Henrich Greve

INSEAD | INSEAD · Area of Entrepreneurship and Family Enterprise

Conspiracy theories are a constant feature of human society but have recently risen in prominence with the flurry of COVID-19 conspiracy theories and their public display in social media. Conspiracy theories should be studied not only because of their potential harm but also because they are related to other sources of misinformation such as folk t...

Cultural industries help build creativity-based economies and stimulate worldwide cultural interchanges, but this process faces constraints. One such constraint is unequal treatment of genders. When female artists export cultural products, they face a “liability of gender”, defined as gender specific difficulties in overcoming the liability of fore...

Organizational goals are assigned to individuals, and thus differ from goals that individuals voluntarily adopt. The Carnegie School has a significant research stream on how organizations are affected by goals, with a focus on how disappointing performance disrupts regular organizational behavior and triggers a search for alternative actions. We ha...

Conspiracies are consequential and social, yet online conspiracy groups that consist of individuals (and bots) seeking to explain events or a system have been neglected in sociology. We extract conspiracy talk about the COVID-19 pandemic on Twitter and use the biterm topic model (BTM) to provide a descriptive baseline for the discursive and social...

In the 20 years of Strategic Organization, how well has knowledge drawn from the behavioral theory of the firm contributed to the field of strategy? We see progress both in the pages of SO! and elsewhere in the field of strategy, but this progress has been held back by divisions between strategy and organization theory in what theories should predi...

This commentary to Waitzberg et al. (2021) draws on the research stream on organizational goals in management to examine the findings they report, point out the correspondence of their findings and interpretation with existing theory, including development beyond it. Their work discusses these considerations very well. It also suggests paths to fur...

Performance feedback research examines how performance relative to the aspiration level on one or more organizational goals influences organizational search and change. It views the organization as solving problems presented by performance shortfalls, consistent with bounded rationality. This chapter examines the start of my research on performance...

Influential management research often entails multiple research studies that build on each other to demonstrate a significant organizational phenomenon, to reveal the reasons and mechanisms that can explain the phenomenon, and to identify boundary conditions that may amplify or constrain the phenomenon. Such research is neither niche nor narrow; it...

The organizational view of strategic management views strategic decisions as outcomes of organizational goals and environmental influences. Central research streams are institutional theory and network theory on environmental influences, and learning theory and resource dependence theory on organizational interaction with the environment. Currently...

International business (IB) scholars' over-reliance on a select few theories leaves our understanding of firm internationalization incomplete. The behavioral theory of the firm (BTF) can offer new insights and can be used to model a broad range of firm actions. We focus on the three basic BTF components: problemistic search, learning by doing, and...

The resource-based view and learning theory have developed independently but still have important areas of theoretical overlap, especially in central assumptions, such as how organizational differences, path dependence, and complex social technologies shape strategy. In addition, they have divergent and complementary theory, with major differences...

There is an old soccer wisdom that a goal scored just before halftime has greater value than other goals. Many dismiss this old wisdom as just another myth waiting to be busted. To test which is right we have analysed the final score difference through linear regression and outcome (win, draw, loss) through logistic regression. We use games from ma...

Organizational learning theory examines how organizations change routine behaviors as a function of their goals and experience. Research built on learning theory has assembled much evidence on how organizations adapt to their environments (e.g., Gavetti, Greve, Levinthal and Ocasio, 2012). Learning acts both as an underlying assumption in other the...

This book synthesizes the current state of research on organizational learning from performance feedback and develops a new perspective that deals with the influence of multiple goals. In keeping with the centrality of motives in Cyert & March’s influential model, this new perspective rests on a foundation of individual level behaviors that are res...

The garbage can account of organizations where problems, solutions, and people chase each other is often invoked but rarely studied since its publication 44 years ago. It has been critiqued for being a metaphor rather than a model, and offering a deterministic rather than stochastic account. We reline the garbage can model of organizational decisio...

Rules regulate behavior, but in competitive contexts they also create incentives for rule-breaking because enforcement is imperfect. Sports is a prime example of this, and one that lends itself well to investigation because strategic rule-breaking is often measurable. Professional soccer is a highly competitive team sport with economic rewards for...

When organizational tasks require accurate decision-making, it is of interest to examine the quality of decisions in general, and specifically the conditions under which it deteriorates. Many important decisions are made by individuals at work who are hired to pursue organizational goals but also have individual goals, but the potential effects of...

In this study, we examine how multiple and sometimes conflicting goals are prioritized and pursued in organizations. Theories of coalitions and political behavior address prioritization among goals and changes in goal emphasis over time but cannot accurately predict the behavior of organizations that pursue conflicting goals. By linking theories of...

Research Abstract Media coverage is known to influence firms’ behavior, but it is less known whether coverage of firms’ partners also has an effect. In a context of governance practices’ diffusion in Canada, we distinguish the effect of direct media coverage of the firm’s activities, from indirect coverage, defined as media coverage of the firms’ i...

Problemistic search is a central part of behavioral strategy because it is a fundamental step in the decision process leading to strategic change. Despite the significant research efforts so far, there is a gap in our understanding of search. Unlike the theory of myopic search, most research so far has emphasized search initiated by performance rel...

Management journals publish research that can be divided into many fields and originate from many theories, but in one regard all are similar: the presentation of data according to professional conventions. The presentation of empirical findings expresses broad agreement across theories, fields of study, and researcher background, an agreement that...

Coalitions are important in organizational decision making, but the question of how coalitions are built and make decisions in response to firm performance is still not sufficiently explored. In this study, we develop and test theory on how potential coalitions are built through shared experience and recruitment of allies. When organizations respon...

This paper examines a paradox in the behavioral theory of the firm, and highlights how a complementary paradox from institutional theory suggests a theoretical integration with potential for significant progress. Current behavioral theory of the firm research has a strong record of showing a broad range of organizational changes in response to prof...

Community differences in organizing capacity have been attributed to cohesion and trust among population members and from population members to organizations and have been seen as an enduring feature of communities. The experience of a crisis, and the handling of the crisis, can be seen as a test of cohesion that verifies community support of organ...

Industry platforms can alter relations among exchange partners in such a way that the industry structure is changed. The focus of much industry platform research has been on how platform creation and leadership offers advantages to the most central firms, but platforms can also be advantageous for small specialist firms that compete with the most c...

Interorganizational evolution is the process of cumulative change in social structures composed of or affecting multiple organizations. Theory of interorganizational evolution specifies mutual and path dependent influences between organizations and their environment so that small differences in initial conditions can lead to large differences in th...

Using data from securities analysts, who are awarded status by the thirdparty organization Institutional Investor magazine, we examine the emergence of competition and articulate a model of competitive response among actors aware of the importance of status and some of the dimensions on which it may be gained. We predict analysts' initiating or cea...

In social theory, emergence is the process of novelty (1) creation, (2) growth, and (3) formation into a recognizable social object, process, or structure. Emergence is recognized as important for the existence of novel features of society such as new organizations, new practices, or new relations between actors. In this introduction to the volume...

Why are some communities resilient in the face of disasters, and why are others unable to recover? We suggest that two mechanisms matter: the framing of the cause of the disaster, and the community civic capacity to form diverse non-profits. We propose that disasters that are attributed to other community members weaken cooperation and reduce the f...

The state creates and changes rules that coerce firms, but firms can delay or decouple responses to rule changes to manage the cost of demands. Theory of compliance to the state has not yet considered the degree to which the firm can delay adoption because of low exposure to rules and state links that allow cooptation, but both of these relations b...

Organizational Wrongdoing is an essential companion to understanding the causes, processes and consequences of misconduct at work. With contributions from some of the world's leading management theorists, past theories on misconduct are critically evaluated, and the latest research is introduced, expanding the boundaries of our knowledge and fillin...

Deference within a dyad occurs when one partner acknowledges that the other is entitled to some privileges. Although deference is a well-known consequence of relationships between partners of unequal status, little is known on whether deference in one domain can affect interactions between the same actors in the other domains. This can happen withi...

Research summary: External stakeholders frequently attempt to influence organizations' adoption of new practices through the creation of public ratings. Based on the insights of performance feedback theory, we develop the theory of organizational reactions to external ratings to explain how firms' behaviors depend on their rating scores and their p...

Institutional theory has explained the greater prevalence of many strategic actions by increases in their legitimacy over time, but it has not explained how firms choose among actions backed by competing institutional logics. We address this topic by linking institutional logics with the theory of organizational coalitions and power to predict how...

This article is inspired by real-world phenomena that firms lose customers based on imprecise information and take a long time to recover. If consumers are playing an ordinary repeated game with fixed partners, there is no clear reason why recovery happens slowly. However, if consumers are playing an endogenously repeated game, a class of simple ef...

Behavioral theories of organization are a major portion of the field of organizational studies, as behavioral reasoning is found across a range of theoretical approaches. We review the role of behavioral theory in the major research traditions of organization theory, starting with the original behavioral theory of the firm and continuing to evoluti...

We examine the influence of the self-assessment and self-enhancement motives on the choice of comparison organizations in two experimental studies. Study 1 shows that: (1) self-assessment generally prevailed over self-enhancement, guiding decision makers to choose organizations that were more similar and had better performance; (2) self-enhancement...

The wide variation in the success of innovations obscures similarities in the process of firms being influenced by other firms when choosing production technology. We argue that diffusion processes are similar across successful and failed innovations. Production asset innovation success results not only from innovation quality differences. Early ch...

Research on resource dependence typically takes a static view in which actions and outcomes are determined structurally, but not as responses to the actions of the counterparty in an exchange relation. By contrast, this study addresses a question of power dynamics by examining whether mergers of organizations trigger responses from their common exc...

Organizational decision-making occurs when individuals or groups make decisions on behalf of an organization. Decision-making is integral to organized behavior in general, and to managerial work in particular. Theory of decision-making comes in different flavors depending on the number of decision-makers involved and whether multiple decision-maker...

The garbage can model is a simulation model of organizational Decision-Making under ambiguity.

Slack resources are resources in excess of what is required to reward the dominant coalition that governs the organization.

For many years, scholars have used a variety of models to measure organizational aspirations, but these alternative measures reflect differing assumptions about the decision-making processes determining aspiration levels. This study begins by examining some of the implications of the aspiration models in use. It then extends the theoretical model o...

Explanations of team performance typically involve theory on how knowledge diversity provides the team with useful information and interpretations while team cohesion ensures that it will be effectively applied. In spite of clear theoretical expectations, the research has some inconsistencies in findings that can be addressed through careful modeli...

Community reactions against organizations can be driven by negative information spread through a diffusion process that is distinct from the diffusion of organizational practices. Bank panics offer a classic example of selective diffusion of negative information. Bank panics involve widespread bank runs, although a low proportion of banks experienc...

An important source of organizational variation in communities is institutional legacies: institutions that persist and affect the community over long periods of time. Institutional legacies have received attention in the past, but recently there has been increased interest in their origins and effects. We examine three carriers of institutional le...

The study: Henrich Greve and Marc-David Seidel studied the role of first-mover advantage in determining which technologies get adopted and which do not. They tracked the sales history of two wide-body jets: the McDonnell Douglas DC-10 and the Lockheed L-1011 TriStar. The researchers concluded that the DC-10's one-year head start contributed to its...

PurposeThis chapter tests whether adolescent counter-normative behaviors increase voluntary and involuntary job exits in young adults. This prediction extends the social sorting view of employment outcomes to cover concealable background characteristics, which has implications for involuntary mobility after entering the job. MethodologyThe National...

A Behavioral Theory of the Firm (Cyert & March, 1963) laid a conceptual foundation for the application of the “Carnegie School” approach to studying and understanding organization- level behavior and outcomes. The book has exerted enormous influence across fields such as organization theory, business strategy, economics, and organizational sociolog...

Most studies of responses to change in competitive environments focus on competitor-specific adaptations. However, rivals are often acutely aware of one another, and this awareness should influence their competitive behavior. In this study, we focus on three market structures that affect competitive behavior: competitive parity, status disparity, a...

Behavioral strategies are a potentially promising microfoundation of management research. Strategies involving processes of momentum, feedback, inference, and anticipation are already being investigated by organizational scholars, and evidence is mounting for each one. They are interesting because they can be seen as expressions of the level of rat...

This paper is inspired by real-world phenomena that firms lose reputation based on imprecise information and take a long time to recover. To formalize them, we develop a new model of endogenously repeated Trust game with imperfect monitoring. In customer-efficient Markov equilibria, the dynamic path of customers at a firm exhibits the asymmetry of...

Bank panics attract scholarly interest because they reflect distrust of each bank that experiences a run as a result of diffusion of information whereby rumors about bank runs trigger additional runs elsewhere. However, the contagion of bank runs is highly selective for reasons that are unrelated to the financial strength of the individual banks. T...

The “behavioral theory of the firm” refers to a research tradition that follows the basic assumptions and interests of Richard M. Cyert and James G. March’s pioneering work, A Behavioral Theory of the Firm (Cyert and March 1963, cited under Classic Treatments). This work examines how organizations function when managers have bounded (not full) rati...

The mutual fund industry consists of heterogeneous managers and investors. Hence, traditional models of delegated portfolio management need to be extended to allow heterogeneity. We propose that this extension can be modeled as a dual matching-contracting problem of endogenously repeated trust games, and demonstrate that dual matching and contracti...

Research on organizational learning from performance feedback has produced findings on how organizational change is influenced by performance relative to aspiration levels, but has focused on short-term goal variables. In this article, we examine how short- and long-term goals are related to short- and long-term actions, respectively. We do so by p...

Conventional wisdom in organization theory holds that the environment imprints organizations at the time of their birth. We reverse the imagery and propose that early founding of a nonprofit organization in one domain imprints a community with a general institutional legacy of collective civic action. Consequently, the community is more likely to l...

The Behavioral Theory of the Firm has had an enormous influence on organizational theory, strategic management, and neighboring fields of socio-scientific inquiry. Its central concepts have become foundational to any theoretical and empirical work focussed on organizational phenomena. Unlike past reviews of this work, we start by focusing less on r...

Handbooks usually cover established perspectives extensively while giving less attention to young research streams. We provide a counterweight by reviewing some young research streams in competitive strategy that have recently grown rapidly. We discuss research on multiunit organizations and multimarket strategy, network competition, group competit...

Departing from prior work that demonstrates the stickiness and stability of alliance networks resulting from embeddedness, we extend matching theory to study firms’ withdrawal from alliances. Viewing alliance withdrawal as a result of firms’ pursuit of more promising alternative partners – outside options – rather than failures in collaboration, we...

We combine structural hole theory with performance feedback theory to identify determinants of partner selection in networks. Specifically, we examine how a brokerage position coupled with aspiration-performance gaps affects an organization's propensity to initiate ties to partners of different status. We find that organizations in brokerage positi...

Firms seek to imitate innovations that yield competitive advantage, but imitation can presage disappointment when the innovation value is below expectations. Empirical research has only rarely examined the diffusion of such disappointing innovations, and it is not known whether negative information from past adopters will halt the diffusion process...

Past research has given contradictory answers to the question of how strategic change is linked to firm size and performance. This paper resolves the contradictory predictions of performance feedback theory and threat rigidity theory by positing that small and large firms have distinct responses to performance because of differences in risk aversio...

We have read with interest Hart-Brinson’s critical comment. We are disappointed that his comment is almost exclusively concerned with our analysis of application filing and success rates, and that he only fleetingly mentions our analysis of the cultural impact of low-power FM radio stations. A major thrust of our article was to show that a cultural...

We combine structural hole theory with performance-feedback theory to identify determinants of partner selection in networks. Specifically, we examine how a brokerage position coupled with aspiration-performance gaps affect an organization’s propensity to initiate ties to partners of different status. We find that organizations in brokerage positio...

This paper investigates the effects of organizational form on problemistic search. We contrast how Indian firms affiliated to business groups and unaffiliated firms evaluate performance and react by adjusting their internal technology search and external market search. We propose that, compared with unaffiliated firms, business group firms are more...

Although research on organizational misconduct has a long history and a recent increase in popularity, important questions are still unexplored. We review and critique research on misconduct with an emphasis on organizational causes. In addition to reviewing some active areas of research, we also examine less‐trodden areas and make suggestions for...

Despite the wealth of research on the origins of institutions, little is known about how institutions and their underlying logics are extended following initial diffusion stage. We argue that institutional extension happens through multi-wave diffusion of related practices such that an organization’s adoption of practices from an institutional logi...

This paper theorizes about why discoveries of corporate deviance that damage the legitimacy of the responsible organization may also have consequences for other organizations. We propose that audiences generalize from deviance by one organization to others that are similar. The result is a withdrawal from transactions even from non-culpable organiz...

Although models of alliance network dynamics have focused primarily on alliance formation, this study advances research by investigating member withdrawal from alliances. We develop a model of cohesion and friction at the relationship, network, and market levels and propose cross-level cohesion and time-varying effects on member withdrawal, giving...

Research on the diffusion of technologies that give competitive advantage is needed to understand the role of technology in competition. Predictions on which firms first obtain useful technologies are made by cluster theory, which holds that the diffusion is geographically bounded, and network theory, which holds that adoption is more rapid in cent...

This study advances understanding of network dynamics by applying matching theory to the formation of interorganizational alliances. We introduce market complementary and resource compatibility as two critical matching criteria of alliance formation and argue that good matches increase firm performance. Using data from liner shipping, we found effe...

We examine how knowledge and experience affect both the mean and variance values of innovations from individuals and teams. We apply and extend theory on innovativeness and creativity to propose that holding multiple knowledge domains produces novel combinations that increase the variance of product performance; and that extensive experience produc...

The article discusses research on the dynamics of member withdrawal from business alliances. The study--which focused on the international shipping industry--examined alliance cohesion and friction in terms of social compatibility within the alliance and relationships at the network and market levels. The hypothesis is that risk of withdrawal incre...

This chapter addresses the question of how the institutional environment relates to organizational learning. Two areas of research on organizational change are distinguished: the concept of problemistic search and the concept of inter-organizational diffusion. Research on problemistic search examines conditions that give rise to organizational prob...