ENVIRONMENTAL JOLTS AND INDUSTRY REVOLUTIONS: ORGANIZATIONAL RESPONSES TO DISCONTINUOUS CHANGE

TLDR

Organizational change literature contains diverse, contradictory characterizations that are clarified by classifying change as continuous or discontinuous at the organization or industry level, producing four types—adaptation, metamorphosis, evolution, and revolution—that shape adaptive responses, industry competition, and research methods. The study addresses a gap by focusing on discontinuous industry‑level changes, an area lacking theoretical and empirical attention. The authors develop a perspective on discontinuous industry change and apply it in a historical analysis of the hospital industry, using longitudinal field data to illustrate organizational responses to discontinuities.

Abstract

The organizational change literature contains diverse characterizations of change processes with contradictory implications for strategic mianagers. Many inconsistencies are resolved by classifying models of organizational change according to the primary mode of change (continuous or discontinuous) and the primary level at which change occurs (organization or industry) to yield four basic types of change: adaptation, metamorphosis, evolution, and revolution. These types influence organizations' adaptive responses, shape industries' competitive structures, and constrain researchers' methods of inquiry. This paper identifies a gap in the literature: theory and research focusing on discontinuous changes occurring at the industry level of analysis. A perspective on this type of change is developed, and applied in a historical analysis of the hospital induistry. Data from a longitudinal field study are used to illustrate various organizational responses to discontinuities.