Path dependence and the stabilization of strategic premises: how the funeral industry buries itself

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Several studies have shown that path-dependent organizations may pathologically reproduce their paths even in times of crisis. The unchallenged retention of underlying strategic premises seems to play a key role in this self-destructive process. Whereas the previous literature largely assumes that organizational crises provide sufficient impetus for updating strategic premises, recent empirical studies have highlighted that path-dependent organizations may find this highly difficult. In the present study, I explore how path-dependent organizations stabilize strategic premises even in times of crisis. Drawing on a case study of the funeral industry, I theoretically distill four mechanisms that stabilize strategic premises in path-dependent organizations despite the fierce pressures of organizational crises. While these mechanisms constitute either reflexive modes of processing feedback or generative modes of producing market outcomes, they all inhibit a disconfirmation and, thus, an update of strategic premises. Furthermore, the study presents indicative evidence of how this unchallenged retention of strategic premises leads to the pathological reproduction of the path.

Original languageEnglish
JournalBusiness Research
Issue number2
Pages (from-to)265-299
Number of pages35
Publication statusPublished - 01.12.2015
Externally publishedYes

Bibliographical note

Acknowledgments The author would like to thank Business Research Department Editor Thomas Hutzschenreuter and the two anonymous reviewers for their helpful advice to improve this manuscript. The author is also indebted to Leonhard Dobusch, Johann Fortwengel, Arne Keller, Jochen Koch, Wasko Rothmann, Thomas Schmidt, Georg Schreyögg, Jörg Sydow, and Heinz-Theo Wagner for their thoughtful comments on earlier versions of this manuscript. Furthermore, the author thanks the Dieter Schwarz Foundation for funding this research project.

    Research areas

  • Management studies - Funeral industry, Lock-in, Path dependence, Stability, Strategic premises