. M. M. 1968. The Evaluation of Personal Constructs. New York: Academic Press.
Bogner, W. C., & Thomas, H. 1993. The role of competitive groups in strategy formulation: A dynamic integration of two competing models. Journal of Management Studies, 30(1): 51–67.
Calori, R., Johnson, G., & Samin, P. 1992. French and British managers understanding of the structure and dynamics of their industries: A cognitive analysis and comparison. British Journal of Management, 3(2): 61–78.
Chen, M. J., Farh, J. L., & MacMillan, I. C. 1993. An exploration of the “Expertness” of outside informants. Academy of Management Journal, 36: 1614–1632.
Clark, B. H., & Montgomery, D. B. 1999. Managerial identification of competitors. Journal of Marketing, 63(3): 67–83.
Daniels, K., De Chernatony, L., & Johnson, G. 1994. Differences in the cognitive models of buyers and sellers. British Journal of Management, 5 (Special Issue): S21–30.
Daniels, K., Johnson, G., & De Chernatony, L. 2002. Task and institutional influences on managers’ mental models of competition. Organization Studies, 23(1): 31–62.
De Chernatony, L. 1989. Marketers and consumers’ perceptions of market structure. European Journal of Marketing, 23(1): 7–16.
De Chernatony, L., Daniels, K., & Johnson, G. 1993a. A cognitive perspective on managers’ perceptions of competition. Journal of Marketing Management, 9: 373–381.
De Chernatony, L., Daniels, K., & Johnson, G. 1993b. Competitive positioning strategies: Mirroring sellers’ and buyers’ perceptions? Journal of Strategic Marketing, 1: 229–248.
Easton, G., Burrell, G., Rothschild, R., & Shearman, C. 1993. Managers and Competition. Oxford, UK: Blackwell Business.
Eden, C., & Ackermann, F. 1998. Analysing and comparing idiographic causal maps. In C. Eden & J.-C. Spender (eds.), Managerial and Organizational Cognition: Theory, Methods and Research: 130–146. Thousand Oaks: Sage.
Ginsberg, A. 1989. Construing the business portfolio: A cognitive model of diversification. Journal of Management Studies, 26(4): 417–438.
Gripsrud, G., & Gronhaug, K. 1985. Structure and strategy in grocery retailing: A sociometric approach. Journal of Industrial Economics, 33(3): 339–347.
Hair Jr., J. F., Anderson, R. E., Tatham, R. L., & Black, W. C. 1992. Multivariate Data Analysis with Readings. New York: Macmillan Publishing Company.
Hambrick, D. C., & Mason, P. A. 1984. Upper echelons: The organization as a reflection of its top managers. Academy of Management Review, 9(2): 193–206.
Hodgkinson, G. P. 1997. The cognitive analysis of competitive structures: A review and critique. Human Relations, 50(6): 977–985.
Hodgkinson, G. P., & Johnson, G. 1994. Exploring the mental models of competitive strategists: The case for a processual approach. Journal of Management Studies, 31(4): 525–551.
Hodgkinson, G. P., Tomes, A. E., & Padmore, J. 1996. Using consumers’ perceptions for the cognitive analysis of corporate-level competitive structures. Journal of Strategic Marketing, 4: 1–22.
Huff, A. S. 1990. Mapping Strategic Thought. Chichester: John Wiley & Sons.
Johnson, E., Daniels, K., & Asch, R. 1998. Mental models of competition. In C. Eden & J.-C. Spender (eds.), Managerial and Organizational Cognition: 130–146. Thousand Oaks, CA: Sage.
Lant, T. K., & Baum, J. A. C. 1995. Cognitive sources of socially constructed competitive groups: Examples from the Manhattan hotel industry. In W. R. Scott & S. Christensen (eds.), The Institutional Construction of Organization (International and Longitudinal Studies): 15–38. Thousand Oaks, CA: Sage.
Levenhagen, M., Porac, J. F., & Thomas, H. 1993. Emergent industry leadership and the selling of technological visions: A social constructionist view. In J. Hendry, G. Johnson & J. Newton (eds.), Strategic Thinking: Leadership and the Management of Change: 69–87. Chichester: Wiley.
Narayanan, V. K., Zane, L. J., & Kemmerer, B. 2011. The cognitive perspective in strategy: An integrative review. Journal of Management, 37(1): 305–351.
Norusis, M. J. 1994. SPSS Advanced Statistics 6.1. Chicago: SPSS Inc.
Porac, J. F., Thomas, H., & Baden-Fuller, C. 1989. Competitive groups as cognitive communities: The case of Scottish knitwear manufacturers. Journal of Management Studies, 26(4): 397–416.
Porac, J. F., & Thomas, H. 1990. Taxonomic mental models of competitor definition. Academy of Management Review, 15(2): 224–240.
Porac, J. F., & Thomas, H. 1994. Cognitive categorisation and subjective rivalry among retailers in a small city. Journal of Applied Psychology, 79(1): 54–66.
Porac, J. F., Thomas, H., Wilson, F., Paton, D., & Kanfer, A. 1995. Rivalry and the industry model of Scottish knitwear producers. Administrative Science Quarterly, 40(2): 203–227.
Porter, M. E. 1980. Competitive Strategy: Techniques for Analyzing Industries and Competitors. New York: Free Press.
Reger, R. K. 1990. Managerial thought structures and competitive positioning. In A. S. Huff (ed.), Mapping Strategic Thought: 71–88. Chichester: John Wiley & Sons.
Reger, R. K., & Huff, A. S. 1993. Strategic groups: A cognitive perspective. Strategic Management Journal, 14(2): 103–124.
Reger, R. K., & Palmer, T. B. 1996. Managerial categorisation of competitors: Using old maps to navigate new environments. Organization Science, 5: 322–339.
Schwenk, C. 1988. The Essence of Strategic Decision Making. Lexington: Lexington Books.
Smircich, L., & Stubbart, C. L. 1985. Strategic management in an enacted world. Academy of Management Review, 10(4): 724–736.
Spencer, B. A., Peyrefitte, J., & Churchman, R. 2003. Consensus and divergence in perceptions of cognitive strategic groups: Evidence from the health care industry. Strategic Organization, 1(2): 203–223.
Spender, J.-C. 1989. Industry Recipes: The Nature and Sources of Managerial Judgement. Oxford: Basil Blackwell.
Stubbart, C. L. 1989. Managerial cognition: A missing link in strategic management research. Journal of Management Studies, 26(4): 325–347.
Thomas, H., & Pollock, T. 1999. From I-O economics’ S-C-P paradigm through strategic groups to competence-based competition: Reflections on the puzzle of competitive strategy. British Journal of Management, 10(2): 127–140.
Thomas, H., & Venkatraman, N. 1988. Research on strategic groups: Progress and prognosis. Journal of Management Studies, 25: 537–555.
Tyler, B. B., & Gnyawali, D. R. 2009. Managerial collective cognitions: An examination of similarities and differences of cultural orientations. Journal of Management Studies, 46(1): 93–126.
Walton, E. 1986. Managers prototypes of financial firms. Journal of Management Studies, 23: 679–698.
Whitley, R. 1992. The social construction of organizations and markets: The comparative analysis of business recipes. In M. Reed & M. Hughes (eds.), Rethinking Organization: New Directions in Organization Theory and Analysis: 120–143. London: Sage.

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Shivasharan S. Nadavulakere, Anushri Rawat . (2011). Strategy and competitor cognition: an exploratory study of cognitive maps of competition held by 'inside' and 'outside' industry actors. DIAS Technology Review, 8(1), 38-47.

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[1] Anand, N., & Peterson, R. A. 2000. When market information constitutes fields: Sensemaking of markets in the commercial music industry. Organization Science, 11(3): 270-284.

[2] Bannister, D., & Mair, J. M. M. 1968. The Evaluation of Personal Constructs. New York: Academic Press.

[3] Bogner, W. C., & Thomas, H. 1993. The role of competitive groups in strategy formulation: A dynamic integration of two competing models. Journal of Management Studies, 30(1): 51–67.

[4] Calori, R., Johnson, G., & Samin, P. 1992. French and British managers understanding of the structure and dynamics of their industries: A cognitive analysis and comparison. British Journal of Management, 3(2): 61–78.

[5] Chen, M. J., Farh, J. L., & MacMillan, I. C. 1993. An exploration of the “Expertness” of outside informants. Academy of Management Journal, 36: 1614–1632.

[6] Clark, B. H., & Montgomery, D. B. 1999. Managerial identification of competitors. Journal of Marketing, 63(3): 67–83.

[7] Daniels, K., De Chernatony, L., & Johnson, G. 1994. Differences in the cognitive models of buyers and sellers. British Journal of Management, 5 (Special Issue): S21–30.

[8] Daniels, K., Johnson, G., & De Chernatony, L. 2002. Task and institutional influences on managers’ mental models of competition. Organization Studies, 23(1): 31–62.

[9] De Chernatony, L. 1989. Marketers and consumers’ perceptions of market structure. European Journal of Marketing, 23(1): 7–16.

[10] De Chernatony, L., Daniels, K., & Johnson, G. 1993a. A cognitive perspective on managers’ perceptions of competition. Journal of Marketing Management, 9: 373–381.

[11] De Chernatony, L., Daniels, K., & Johnson, G. 1993b. Competitive positioning strategies: Mirroring sellers’ and buyers’ perceptions? Journal of Strategic Marketing, 1: 229–248.

[12] Easton, G., Burrell, G., Rothschild, R., & Shearman, C. 1993. Managers and Competition. Oxford, UK: Blackwell Business.

[13] Eden, C., & Ackermann, F. 1998. Analysing and comparing idiographic causal maps. In C. Eden & J.-C. Spender (eds.), Managerial and Organizational Cognition: Theory, Methods and Research: 130–146. Thousand Oaks: Sage.

[14] Ginsberg, A. 1989. Construing the business portfolio: A cognitive model of diversification. Journal of Management Studies, 26(4): 417–438.

[15] Gripsrud, G., & Gronhaug, K. 1985. Structure and strategy in grocery retailing: A sociometric approach. Journal of Industrial Economics, 33(3): 339–347.

[16] Hair Jr., J. F., Anderson, R. E., Tatham, R. L., & Black, W. C. 1992. Multivariate Data Analysis with Readings. New York: Macmillan Publishing Company.

[17] Hambrick, D. C., & Mason, P. A. 1984. Upper echelons: The organization as a reflection of its top managers. Academy of Management Review, 9(2): 193–206.

[18] Hodgkinson, G. P. 1997. The cognitive analysis of competitive structures: A review and critique. Human Relations, 50(6): 977–985.

[19] Hodgkinson, G. P., & Johnson, G. 1994. Exploring the mental models of competitive strategists: The case for a processual approach. Journal of Management Studies, 31(4): 525–551.

[20] Hodgkinson, G. P., Tomes, A. E., & Padmore, J. 1996. Using consumers’ perceptions for the cognitive analysis of corporate-level competitive structures. Journal of Strategic Marketing, 4: 1–22.

[21] Huff, A. S. 1990. Mapping Strategic Thought. Chichester: John Wiley & Sons.

[22] Johnson, E., Daniels, K., & Asch, R. 1998. Mental models of competition. In C. Eden & J.-C. Spender (eds.), Managerial and Organizational Cognition: 130–146. Thousand Oaks, CA: Sage.

[23] Lant, T. K., & Baum, J. A. C. 1995. Cognitive sources of socially constructed competitive groups: Examples from the Manhattan hotel industry. In W. R. Scott & S. Christensen (eds.), The Institutional Construction of Organization (International and Longitudinal Studies): 15–38. Thousand Oaks, CA: Sage.

[24] Levenhagen, M., Porac, J. F., & Thomas, H. 1993. Emergent industry leadership and the selling of technological visions: A social constructionist view. In J. Hendry, G. Johnson & J. Newton (eds.), Strategic Thinking: Leadership and the Management of Change: 69–87. Chichester: Wiley.

[25] Narayanan, V. K., Zane, L. J., & Kemmerer, B. 2011. The cognitive perspective in strategy: An integrative review. Journal of Management, 37(1): 305–351.

[26] Norusis, M. J. 1994. SPSS Advanced Statistics 6.1. Chicago: SPSS Inc.

[27] Porac, J. F., Thomas, H., & Baden-Fuller, C. 1989. Competitive groups as cognitive communities: The case of Scottish knitwear manufacturers. Journal of Management Studies, 26(4): 397–416.

[28] Porac, J. F., & Thomas, H. 1990. Taxonomic mental models of competitor definition. Academy of Management Review, 15(2): 224–240.

[29] Porac, J. F., & Thomas, H. 1994. Cognitive categorisation and subjective rivalry among retailers in a small city. Journal of Applied Psychology, 79(1): 54–66.

[30] Porac, J. F., Thomas, H., Wilson, F., Paton, D., & Kanfer, A. 1995. Rivalry and the industry model of Scottish knitwear producers. Administrative Science Quarterly, 40(2): 203–227.

[31] Porter, M. E. 1980. Competitive Strategy: Techniques for Analyzing Industries and Competitors. New York: Free Press.

[32] Reger, R. K. 1990. Managerial thought structures and competitive positioning. In A. S. Huff (ed.), Mapping Strategic Thought: 71–88. Chichester: John Wiley & Sons.

[33] Reger, R. K., & Huff, A. S. 1993. Strategic groups: A cognitive perspective. Strategic Management Journal, 14(2): 103–124.

[34] Reger, R. K., & Palmer, T. B. 1996. Managerial categorisation of competitors: Using old maps to navigate new environments. Organization Science, 5: 322–339.

[35] Schwenk, C. 1988. The Essence of Strategic Decision Making. Lexington: Lexington Books.

[36] Smircich, L., & Stubbart, C. L. 1985. Strategic management in an enacted world. Academy of Management Review, 10(4): 724–736.

[37] Spencer, B. A., Peyrefitte, J., & Churchman, R. 2003. Consensus and divergence in perceptions of cognitive strategic groups: Evidence from the health care industry. Strategic Organization, 1(2): 203–223.

[38] Spender, J.-C. 1989. Industry Recipes: The Nature and Sources of Managerial Judgement. Oxford: Basil Blackwell.

[39] Stubbart, C. L. 1989. Managerial cognition: A missing link in strategic management research. Journal of Management Studies, 26(4): 325–347.

[40] Thomas, H., & Pollock, T. 1999. From I-O economics’ S-C-P paradigm through strategic groups to competence-based competition: Reflections on the puzzle of competitive strategy. British Journal of Management, 10(2): 127–140.

[41] Thomas, H., & Venkatraman, N. 1988. Research on strategic groups: Progress and prognosis. Journal of Management Studies, 25: 537–555.

[42] Tyler, B. B., & Gnyawali, D. R. 2009. Managerial collective cognitions: An examination of similarities and differences of cultural orientations. Journal of Management Studies, 46(1): 93–126.

[43] Walton, E. 1986. Managers prototypes of financial firms. Journal of Management Studies, 23: 679–698.

[44] Whitley, R. 1992. The social construction of organizations and markets: The comparative analysis of business recipes. In M. Reed & M. Hughes (eds.), Rethinking Organization: New Directions in Organization Theory and Analysis: 120–143. London: Sage.