Adaptive responses by conservative and entrepreneurial firms

Over time, most corporate managements face the necessity of adapting their organizations to new environments. The style of such adaptation depends both on the original strategy of the company and its new objectives and environment. Necmi Karagozoglu and Warren Brown report the results of research which explores the changes in the organization's rate of innovation in response to environmental shifts. The changes in the innovative behavior of conservative firms (which emphasize stability, standardized products and cost-minimization strategies) are contrasted with that of entrepreneurial firms (which emphasize flexibility, rapid product change and state-of-the-art product features). Organizational competence and management's willingness to change are some of the key independent variables used in the project. The data are from a study of 56 manufacturing companies representing 26 industries.