Talking About Organizations Podcast 25: Competitive Groups as Cognitive Communities (Part 1)
Feb 28, 2017
In this engaging discussion, Professor Sarah Kaplan of the Rotman School of Management shares her insights on the influential paper about Scottish knitwear manufacturers and their cognitive communities. She explores how managers’ mental models shape perceptions of competitors, leading to differences in viewpoints with external analysts. Kaplan also highlights the role of local networks in reinforcing shared cognitive boundaries and discusses how technology impacts these dynamics. This conversation reveals the intricate connections between cognition, strategy, and market definitions.
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Interpretation Shapes Strategy
- The Scottish knitwear paper reframed strategy by showing managers' interpretations shape perceived environments.
- It shifted focus from objective matching to interpretive processes that create strategic choices.
Shared Networks Create Shared Frames
- Managers in the Scottish knitwear industry shared highly aligned views of competitors due to dense local networks.
- These shared information filters self-reinforced cognitive groups over time.
Manhattan Hotels Example
- Joel Baum and Teresa Lant found Manhattan hotel managers listed different competitors than external analysts.
- Their field interviews revealed practical perceptions that diverged from analytic definitions.
