A Study On The Formation Mechanism Of Organizational Inertia And Its Interaction Mechanism On Enterprise Performance

Now Chinese economy is undergoing transformation period, thus how to adjust industrial structure or upgrade on the basis of strengthening stability, coordination and sustainability and transform the pattern of economic growth is related to the economic development strategy of our country. For the practice of firm management, the pattern and thoughts of management,institutional system and business models, successful experiences under state-owned enterprises, have can not adapt to the market competition environment, even as the obstacles the enterprise growth and development. In the background of transformed enterprise management environment, the restructured state-owned enterprise and emerging private enterprises both should discard obsolete system and propel institution and institutional innovation and management innovation and technological innovation, improving market competitiveness has become and gaining long-term competitive advantage have been the essential task.Since the 1990s of twentieth century, business environment show no continuity. When technology or market demand mutated, successful experience of excellent enterprise turned into history burden and the reaction and organizational change lag to rapid changing environment and finally firm decay or was forced to withdraw from the market competition. Since China's reform and opening, recalling the enterprise development process, a large number of famous enterprises, such as the giant, QinChi, slender, deron, etc, disappeared in a very short period of time. The declining speed is amazing. Many enterprises have losed the competitive advantage because of the impact of climate change in the business sector, which is almost has become a universal law. What is the root of competitive advantage loss for enterprise competition? Professor Hill and Jones in their works in the strategy management identify that the organizational inertia is the underlying reason that firm cannot adapt to new environment.Organizational inertia is one research field of enterprise management and a frontier problem, but the research related to enterprise organization is still very limited. In this background, this doctoral dissertation tries to build a theoretical framework for organizational inertia and provide reference for business operation. The structural arrangement of the doctoral dissertation has eight chapters and the specific content is as follows:The first chapter is introduction of the whole content, mainly describing the research background, research objective and theoretical significance, research methods, the research framework and specific content, and displaying the innovative point and deficiencies.The second chapter is the part of literature review. Firstly, through literature review and theoretical tracing, the connotation of organizational inertia is defined and determinant factors of inertia level is discussed. On this basis, according to the static and dynamic aspects, the two basic forms of enterprise organizational inertia are inertia and momentum. In this chapter, the previous research of organizational inertia and the research status is summarized and problems to be studied further are pointed out.In third chapter, based on the analysis of the sources for organizational inertia and its representation at different level, the drivers for enterprise organizational inertia is studied thoroughly. Sources of organizational inertia are quite widespread, almost all organizational elements or behavior involved. About the drivers for formation process of organizational inertia, theoretical viewpoint of current research is still unified because on organizational inertia is not subdivided effectively.In this chapter, through analyzing the sources of organizational inertia at different level the root of the organizational inertia is explored. Specifically, this dissertation explains the sources of organizational inertia from both internal and external sides. Among them, the asset specificity, ability or knowledge reuse, norms and radiation of organizational culture, institutional structure design and routine, the principal-agent relationship is the source of internal organizational inertia.The regulatory and industry policies is the external sources of organizational inertia; Secondly, from.three aspects of enterprise strategy, organization operation and external relations this chapter inspects the manifestation of the organizational inertia and lay a foundation for further exploration of organizational inertia, finally, this dissertation attributes drivers of organizational inertia to three aspects:internal restrictions, external pressure and restrictions on selection of action plan.In the fourth chapter, the formation mechanism of organizational inertia is studied. For organizations elements or subsystem in different levels, its change speed is very obvious difference. By this standard, a class model of organizational inertia is constructed in this section. From the organizational culture and individual and group cognition, resources and organization structure, the formation mechanisms of organizational inertia are discussed. Firstly, the essence of cultural inertia is the unitary characteristics of core value. If the organization culture become the umbrella of obsolete value, members would not generate motivation to query the assumptions and reshape the belief systems of organization, then organization culture becomes the inertial force boycotting change; Secondly, the cognitive inertia is mental models with rigid management hypothesis during grow and development of the enterprise.Especially, the unvalued business strategy and outdated business value in changing market environment cannot transcend the fixed cognitive framework, ignoring the information about external changes. In organization, the behavior of innovation is not encouraged and the control and obedience is emphasized; Thirdly, the structural inertia refers to that organization often set rules, procedures and control system for pursuing efficiency. Organization members in handling routine affairs following the operation rules and repeated operation will form the inertia of standard operation and constraint organization adapting to environmental change; Fourthly, resources inertia refers to that the company will be locked when technology and product resources was invested, even if the changing market environment requests the enterprise thoroughly to alter the direction of cultivating core competence, the deploying pattern of enterprise resource may not change.In the fifth chapter, the two sides of organizational inertia effect is discussed. When the external environment is relative stable, organizational inertia can promote the efficiency of the enterprises and elevate enterprise operating performance. But if the external environment appears mutates, organizational inertia will boycott organizational change and reduce enterprise performance because organization can not adapt to the environment.In the sixth chapter, this section discusses that firm can use enhancement mechanisms in the stability condition and the weakening mechanisms in dynamic environment and the dual structural frame to coordinate organizational inertia. Coordinating organizational inertia need to use opportunity in the external environment that causes pressure. Organization will make fundamental transformation under the condition of crisis. Organization prefers stability and apt to incremental 1 change in order to guarantee efficiency by continuous improvement, but it can also cause dynamic organizational inertia—momentum. In organization design, feasible selection for coordinating organizational inertia is autonomous institutions, which can guarantee the enterprises adopt new technology and development in new business with no relation to the original technical, business strategy and cultural factors.In the seventh chapter, antecedents of organization inertia and its interaction mechanism on enterprise performance was explored. Mechanism model of organizational inertia is constructed based on the analysis of the analysis before using structural equation model and the model is validated. The results show that: the correlation between organizational inertia and enterprise performance is not a simple linear relationship. The dynamic change of environment plays a significant moderating role. This is also verified.In the eighth chapter, this part is main research results and the enlightenment. Some direction for future research is pointed out.The doctoral dissertation has four innovation points:1. Based on of existing research results, this paper builds up a relatively complete theoretical framework of organizational inertia. From the organization of the connotation, basic forms of inertia, formation mechanism and transcend mechanism, etc. Based on the comprehensive studies, a complete system of organizational inertia is formed.2. In this study, the firm behavior theory, organizational learning theory, path dependence theory is organically integrated together, forming a conceptual model of the system of organizational inertia. The study is to relax and expand theoretical assumptions of environmental determinism in structure inertia theory of Hannan and Freeman. The theoretical framework of the organizational inertia has stronger power of explanation.3. In this research, the different subsystem or elements of organization have different intensity of inertia and by this way a hierarchy model of organizational inertia is set up. From strong to the weak, the order is cultural inertia, cognitive inertia, resources inertia and structural inertia. This model can exhaustively explain the formation process of organizational inertia.4. The study on dual effect organizational inertia, from the strategy choice and the organizational change, how to coordinate organizational inertia is discussed. The study found that when the external environment is relatively stable state, firm may use the self-reinforcing mechanism of organizational inertia to strengthen the inertia, promoting the efficiency of enterprise operation.And in the mutating environment, enterprise need fundamental change to make organization and environment fit and consistent. In the system design, the enterprise can adopt ambidexter organization design, establish autonomous institutions to guarantee the firm developing existing activities under the premise of stable business operation and simultaneously searching for new business, new technology separating from the original operation strategy, technology and cultural factors.