Organizational Identity and Strategy: An Empirical Study of Organizational Identity's Influence on the Strategy-Making Process

Abstract

Continuous change is important for organizations' survival in a changing world, and the need for stability and continuity in the form of a clear and strong corporate identity is also acknowledged to be critical for organizational success. Organizations thus face a dilemma when they engage in strategy-making—namely, how to reconcile the perpetual tension between continuity and change. Provided in this paper are empirical insights from a longitudinal study of strategy-making that addresses this critical issue. Taking the perspective of the participants, the findings explain how their organizational cognition influenced their strategy-making action and show how a strong organizational identity guided their behavior and made it difficult for them to adapt to organizational change.