Is there a strategic organization in the behavioral theory of the firm? Looking back and looking forward

Abstract

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 predict, what mechanisms are preferable predictors, and what outcomes are of interest. Despite these divisions, the last few years have seen particularly rapid progress, turning the behavioral theory of the firm into one of multiple organization theory sources of strategy knowledge. It is time to reassess and consider the best future direction, and we propose a framework organized around how strategy is shaped by the (1) organizational structure, (2) organizational decision makers, (3) organizational history, and (4) organizational environment. This subdivision captures the decision-making units in the theory (1–2), the importance of experience (3), and the role of context (4). We outline fruitful research topics based on this framework.