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Complex adaptive system mechanisms, adaptive management practices, and firm product innovativeness Ali E. Akgün 1 , Halit Keskin 2 , John C. Byrne 3 and Özgün Ö. Ilhan 4 1 Science and Technology Studies, Gebze Institute of Technology, Gebze- Kocaeli, Turkey. [email protected]; [email protected] 2 Science and Technology Studies, Gebze Institute of Technology, Gebze- Kocaeli, Turkey. [email protected] 3 Lubin School of Management, Pace University, New York, New York, USA. [email protected] 4 Science and Technology Studies, Gebze Institute of Technology, Gebze- Kocaeli, Turkey. [email protected] As a fascinating concept, the mechanisms of complex adaptive system (CAS) attracted many researchers from a variety of disciplines. Nevertheless, how the mechanism-related vari- ables, such as strategic resonance, accreting nodes, pattern forming, and catalytic behavior of organization, impact the firm product innovativeness is rarely addressed empirically in the new product development (NPD) literature. Also, there exist limited studies on the antecedents of the mechanisms of CAS in the NPD literature. In this respect, we identified and operationalized the adaptive management practices, which involve bonding, nonlinear, and attractor behaviors of management, as antecedents of mechanisms and firm product innovativeness. By studying 235 firms, we found that (1) strategic resonance and accreting nodes are positively related to firm product innovativeness, (2) bonding, nonlinear, and attractor behaviors of management positively influence the mechanism variables, and (3) market and technology turbulence impact the adaptive management practices. We also found that mechanisms of CAS partially mediate the relationship between adaptive man- agement practices and firm product innovativeness. 1. Introduction C hanging trends in technology and customer needs in turbulent and unpredictable environ- ments require firms to become more aware of their adaptability for sustainable competitive advantage in general, and the development of successful new products, product innovativeness, in particular (Hansen and Serin, 1993). In this sense, scholars emphasize the importance of complex adaptive systems (CAS) view, which in general indicates a system that emerges over time into a coherent form, and adapts and organizes itself without any singular entity deliberately managing or controlling it (Holland, 1995; Buckley, 2008), to gain insights for successful product development efforts under the 18 © 2013 RADMA and John Wiley & Sons Ltd
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Complex adaptive system mechanisms, adaptive management practices, and firm product innovativeness

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As a fascinating concept, the mechanisms of complex adaptive system (CAS) attracted many researchers from a variety of disciplines. Nevertheless, how the mechanism-related variables, such as strategic resonance, accreting nodes, pattern forming, and catalytic behavior of organization, impact the firm product innovativeness is rarely addressed empirically in the new product development (NPD) literature. Also, there exist limited studies on the antecedents of the mechanisms of CAS in the NPD literature. In this respect, we identified and operationalized the adaptive management practices, which involve bonding, nonlinear, and attractor behaviors of management, as antecedents of mechanisms and firm product innovativeness. By studying 235 firms, we found that (1) strategic resonance and accreting nodes are positively related to firm product innovativeness, (2) bonding, nonlinear, and attractor behaviors of management positively influence the mechanism variables, and (3) market and technology turbulence impact the adaptive management practices. We also found that mechanisms of CAS partially mediate the relationship between adaptive management practices and firm product innovativeness.
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Page 1: Complex adaptive system mechanisms, adaptive management practices, and firm product innovativeness

Complex adaptive systemmechanisms, adaptivemanagement practices, andfirm product innovativeness

Ali E. Akgün1, Halit Keskin2, John C. Byrne3 andÖzgün Ö. Ilhan4

1Science and Technology Studies, Gebze Institute of Technology, Gebze- Kocaeli, [email protected]; [email protected] and Technology Studies, Gebze Institute of Technology, Gebze- Kocaeli, [email protected] School of Management, Pace University, New York, New York, USA. [email protected] and Technology Studies, Gebze Institute of Technology, Gebze- Kocaeli, [email protected]

As a fascinating concept, the mechanisms of complex adaptive system (CAS) attracted manyresearchers from a variety of disciplines. Nevertheless, how the mechanism-related vari-ables, such as strategic resonance, accreting nodes, pattern forming, and catalytic behaviorof organization, impact the firm product innovativeness is rarely addressed empirically inthe new product development (NPD) literature. Also, there exist limited studies on theantecedents of the mechanisms of CAS in the NPD literature. In this respect, we identifiedand operationalized the adaptive management practices, which involve bonding, nonlinear,and attractor behaviors of management, as antecedents of mechanisms and firm productinnovativeness. By studying 235 firms, we found that (1) strategic resonance and accretingnodes are positively related to firm product innovativeness, (2) bonding, nonlinear, andattractor behaviors of management positively influence the mechanism variables, and (3)market and technology turbulence impact the adaptive management practices. We alsofound that mechanisms of CAS partially mediate the relationship between adaptive man-agement practices and firm product innovativeness.

1. Introduction

Changing trends in technology and customerneeds in turbulent and unpredictable environ-

ments require firms to become more aware of theiradaptability for sustainable competitive advantagein general, and the development of successful newproducts, product innovativeness, in particular

(Hansen and Serin, 1993). In this sense, scholarsemphasize the importance of complex adaptivesystems (CAS) view, which in general indicates asystem that emerges over time into a coherent form,and adapts and organizes itself without any singularentity deliberately managing or controlling it(Holland, 1995; Buckley, 2008), to gain insights forsuccessful product development efforts under the

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turbulent environmental conditions in the newproduct development (NPD) literature (Brownand Eisenhardt, 1998; McCarthy et al., 2006). Forinstance, McCarthy et al. (2006, p. 439) wrote that‘[a] CAS framework views individual NPD processesas adaptable or malleable systems capable of produc-ing a range of behaviors to suit different innovationexpectations, levels of market uncertainty, and ratesof change’. Nevertheless, studies on the CAS in theNPD context are limited, and most of them are theo-retical arguments on how the CAS view is generallyapplied to product development process or stages(e.g., Cunha and Comes, 2003; Chiva-Gomez, 2004;McCarthy et al., 2006). While these studies showhow a CAS works in product development efforts inprojects or organizations, we need a greater under-standing of the enabling conditions and the mecha-nisms of CAS in particular to adequately examine orexploit the viewpoints of its theory. The mechanismsof CAS in general indicate the dynamic behaviorsthat produce complex outcomes, such as innovation,as found in the management literature (Uhl-Bienand Marion, 2009). The mechanisms of CAS enablepeople, groups, or departments in the organization tomove beyond thinking about individualistic efforts(Harkema, 2003; Buffington and McCubbrey, 2011),and offer them a way to generate an understanding ofthe dynamic practices and processes to implementadaptiveness during product development activities(Garud et al., 2011). However, given the importanceof mechanisms of CAS, interestingly, little attentionwas given to the operationalization and the empiricalimplications or validation of these mechanism-related variables on the success of new products inthe NPD context. In this respect, Pathak et al. (2007,p. 564) also wrote:

A model of CAS behavior should preciselystate how to measure the relevant constructs,how the constructs are related, and how certainmechanisms affect those constructs. Onlywhen these issues are clearly stated can thetheory be validated and examined for consist-ency with the phenomena under study across awide range of situations.

Also, from a managerial point of view, a study on theantecedents or drivers of the mechanisms is missing– which warrants an empirical analysis, in addition tothe consequence of mechanisms on firm productinnovativeness.

To solve the above issues, we primarily adapt theCAS model of Uhl-Bien et al. (2007), which pro-vides a theoretical framework for mechanism ofCAS. It should also be noted that while the CAS

model of these authors is argued in the leadershipcontext (i.e., at the individual level), it is highlyabstract, implicit, and not operationalized. We lever-age their views to an organizational level and in theproduct innovation context. Here, mechanisms ofCAS are the dynamic behaviors, processes, and prac-tices that occur within the product developmentefforts to leverage the firm innovativeness. Themechanisms of CAS include resonance (i.e., agentsacting in concert), accreting nodes (i.e., the collec-tion of many small ideas and inputs that rapidlyexpand in importance), pattern formation (i.e., adap-tive and dynamic interpretations of events and situa-tions), and catalytic behaviors (i.e., behaviors thatspeed up or enable certain activities) (Uhl-Bienet al., 2007). For antecedents of the CAS mecha-nisms, based on the complexity leadership (CL)theory of Uhl-Bien and Marion (2009), we use the‘adaptive management’ practices. The rational isthat an adaptive management perspective does notrestrict management with hierarchical positions orroles; instead, it views management as a key elementof the organizing process in adaptive efforts through-out the organization, such that adaptive managementcan be viewed as a social influence practice andbehavior of management through which emergentcoordination (i.e., evolving social order) and change(e.g., new values, attitudes, approaches, behaviors,and ideologies) are constructed and produced tocope with turbulent conditions in the CL perspective(Brown and Eisenhardt, 1998; Uhl-Bien et al.,2007). Based on the theoretical study of Uhl-Bienand Marion (2009), we operationalize adaptive man-agement as practices involving bonding behavior(i.e., creating dynamic linkages and interactions),nonlinear behavior (e.g., derived by an asymmetri-cal, dynamic, and chaotic attitude), and attractorbehavior (i.e., acting as tags and creating attractors)of management.

Therefore, the aim of this study is to operationalizeand empirically test the impact of mechanisms ofCAS and adaptive management practices on firmproduct innovativeness to further enhance theliterature on organizational innovation and com-plexity science. Also, this study attempts to improvethe precision of CAS and CL theories throughexpanding and refining their existing theoreticalconceptualizations in the innovation context.Specifically, as shown in Figure 1, this study in-vestigates (1) the role of mechanism variables onfirm product innovativeness, (2) the impact of theadaptive management practices on the mechanismvariables, (3) the mediator role of mechanismsof CAS between adaptive management practicesand firm product innovativeness, and (4) the

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triggering/enhancer role of environmental turbulence(including market and technology turbulence) onthe adaptive management practices and mechanismvariables.

2. Mechanisms of CAS and adaptivemanagement practices

The mechanisms of CAS show the necessary condi-tions under which complex and dynamic behaviorwill occur in organizations, and include resonance,accreting nodes, pattern formation, and catalyticbehavior (Uhl-Bien et al., 2007). Resonance, follow-ing CAS researchers, for example, Uhl-Bien et al.(2007, p. 308), is defined as ‘acting in concert . . .more specifically to situations in which the behaviorsof two or more agents are interdependent’. In theinnovation management literature, a similar defini-tion of resonance can be found in the study of Brownand Fai (2006), addressing the automobile and com-puting industries, and is labeled as ‘strategic reso-nance’. Here, we believe that the well-establishedconcept of ‘strategic resonance’ can be applied to theproduct innovation efforts in the organization and canilluminate the abstract definition of resonance in theCAS literature. Brown and Fai (2006), for instance,mention that strategic resonance is a dynamic,organic, ongoing, and strategic process that is aboutensuring continuous linkages and harmonizationbetween the market and the firm’s operation capabil-ities, firm’s strategy and its operations capabilities,and within all functions and all levels within the firm.

Another mechanism variable is the accretingnodes. Accreting nodes indicate the notion of ideasthat rapidly expand in importance and which accrete

related ideas (Uhl-Bien et al., 2007, p. 308).Pavlovich (2009) expands that notion of accretingnodes based on the unfoldment/enfoldment principleof information or knowledge, and mentions thataccreting nodes indicate the self-organization andreciprocal creation of ideas, information, and knowl-edge. Here, the idea is that information/knowledgeis developed and self-regulated through a proceduralmemory and transactive memory system (Boal andSchultz, 2007). No matter how much information/knowledge is developed, core information/know-ledge is inherent in each, despite an ongoing flowand change of components (Pavlovich, 2009). Withinthis process, new information/knowledge evolvethrough complex, flexible, and nonlinear modes ofself-organization in an organizational and learningcontext as can be seen in the fuzzy front end orconcept development stages of the product develop-ment process (Reid and de Brentani, 2004). Scholars(e.g., Cacioppe and Edwards, 2005; Boal andSchultz, 2007; Pavlovich, 2009) note that accretingnodes are manifested in organizations through howan idea or information/knowledge (1) is magnifiediteratively or successively, as in a recurring growthpattern, (2) proceeds through self-consistency andfancy complementary beliefs, and (3) reweavesthrough the web of organizational metaphors, stories,symbols, and rhymes.

Pattern formation is another mechanism of CAS.It illustrates the process of crystallizing ideas, andmaking sense of events, information, and complexsituations in the organization and its environment,to enhance the explanatory and/or design capabilityof people (Kurtz and Snowden, 2003). It is obviousthat this definition of pattern formation is broadand overlaps with the definition of ‘organizational

Adaptive management practices• Bonding behavior• Nonlinear behavior• Attractor behavior

Mechanisms of CAS• Strategic resonance • Accreting nodes• Pattern formation• Catalytic behavior

Firm product innovativeness

Control variables• Size• Age • Industry

H1-H4

H5-H7

H8 (mediator)

Env. turbulence• Market• Technology

H9

H10

Figure 1. Proposed model. CAS, complex adaptive system.

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sensemaking’ (Weick, 1995). In this regard, weadapted the concept of ‘patterning of attention’ fromHunt et al. (2009) and Osborn et al. (2002) to clarifyand better operationalize the concept of pattern for-mation for the CAS view of product innovation. Thepatterning of attention, as a sensemaking mechanism,indicates the collective process whereby people iden-tify what is important and relevant in moving towarddesired ends (Osborn et al., 2002). Especially, Huntet al. (2009, p. 514) wrote that:

From a traditional viewpoint, patterning ofattention . . . stimulates social construction tocreate new information and knowledge fromthe dialog and discussion of all participants.From a complexity perspective, these influenceattempts may alter N, K, P and C. That is, newindividuals within the system may be included(a change of N), new combinations of interac-tion may be fostered (a change in K), newschema may emerge (a change in P), and newconnections with those traditionally outside thesystem may be made (a change in C).

Based on this view, we believe that it is the process ofselecting what is important for product developmentprocess, and how this is to be achieved in the organi-zation is a critical aspect of firm strategy and productdevelopment efforts in the CAS perspective. Patternformation or patterning of attention can be seen inthe organization when people (1) build a coherentstructure or a description of a successful solutionto product-related problems; (2) emphasize self-adjustment and development of the firm strategy toaddress the concurrent environmental turbulence,and expand the notion of influence patterns, such aspatterning which revolve around the issues of effi-ciency, quality, innovation, and profitability, etc.; and(3) seek understanding of the situation via dialogue,storytelling, and discussions, and use different view-points to make their ideas/information prolific andvibrant (Hunt et al., 2009).

The last mechanism variable is the catalyticbehavior. Catalytic behavior shows the ability ofaccelerating and enabling activities by the addition ofcatalysts in the organization (Marion and Uhl-Bien,2001; Morse, 2010). Catalysts are parts of the socialinteraction system that enable adaptive actions, suchas seeing the bigger picture, understanding interrela-tionships, and bridging the communication gapamong people or functional units (Holland, 1995;Uhl-Bien et al., 2007). From the CAS perspective,catalysts are also considered as internal and externalnew information or knowledge that prompt firms torecognize new options, reevaluate existing options,

or revisit previously discarded options (Morris,2005). Further, catalysts in an organization arepeople, ideas, dreams, new technologies, symbols,group myths, or beliefs, which provide filtering aswell as cooperation and speeding up of events andactions (Morse, 2010).

In addition to the mechanisms of CAS, we alsodiscuss the term of adaptive management. Adaptivemanagement from the CL perspective is a socialinfluence practice that occurs within an organizationin order to provide sufficient structure and enablemanagerial behavior in favor of firm adaptability andinnovation (Marion and Uhl-Bien, 2001; Uhl-Bienet al., 2007; Uhl-Bien and Marion, 2009). Based onthe CL theory, adaptive management involves prac-tices of bonding, nonlinear, and attractor behaviors ofmanagement (Uhl-Bien and Marion, 2009). Bondingbehavior, a function of the network dynamics ofCAS theory, is the ‘linking up’ practice throughwhich social networks and network structures formand evolve (Uhl-Bien and Marion, 2009). As Barczaket al. (1987) mention, bonding behavior formsknowledge worker communities, cultivates greatersense of community, trust, respect, and shared vision,and leverages knowledge transfer and generation.From an operationalization perspective, a bondingbehavior of management is manifested by to whatextent management (1) fosters the development ofmoderately coupled structures in which ideas canemerge freely and match, (2) encourages informationflows by building personal networks of inter-connectivity and linkages, (3) injects ideas and infor-mation into the system for its members to ponder andprocess, and (4) embraces diversity indicating itslevel of comfort with divergent or conflicting ideas(Uhl-Bien and Marion, 2009).

Nonlinear behavior is another adaptive manage-ment practice. In the CL context, nonlinearity indi-cates the asymmetrical relationships embodied in theorganization, feedback loops among the people, aswell as recurrency, which means that any activity ofpeople can feed back onto itself (Uhl-Bien andMarion, 2009). We believe that nonlinear behaviordemonstrates the dynamic and sometimes chaoticattitude of the management in the organization. Thisis such that management maintains the organizationat the edge of chaos, seeks to spawn emergent behav-ior and creative surprises rather than to specify andcontrol organizational activities, and creates organ-ized disorder in which dynamic events happen atmultiple locales within the organization (Uhl-Bienand Marion, 2009). Nonlinear behavior of manage-ment also incorporates the idea that time and historymatter, such that the past is co-responsible for thepresent behavior as well as the future (Osborn et al.,

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2002; Boal and Schultz, 2007; Mischen and Jackson,2008). In this way, management connects the past,present, and projects the future through storytelling(Boal and Schultz, 2007; Uhl-Bien et al., 2007).

The last adaptive management practice is attractorbehavior. Attractor behavior of management fromthe CL perspective is related to the use of attractorsto enhance adaptiveness in the organization. It shouldbe noted here that attractors come in different‘flavors’ in the complexity theory, such as point, peri-odical, and strange attractors (Kauffman, 1993;Merali, 2006). Consistent with the scholars in theCAS literature (e.g., Osborn et al., 2002; Boal andSchultz, 2007), we focus on the strange attractors inthis study. Strange attractors describe a system thatfunctions in complex but inherently unpredictableways, but that concurrently self-organizes into emer-gent order and structure (Pryor and Bright, 2007). Inthis way, the possibilities of evolution, adaptability,and change are associated with strange attractors(Boal and Schultz, 2007). In the management litera-ture, strange attractors define the boundaries withinwhich system behavior can occur and are analogousto the culture and climate of an organization (Coxet al., 2009). In a sense, a strange attractor is definedas a trajectory of behaviors (although the exact pathis unknown) that draws people into it and influencestheir behaviors in the organization (Osborn et al.,2002; Uhl-Bien and Marion, 2009). For example,values, fads, identity, vision and mission, socialassumptions, relationships, and structures function asattractors in an organization (Barczak et al., 1987;Pryor and Bright, 2007). Here, using attractor behav-ior, management becomes aware of the potential ofsuch dynamic behavior, and works to repeat and/orenhance attractors’ potentials. Recognition of theeffects of such attractors may be seen and act as tags(e.g., a flag or symbol around which everyone rallies)(Boal and Schultz, 2007; Uhl-Bien and Marion,2009).

3. Hypothesis development

3.1. Mechanisms of CAS and firmproduct innovativeness

We argue that strategic resonance leverages productdevelopment efforts by amplifying the meaning ofthe information, and leads to an increase in itscontent and receptivity. For example, Mann (2002,p. 88) notes that ‘resonance is a potent force levercapable of amplifying small inputs into largeoutputs’. In particular, people can develop new con-cepts and information through exposure to diverse

and opposing views, ideas, and capabilities, and vali-date the re-creation of new information, knowledge,and capabilities with strategic resonance (Bennet andBennet, 2008). Strategic resonance also provides‘mutuality’ in the organization to improve productdevelopment efforts. As the people or departmentsperforming different functions interact, they bothgive and receive resources (e.g., ideas, information,capability, etc.) during the product developmentprocess; continuous linkages and harmonizationamong their actions, capabilities, resources, etc. arecreated so that they are able to adapt to the challengesthey face individually together in a mutually benefi-cial manner. In a sense, people or departments worktogether, albeit with their potentially conflictingviews, capabilities, and competition for the sameresources (Brown and Fai, 2006), synchronize theiremotions and enhance their collective energy(Humphrey et al., 2008), and develop an appreciationof each other’s knowledge/capability limitations andresponsibilities (Taylor et al., 2002) through strategicresonance. Strategic resonance further helps peopleor departments take different functional approachessimultaneously – leveraging product developmentefforts (Brown and Fai, 2006). For instance, reso-nance among departments or functional unitsprovides a dynamic view of technology and market-related information, and helps them see taken-for-granted events in a new light, based on the perceivedsimilarities with their domains (Turner, 2007). Inaddition to viewing events in a new light, peoplerecognize that information/knowledge regarding thetechnical or marketing aspect of the tasks may belocated anywhere in the organization (Burns andStalker, 1994). Therefore, we hypothesize that:

H1: Strategic resonance is positively related to firmproduct innovativeness.

Accreting nodes (e.g., expanding information orknowledge iteratively) impact product innovative-ness by effectively gathering information or knowl-edge in the organization. For instance, throughaccreting nodes, project-related new informationor knowledge develops within the interrelationsamong people/functions, and it is then structured ina manner that allows people to achieve multiplecourses of action during the product developmentprocess (Hawes, 1999). This is such that peopledevelop new perceptions, views (i.e., mentalmodels), and knowledge bases to respondunpredicted changes about projects, its environment,and organization in a flexible manner (Tharumarajahet al., 1996). Accreting nodes also enhance the cross-functional integration and collaboration, improvingproduct innovation efforts. For example, when

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product-related new information is disseminated ver-bally throughout the organization, new engagementsamong people may be realized. This is becausepeople create recursive relations and interactions forproduct-related information expansion and dissemi-nation (Hawes, 1999). Also, social interactionsamong people reproduce, mediate, and transforminformation, and create cohesion where people aresimultaneously autonomous and cooperative forinformation expansion (Pavlovich, 2009). This way,people better understand the whole product develop-ment process and discover product-related problemsmore effectively in order to improve its success in themarketplace. Therefore:

H2: Accreting nodes are positively related to firmproduct innovativeness.

We put forward that pattern formation (i.e., pat-terning of attention) enhances product developmentefforts by improving the problem-solving abilities ofpeople. For example, pattern forming makes product-related problems and issues more visible to morereadily allow people to take the needed actions, andaids people against ill-prepared product-related prob-lems (Kurtz and Snowden, 2003). Pattern formationalso helps people see the product developmentprocess in a holistic way, thereby enhancing thesuccess of the new product. Specifically, pattern for-mation provides opportunities for people to shape,form, expand, and adjust their understandingsabout product-related concepts, objects, and events,thereby placing and seeing them in a larger NPDcontext and making sense of the ‘whole’ innovationprocess (Eoyang, 2007). Additionally, pattern forma-tion reduces the tension inflicted upon product devel-opment efforts. For instance, when the task-relatedconflict evolves during the product developmentproject, the pattern formation channels the mentaland behavioral experiences of people to a narrowrange of behavior, and reduces the number of project-related parameters, forming a logically coherentproduct development process (Cindea, 2006). There-fore, we hypothesize that:

H3: Pattern formation is positively related to firmproduct innovativeness.

Catalytic behavior of an organization also influ-ences the product development activities by seedingpositive feedback, creativity, and entrepreneurialactivities. This is such that creating an environmentwhere feedback, creativity, and entrepreneurship areexpected and approved energize the innovativebehavior. Indeed, as Latour (1992) noted, ideas need‘energy’ to diffuse throughout the organization, and

that people, whether users or creators of the idea,must transform their idea into actions. Here, forinstance, a lack of sufficient support (e.g., product oridea champion) during all the phases of innovativeactivities can cause new ideas and models to be aban-doned (Hannah and Lester, 2009). Catalytic behaviorof an organization also improves the collective learn-ing efforts during the product development efforts.Specifically, people learn to supportively reason in adirection to formulate inferences that lead to theenvisioned product-related solutions and outcomes(Latta and Kim, 2010), foster collective discussionsand communication flow about how meaningfullearning could take place due to limited time andresources (Hannah and Lester, 2009), and unlearn oreliminate previous information or knowledge tocreate new knowledge for better product develop-ment endeavors. Therefore:

H4: Catalytic behavior is positively related to firmproduct innovativeness.

3.2. Mechanisms of CAS and adaptivemanagement practices

We posit that adaptive management practices influ-ence the mechanisms of CAS. For instance,bonding behavior of management leverages themechanism variables, for example, strategic reso-nance, by helping people act in a unified and inter-dependent manner (Barczak et al., 1987; Brett,1996). Consequently, people (1) share their work-loads with each other, and help each other in theirtasks, (2) develop mutual personal friendship andempathy, as well as a high team spirit, and (3) tendto make better decisions than any single individualor department would make in a given situation(Haque, 2004). Indeed, bonding behavior of man-agement does limit functional autonomy in formu-lating its working rules since people’s judgmentsare constrained by bounded rationality. Also,bonding behavior of management fosters social ties,and thereby speeds up the socialization process,enhancing catalytic behaviors and accreting nodes(Peppard, 2007). For example, people exploit infor-mation or knowledge through direct exchange withtheir colleagues by tapping each other’s networks.In this way, people also recognize each other’svalues and routines, and appreciate each other’sabstract and tacit know-hows (Peppard, 2007).Further, bonding behavior of management enhancescommitment among people to improve the effec-tiveness of pattern formation, such that peopledevelop a mind-set that identifies them to theirobjects and courses of action (Torka et al., 2005).

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As people have varied interests, abilities, and per-sonal commitments, their identification, association,and commitment are also likely to vary. In thisrespect, bonding behavior of management providesthe ability for people/departments/groups to carryout their strategic direction successfully and tomaintain their means to implement. Therefore:

H5: Bonding behavior of management is positivelyrelated to the development of mechanisms of CAS.

Nonlinear behavior of management also influencesthe mechanisms of CAS (e.g., strategic resonance)by leveraging reciprocal, mutually causal, and inter-weaving influences among people and events(Mendenhall et al., 2000). For example, a reciprocalinfluence is the process through which each percep-tion is concomitantly the outcome of the precedingaction, and is the condition for the following actioncreating personal knowledge (Champagne et al.,2007). In this way, nonlinear behavior of themanagement creates a synergistic mind-set in theorganization. Nonlinear behavior of managementalso offers a multiplier and recycling effect ofinformation/knowledge generation, enhancing themechanisms of CAS (Holland, 1995). For instance, amultiplier effect occurs when knowledge pass frompeople to other people, and possibly (likely) beingtransformed along the way, producing a chain ofchanges (Holland, 1995). Here, knowledge is recy-cled effectively, taking potentially new forms, withknowledge sharing supported with a diverse set ofknowledge flows and a possibility for creating ad hocknowledge flows. Finally, due to its historical per-spective (e.g., connecting past, present, and projectedfuture of the firm), nonlinear behavior of manage-ment helps people see the dynamic nature of workand business-related experiences of the firm, andoffers an opportunity for them to frame experiencein a way that opens up behavioral risk taking andexpands the potential for creativity (Bussolari andGoodell, 2009). Therefore, we hypothesize that:

H6: Nonlinear behavior of management is positivelyrelated to the development of mechanisms of CAS.

We argue that attractor behavior of managementleverages the mechanisms of CAS by providingpeople with visual images of the organization andenvironment (Boal and Schultz, 2007). For example,a compelling corporate vision represents an assertionthat the adaptive efforts take their meaning from thewhole firm and cannot be understood in isolation(Barczak et al., 1987). In this way, the managementstabilizes divergent thoughts, feelings, and actionswithin and between them to enhance strategic reso-nance and knowledge expansion or accreting nodes

(Coleman et al., 2007). Attractor behavior of man-agement also influences the mechanisms by acting asa tag (i.e., a flag or symbol around which everyonerallies and the philosophy that binds people together)(Marion and Uhl-Bien, 2001), such that manage-ment, as a tag, serves as a form of reference and asignal with which behavior can be compared, andmutual adjustment can occur, coordinates the activ-ities of different people or departments, channelsknowledge flows throughout the organization,promote and articulate an idea and an attitude, andprovides organizations a long-term behavior or anidentity for adaptiveness (Waldrop, 1992; Holland,1995; Boal and Schultz, 2007; Pryor and Bright,2007). Therefore:

H7: Attractor behavior of management is positivelyrelated to the development of mechanisms of CAS.

3.3. Mechanisms of CAS, adaptivemanagement practices, andproduct innovativeness

We argue that as a driver of CAS mechanisms, adap-tive management practices also influence the firmproduct innovativeness. For example, as a componentof adaptive management practices, attractor behaviorcultivates an innovative climate and orientation byenabling the encouragement of individual initiativesand clarifying the individual responsibilities (Uhl-Bien et al., 2007; Carmeli et al., 2010). In this regard,people are able to solve product-related problemseffectively, and enhance the capacity to respond tech-nological and market-related changes. Nonlinearbehavior also generates creative and adaptive knowl-edge that can impact product innovativeness. Here,people in the organization recognize the meaning ofa given exchange, and adjust their own behavior asthey respond to that meaning within the organization(Friedrich et al., 2009). That is, when people adjustthemselves according to the new information, theyexpand their own behavioral repertoire, which ineffect broadens the behavioral repertoire of theorganization itself (Kauffman, 1993). Further, bond-ing behavior influences firm product innovationefforts by fostering interactions within and betweensocial networks in such a way as to create and diffuseinformation across the organization. As people fromdifferent departments frame product-related issuesaccording to their perspectives, the adaptive manage-ment practice of bonding behavior forms an organiz-ing network to build their coalition and ally theircomplementary interests as well as resources(Hargrave and Van de Ven, 2006).

We should also note that CAS mechanisms influ-ence firm product innovativeness. In this respect, we

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argue that these mechanisms mediate the adaptivemanagement practices–product innovativeness link,which we empirically know little about so far. Spe-cifically, the mechanisms allow adaptive manage-ment practices to function effectively for enhancedproduct innovation efforts, and actualize those prac-tices and atmosphere into product innovation efforts.Therefore, we hypothesize that:

H8: The mechanisms of CAS mediate the relation-ship between adaptive management practices andfirm product innovativeness.

3.4. Environmental turbulence, adaptivemanagement practices, andmechanisms of CAS

We put forward that environmental turbulence has atriggering role on the adaptive management prac-tices and CAS mechanisms in organizations. Spe-cifically, the management literature indicates thatenvironmental turbulence provides little reliableinformation, leading to ‘causal-ambiguity’ (Cellyand Frazier, 1996). In this sense, when the externalenvironment becomes more turbulent, and thus lesspredictable, organizations adjust their practices,processes, and routines to meet the challenges byaligning management practices and mechanisms(Beckman et al., 2004). For example, increasingchanges in the market and technology-related infor-mation or knowledge (1) requires firms to acquirenew information and then distribute it into organi-zation quickly (Sawy and Majchrzak, 2004), (2)entails an effective information sharing using storiesand feedback mechanisms, pattern forming, andsensemaking (Dougherty et al., 2000), and (3)increases the need of bonding and attractor behavior(Perrott, 2008). Also, quickly changing markets andtechnologies require quick responses and fast deci-sive actions for firms to take advantage of the exter-nal opportunities. Especially, catalytic behavior andstrategic resonance of organization, for example,can facilitate a sense of agility, real-time, multidis-ciplinary analysis and prompt people to work moreclosely together in an attempt to buffer the unpre-dictability (Majchrzak et al., 2000). Therefore, wehypothesize that:

H9: Environmental turbulence (i.e., market and tech-nology turbulence) influences the adaptive manage-ment practices.

H10: Environmental turbulence (i.e., market andtechnology turbulence) influences the mechanisms ofCAS.

4. Research method

4.1. Measures and sampling

To test the above hypotheses, multi-item scales eitheradopted or developed from prior studies for themeasurement of the variables were used. All vari-ables were measured using 5-point Likert scalesranging from ‘strongly disagree’ (1) to ‘stronglyagree’ (5). Appendix A contains the questionnaire. Abrief summary of the measures is presented in thefollowing section.

For strategic resonance in the organization, wedeveloped new question items based on the past theo-retical study of Brown and Fai (2006). We asked 14question items indicating to what extent there are (1)continuous linkage and harmonization among peopleand departments, (2) people act in concert, and (3)there is cohesion and alignment between the firm’scapability and the market segment and technology.Regarding the pattern formation variable, we devel-oped nine new question items, modified from thetheoretical arguments of Osborn et al. (2002). Thequestions were designed to determine (1) to whatextent people seek understanding of the situation viadialogue and discussion, (2) isolate and communi-cate which information is important, and (3) developinterpretive system to collectively pattern the situa-tions. We used the theoretical study of Hannah andLester (2009), Morse (2010), Uhl-Bien et al. (2007),and Marion and Uhl-Bien (2001) to operationalizethe catalytic behavior variable. We modified andasked 11 question items to address the organizationalview, including (1) to what extent people bridge com-munication gaps, (2) eliminate old knowledge, (3)facilitate continuous participation, and (4) construesocial behavior in a multidimensional way for speed-ing up or enabling certain activities in the organiza-tion. For accreting nodes, we developed six newquestion items based on the arguments of Cacioppeand Edwards (2005) and Pavlovich (2009), includingto what extent ideas and information/knowledge aremagnified iteratively and disseminated throughoutthe organization.

We asked seven question items to assess thenonlinear behavior of management derived fromUhl-Bien and Marion (2009) and Boal and Schultz(2007), including to what extent management stimu-lates dynamism, connects the past, present, andfuture of the firm, and creates organized disorder, etc.For bonding behavior of management, we asked ninequestion items derived from Uhl-Bien and Marion(2009), involving to what extent management fostersinterconnectivity and diversity, provides a structurefor information flow, and injects new ideas and

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information into organization. We asked seven ques-tion items to assess the attractor behavior of man-agement derived from Uhl-Bien and Marion (2009),Osborn et al. (2002), and Boal and Schultz (2007),including to what extent management acts as a tag(e.g., a flag around which everybody rallies), andrecognizes attractors and understands the nature ofthe movement they create.

The firm product innovativeness was assessed byasking five established question items adapted fromWang and Ahmed (2004), including to what extent afirm is first to market by new product and serviceintroductions, firm’s new products and servicesare often perceived as novel by customers, and newproducts and services of firm put it up against itscompetitors.

Environmental turbulence questions were adaptedfrom Jaworski and Kohli (1993). Three questionitems each were asked for market and technologyturbulence. Technology turbulence question itemsindicate the changes associated with new producttechnologies, and market turbulence question itemsshow the changes in the composition of customersand their preferences.

We should also note that although it is not thefocus of our study, some variables were included ascontrols because they were shown to affect key vari-ables in our study. For instance, researchers suggestthat firm size and age can have significant influenceon firm product innovativeness (e.g., Weiner andMahoney, 1981). Firm size was indicated by thelogarithm of the number of employees, and firm agewas assessed by the logarithm of the number of yearssince the firm was founded. Also, as the product/service development activities are perceived differ-ently in different industries or sectors, we asked ifthe organization operates in the manufacturing/production industry or in the service industry.

After developing the new question items in English,three academics from US-based universities, whohave industrial experiences of more than 10 years,evaluated the content and meaningfulness of the itemsto establish face validity. They did not note any diffi-culty in understanding the items or scales. These newand adopted question items were first translated intoTurkish by one person and then retranslated intoEnglish by a second person using the parallel-translation method. The two translators then jointlyreconciled all the differences. A draft questionnairewas developed, and then evaluated and revised indiscussions with three academics from Turkey, havingknowledge on organizational behavior and innovationas expert judges. The suitability of the Turkish versionof the questionnaires was then pretested by 10 part-time graduate students who are full-time employees

working in the industry. In addition, eight senior man-agers, randomly selected from a diverse cross-sectionof firms located in Istanbul, evaluated the content andmeaningfulness of the items. Respondents did notdemonstrate any difficulty understanding the items orscales. After confirming the questionnaire items, thequestionnaires were distributed and collected by theauthors, applying the ‘personally administrated ques-tionnaire’ method.

We used a stratified random sampling plan fromthe directory of Istanbul Chamber of Industry. TheIstanbul district was chosen in order to decrease sam-pling error of the study because this district is thecenter of the Turkish economy for manufacturing andservice sectors. A list of 350 eligible firms was gen-erated from the directory of Istanbul Chamber ofIndustry. The firms were selected because they (1)develop new products and export them to other coun-tries, such as United Kingdom, Germany, Arabiccountries, Central Asia, and Russia; (2) are organizedand managed based on a Western management style(e.g., they operate in accordance with ISO and Euro-pean quality standards); (3) are affiliated withWestern firms; and (4) have at least 30 employees, assuggested by Akgün et al. (2009).

First, we contacted the firms’ general managers bytelephone and explained them the aim of the study. Ofthe 350 firms contacted, 310 agreed to participate inthe survey study. By using the procedure of Kumaret al. (1993), we asked for at least two respondentsfrom each firm, who are the most knowledgeableabout the organization’s operations, culture andemployees, to fill out our surveys in order to reduce thesingle source bias. Those respondents are expected toserve as ‘key informants’ for others who work in thesame organization (Kumar et al., 1993). In particular,we believe that those key informants are likely toassess the social interaction, relations among people,organizational knowledge, past experiences, andinnovativeness more accurately due to their ‘bird’s-eye views’of the organization. Also, we asked that therespondents have top-level positions in their respec-tive areas and to be from different functions of theorganization. Further, they should have been workingin the firm for an average of over 5 years and have acollege or graduate degree. Following the procedureof Podsakoff et al. (2003), we informed each partici-pant that his/her responses would remain anonymousand would not be linked to them individually, nor totheir companies or products. In addition, we assuredrespondents that there were no right or wronganswers, and that they should answer questions ashonestly and forthrightly as possible.

Of the 310 firms that agreed to participate, 259completed our questionnaires. However, 24 firms

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responded with only one survey, resulting in 235firms. Since we asked for multiple responses fromfirms, we discarded these surveys from our analyses.Thus, our analyzable sample consisted of 235 firmswith 497 surveys (some firms supplied more than twosurveys). We compared the mean of variables, firmsize, and ages of the eliminated surveys with thesurveys used for the analysis, and found no statisticaldifference among them. In our sample, the respond-ents were senior employees/staffs (54%), seniorengineers (22%), functional/department managers(11%), technical leaders (6%), product/project man-agers (3%), general managers (2%), and owners ofthe firm (2%). The respondent departments werefinance (31%), engineering and design (28%), mar-keting (22%), manufacturing (12%), and humanresources (7%). The participating industries includedfinance (22%), service (21%), machinery and manu-facturing (15%), chemistry (9%), automotive (6%),metal (5%), information technologies (5%), pharma-ceutical (3%), communication (3%), food (3%), elec-tronics (3%), and textile (2%).

4.2. Common method variance assessment

Since data for the independent and dependent vari-ables are collected from the same informants,common method bias may lead to inflated estimatesof the relationships between the variables (Podsakoffand Organ, 1986). We checked for this potentialproblem using the Harman one-factor test (Podsakoffand Organ, 1986). The results of an unrotated prin-cipal component analysis indicate that commonmethod variance does not pose a serious problemin our investigation because several factors witheigenvalue greater than 1 were identified – explaining69.46% of the total variance – and because no factoraccounts for almost all the variance (i.e., highestsingle variance extracted is 37.21%). In addition, fol-lowing Lindell and Whitney (2001), we partialled outthe smallest correlation of the remaining correlationsin order to remove the effect of common method bias.Given that all unadjusted correlation coefficientsremain statistically significant at P < 0.05 afteradjusting for common method bias, we feel moreconfident that a serious threat of common methodbias does not exist in this study.

5. Analysis and results

5.1. Measure validity and reliability

We evaluated the reliability and validity of our vari-ables using confirmatory factor analysis (CFA)

(Fornell and Larcker, 1981; Anderson and Gerbing,1988). By using AMOS 4.0 (Arbuckle and Wothke,1999), we investigated all 10 variables (involving74 question items) in one CFA model using allsurveys (n = 497). After the elimination of problem-atic items, which have cross loads, the resultingmeasurement model was found to fit the data rea-sonably well: χ2

(989) = 2606.68, comparative fitindex = 0.90, incremental fit index = 0.90, Tucker-Lewis index = 0.89, χ2/df = 2.67, and root meansquare error of approximation = 0.05. Also, the par-simonious normed fit index = 0.77 is above thecutoff point of 0.70. In addition, all items loadedsignificantly on their respective constructs (with thelowest t-value being 2.50), providing support forconvergent validity.

To assess discriminant validity, a series of two-factor models, recommended by Bagozzi et al.(1991), were estimated in which individual factorcorrelations, one at a time, were restricted to unityby using AMOS 4.0. The fit of the restricted modelswas compared with that of the original model. Intotal, we performed 45 models – 90 pairs of com-parisons – using AMOS 4.0. The chi-square change(Δχ2) in each model, constrained and unconstrained,were significant, Δχ2 > 3.84, which suggests thatconstructs demonstrate discriminant validity.

Table 1 reports the reliabilities of the multipleitems, along with construct correlations and descrip-tive statistics for the scales. Table 1 shows that thereare some moderate to high correlations (ranges fromr = 0.60 to r = 0.73) among some of the variables.However, we should note that we were expectingthese scores because, in practice, for instance, devel-oping information or knowledge through reciprocalinterconnection is highly related to how peoplebridge the communication gap among others to speedup or enable certain activities (e.g., concept testing,prototype development, etc.). Table 1 also demon-strates that all the reliability estimates – includingcoefficient alphas, average variance extracted (AVE)for each construct, and AMOS 4.0 based compositereliabilities – are close to or beyond the thresholdlevels suggested by Fornell and Larcker (1981). Asa check for discriminant validity, as suggestedby Fornell and Larcker (1981), the square root ofAVE for each construct is greater than the latentfactor correlations between pairs of constructs (seeTable 1). After conducting these tests, we concludethat our measures have adequate discriminant andconvergent validity. Finally, skewness ranges from−0.74 to 0.23, and kurtosis ranges from −0.72 to0.78. These values are well below the level suggestedfor transformation of variables, skewness of 2, andkurtosis of 5, as indicated by Ghiselli et al. (1981).

System mechanisms, management practices, and firm product innovativeness

© 2013 RADMA and John Wiley & Sons Ltd R&D Management 44, 1, 2014 27

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Tabl

e1.

Cor

rela

tions

and

desc

ript

ive

stat

istic

s

Mea

nSt

anda

rdde

viat

ion

Var

iabl

es1

23

45

67

89

1011

1213

3.59

0.89

1Pr

oduc

tin

nova

tiven

ess

(0.8

0)

3.52

0.74

2St

rate

gic

reso

nanc

e0.

55**

*(0

.75)

3.37

0.85

3A

ccre

ting

node

s0.

50**

*0.

70**

*(0

.81)

3.28

0.74

4Pa

ttern

form

atio

n0.

43**

*0.

73**

*0.

70**

*(0

.74)

3.26

0.79

5C

atal

ytic

beha

vior

0.41

***

0.71

***

0.73

***

0.70

***

(0.7

5)

3.32

0.83

6B

ondi

ngbe

havi

orof

man

agem

ent

0.52

***

0.68

***

0.66

***

0.65

***

0.72

***

(0.7

4)

3.28

0.79

7N

onlin

ear

beha

vior

ofm

anag

emen

t0.

51**

*0.

67**

*0.

57**

*0.

61**

*0.

67**

*0.

69**

*(0

.71)

3.07

0.88

8A

ttrac

tor

beha

vior

ofm

anag

emen

t0.

47**

*0.

65**

*0.

61**

*0.

62**

*0.

67**

*0.

70**

*0.

70**

*(0

.82)

3.74

0.77

9M

arke

ttu

rbul

ence

0.10

**0.

17**

*0.

29**

*0.

21**

*0.

29**

*0.

21**

*0.

22**

*0.

19**

*(0

.73)

3.73

0.89

10Te

chno

logy

turb

ulen

ce0.

11**

0.18

***

0.23

***

0.19

***

0.26

***

0.17

***

0.21

***

0.23

***

0.54

***

(0.8

4)

2.56

0.87

11Fi

rmsi

ze0.

11**

0.11

**0.

10**

0.04

0.10

**0.

08*

0.13

**0.

08*

−0.0

10.

13**

*–

1.29

0.43

12Fi

rmag

e0.

07*

0.07

−0.0

1−0

.04

0.00

7−0

.08*

0.08

*−0

.01

−0.0

90.

010.

46**

*–

NA

NA

13In

dust

ry−0

.06

0.05

0.05

0.07

0.11

**0.

08*

0.09

*0.

060.

14**

*0.

26**

*0.

16**

*−0

.08

Com

posi

tere

liabi

lity

0.88

0.90

0.88

0.86

0.89

0.86

0.79

0.90

0.77

0.87

NA

NA

NA

Var

ianc

eex

trac

ted

0.64

0.56

0.65

0.54

0.56

0.55

0.51

0.68

0.53

0.70

NA

NA

NA

Cro

nbac

h’s

α0.

880.

900.

890.

860.

890.

850.

790.

910.

770.

86N

AN

AN

A

Inte

r-ra

ter

agre

emen

t(r

wg)

0.74

0.73

0.86

0.75

0.76

0.76

0.75

0.74

0.72

0.76

NA

NA

NA

Dia

gona

lssh

owth

esq

uare

root

ofA

VE

s.*P

<0.

1.**

P<

0.05

.**

*P<

0.01

.

Ali E. Akgün, Halit Keskin, John C. Byrne and Özgün Ö. Ilhan

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5.2. Hypothesis testing

To test our hypotheses, we performed a structuralequation modeling (SEM). However, before using theSEM analysis, as our unit of analysis is the ‘firm’, wefirst aggregated the question items of respondents,such that we got the average of each question itemanswered by the respondents in each firm. In ouranalysis, we found that all inter-rater agreement (rwg)values range from 0.72 to 0.86, well above the 0.60benchmark (Hurley and Hult, 1998), indicating asatisfactory level of inter-rater agreement foreach aggregate variable in a firm (see Table 1). Afteraggregating question items from individual (respond-ent) level to organizational level, we calculated thecomposite score for each of our variables and thenused them in the SEM analysis. Also, consistent withCAS theory, we allowed the parameters represent-ing the covariances across adaptive managementpractice-related variables and across CAS-relatedmechanism variables to be free during the analysis.Our analysis showed that most of the covariancesare significant, indicating that there is a covarianceamong variables. This means that the variables occursimultaneously. These results also present an expla-nation for the moderate to high correlations amongour variables.

Table 2 indicates that strategic resonance(β = 0.39, P < 0.01) and accreting nodes (β = 0.29,P < 0.01) are positively related to the firm productinnovativeness, supporting H1 and H2. However, wecould not find any statistical relationship betweenpattern formation (β = 0.04, P > 0.1) and catalyticbehavior (β = −0.13, P > 0.1), and firm productinnovativeness; thus H3 and H4 are not statisticallysupported.

Regarding the antecedents of mechanisms of CAS,Table 3 shows that bonding behavior of managementis positively associated with strategic resonance(β = 0.30, P < 0.01), accreting nodes (β = 0.52,P < 0.01), pattern formation (β = 0.29, P < 0.01), andcatalytic behavior (β = 0.42, P < 0.01), supportingH5. Also, our results demonstrated that nonlinearbehavior of management is positively associated withstrategic resonance (β = 0.29, P < 0.01), pattern for-mation (β = 0.16, P < 0.05), and catalytic behavior(β = 0.29, P < 0.01). However, we could not find anystatistical association between nonlinear behavior ofmanagement and accreting nodes (β = 0.06, P > 0.1),partially supporting H6. Further, we found thatattractor behavior of management is positively asso-ciated with strategic resonance (β = 0.23, P < 0.01),accreting nodes (β = 0.27, P < 0.01), pattern forma-tion (β = 0.31, P < 0.01), and catalytic behavior(β = 0.22, P < 0.01), supporting H7.

Regarding the role of environmental turbulence onthe adaptive management practices and mechanisms,we found that market turbulence is positively relatedto bonding behavior (β = 0.20, P < 0.01), nonlinearbehavior (β = 0.20, P < 0.01), and attractor behavior(β = 0.13, P < 0.1). We also found that technologyturbulence is positively related to nonlinear behavior(β = 0.13, P < 0.1) and attractor behavior (β = 0.21,P < 0.01), partially supporting H9. However, wecould not find any statistical relationship betweenenvironmental turbulence variables and mechanismvariables of CAS, thus not statistically supportingH10.

In order to test the mediating effect of mecha-nisms between adaptive management practices andfirm product innovativeness, we employed theBaron and Kenny (1986) procedure, where a vari-able (M) mediates the relationship between an inde-pendent variable (X) and a dependent variable (Y) if(a) X is significantly related to Y; (b) X is signifi-cantly related to M; (c) after X is controlled for, Mremains significantly related to Y; and (d) after M iscontrolled for, the X – Y relationship is zero. Steps(b) and (c) are the essential steps in establishingmediation, and step (d) is only necessary to prove afully mediated effect. Also, the presence of themediator (M) must reduce the impact of the inde-pendent variable on the outcome compared withwhen M is not present. Further, entering the media-tor into the AMOS-based SEM model should alsoresult in a significant increase in R2. To addressthese issues, we performed three different SEMmodels, as shown in Table 3:

• (a) model a, including all of the adaptive manage-ment variables (X) and the product innovativeness(Y), indicates that bonding behavior (β = 0.28,P < 0.01), nonlinear behavior (β = 0.15, P < 0.1),and attractor behavior (β = 0.16, P < 0.1) are posi-tively related to the product innovativeness, andR2

p.innov. = 0.32.

• (b) model b, covering the adaptive managementvariables (X) and mechanism variables (M), showsthat all adaptive management variables are posi-tively associated with all mechanism variables,except the relationship between nonlinear behav-ior and accreting nodes (β = −0.04, P > 0.1).

• (c) after adaptive management variables (X) arecontrolled, as shown in model c, it was foundthat strategic resonance (β = 0.27 P < 0.01) andaccreting nodes (β = 0.27 P < 0.01) are positivelyassociated with product innovativeness, whereascatalytic behavior (β = −0.31, P < 0.01) is nega-tively related to the product innovativeness.Also, mechanisms of CAS reduce the effects of

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adaptive management variables on the productinnovativeness, and inclusion of the strategicresonance, accreting nodes, pattern formation,and catalytic behavior in the model increased theR2 of product innovativeness (R2

innov. = 0.38).

Based on the above results, it is seen that strategicresonance, accreting nodes, and catalytic behaviorpartially mediate the relationship between adaptive

management practices and product innovativeness,partially supporting H8.

6. Discussion and implications

This study empirically showed that the mechanismsof CAS are related to firm product innovativeness, asshown in Figure 2. Specifically, we demonstrated

Table 2. Results of hypotheses

Hypothesis Relationship Path value Results

H1 Stg. resonance → Product innovativeness 0.39*** Supported

H2 Accreting nodes → Product innovativeness 0.29*** Supported

H3 Pattern formation → Product innovativeness 0.04 Not supported

H4 Catalytic behavior → Product innovativeness −0.13 Not supported

Bonding behavior → Stg. resonance 0.30***

H5 Bonding behavior → Accreting nodes 0.52*** Supported

Bonding behavior → Pattern formation 0.29***

Bonding behavior → Catalytic behavior 0.42***

Nonlinear behavior → Stg. resonance 0.29***

H6 Nonlinear behavior → Accreting nodes 0.06 Partially Supported

Nonlinear behavior → Pattern formation 0.16**

Nonlinear behavior → Catalytic behavior 0.29***

Attractor behavior → Stg. resonance 0.23***

H7 Attractor behavior → Accreting nodes 0.27*** Supported

Attractor behavior → Pattern formation 0.31***

Attractor behavior → Catalytic behavior 0.22***

Market turbulence → Bonding behavior 0.20***

Market turbulence → Nonlinear behavior 0.20*** Partially Supported

H9a Market turbulence → Attractor behavior 0.13*

Technology turbulence → Bonding behavior 0.12

Technology turbulence → Nonlinear behavior 0.13*

Technology turbulence → Attractor behavior 0.21***

Market turbulence → Stg. resonance −0.03

Market turbulence → Accreting nodes 0.08

Market turbulence → Pattern formation 0.03

H9b Market turbulence → Catalytic behavior 0.06 Not supported

Technology turbulence → Stg. resonance 0.04

Technology turbulence → Accreting nodes 0.03

Technology turbulence → Pattern formation 0.005

Technology turbulence → Catalytic behavior 0.06

Control var. Firm size → Product innovativeness 0.07

Firm age → Product innovativeness 0.03

Industry → Product innovativeness −0.09*

χ2(34) = 91.86, CFI = 0.97, IFI = 0.97, χ2/df = 2.70, RMSEA = 0.08

Path coefficients are standardized.*P < 0.1.**P < 0.05.***P < 0.01.CFI, comparative fit index’ IFI, incremental fit index; RMSEA, root mean square error of approximation.

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Table 3. Results of mediating hypothesis

Relationship Model A Model B Model C

Bonding behavior → Product innovativeness 0.28*** 0.16

Nonlinear behavior → Product innovativeness 0.15* 0.15

Attractor behavior → Product innovativeness 0.16* 0.08

Bonding behavior → Stg. resonance 0.29*** 0.29***

Bonding behavior → Accreting nodes 0.54*** 0.54***

Bonding behavior → Pattern formation 0.30*** 0.30***

Bonding behavior → Catalytic behavior 0.43*** 0.43***

Nonlinear behavior → Stg. resonance 0.29*** 0.29***

Nonlinear behavior → Accreting nodes −0.04 −0.04

Nonlinear behavior → Pattern formation 0.16** 0.16**

Nonlinear behavior → Catalytic behavior 0.21*** 0.21***

Attractor behavior → Stg. resonance 0.24*** 0.24***

Attractor behavior → Accreting nodes 0.28*** 0.28***

Attractor behavior → Pattern formation 0.32*** 0.32***

Attractor behavior → Catalytic behavior 0.24*** 0.24***

Stg. resonance → Product innovation 0.27***

Accreting nodes→ Product innovation 0.27***

Pattern formation → Product innovation 0.03

Catalytic behavior. → Product innovation −0.31***

Firm size → Product innovativeness 0.07 0.05

Firm age → Product innovativeness 0.05 0.03

Industry → Product innovativeness −0.11** −0.09*

χ2(11) = 39.22, CFI = 0.94,IFI = 0.94, χ2/df = 3.56,RMSEA = 0.10

Fullmodel

χ2(33) = 50.89, CFI = 0.98,IFI = 0.98, χ2/df = 2.21,RMSEA = 0.07

Path coefficients are standardized.*P < 0.1.**P < 0.05.***P < 0.01.CFI, comparative fit index; IFI, incremental fit index; RMSEA, root mean square error of approximation.

Firm product innovativenessMarket turb.

Strategic resonance

Accreting nodes

Pattern formation

Catalytic behavior

Bonding behavior

Nonlinear behavior

Attractor behavior

Technology turb.

Environmental conditions

Adaptive management practices

Mechanism of CAS Innovativeness

Figure 2. Actual model. CAS, complex adaptive system.

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that strategic resonance of a firm positively impactsits product innovation efforts. This finding leveragesthe previous studies on the concept of ‘strategic reso-nance’. For instance, while previous studies showedthe significant role of strategic resonance, forexample, aligning technological and organizationalcapabilities with firm strategic implementation, onthe success of process innovation efforts (Brown andFai, 2006), we illustrated the critical role of strategicresonance on the success of product innovations,as suggested by Rodríguez-Pinto et al. (2008). Thisfinding also improves our understanding on the align-ment of organizational capabilities with strategicmanagement in the NPD context. Specifically, whilepast studies showed the effects of alignment of tech-nological, market, and NPD-marketing activitieswith a firm’s strategy on the market performance ofnew products (Acur et al., 2012), there are fewstudies investigating the effects of harmony betweenfunctional capabilities and strategic planning andformulation on the market success of new products.We showed that firm product innovativeness will beimproved when firms’ R&D, marketing, and techno-logical capabilities work in harmony and resonatewith business-level strategy. Our results also empiri-cally indicated that accreting nodes positively impactthe firm’s chance to develop better and successfulnew products. This finding especially elevates ourunderstanding on the fuzzy front-end stage ofproduct development efforts, where user needs arediscovered and product ideas generated, in the NPDliterature (Reid and de Brentani, 2004). In particular,while previous studies argued that fuzzy front-endfits the CAS perspective, and proposed fewest strat-egies for effective management of it (see, Reid andde Brentani, 2004), we empirically showed that whenideas, information, and knowledge (1) are magnifiediteratively or successively, as in a recurring growthpattern, (2) accumulation proceeds through self-consistency and complementary beliefs, and (3)rapidly expand in importance throughout the organi-zation, that firm develops better and successful newproducts, a product with a competitive advantage.Also, this finding expands the notion of the criticalelements of effectiveness for information processingfor successful product design and developmentefforts, such that we showed that people combinequality and speed of information, and enhance infor-mal processes of networking and information sharingwith the notion of accreting nodes, as argued byBrentani and Reid (2011).

Interestingly, in this study, we could not find anystatistical association between pattern formation andproduct innovativeness. One reason might be dueto the significant covariances among mechanism

variables. That is, pattern formation affects productinnovativeness via strategic resonance and accretingnodes. This finding empirically supports the theoreti-cal arguments of Kraaijenbrink (2012), who dis-cussed that pattern formation acts an agent role onthe interactions among knowledge creation, applica-tion, integration, and retention, which have signifi-cant impact on product development project success.Another reason for the non-significant relationbetween pattern formation and firm innovativenessmay be related to sensemaking process in the productdevelopment process. As noted by Weick et al.(2005), pattern formation (e.g., patterning of atten-tion) is a part of the sensemaking process. Forexample, when people seek to understand the situa-tions via dialogue and discussions, they end up witha fragmented organization of knowledge during theproduct development process. It appears that peopleneed to integrate these patterns and to make thempart of organizational knowledge base (e.g.,organizational memory, project-related databases,etc.), engineering, or human factors for a successfulproduct development process. In this study, we werealso unable to find any statistical association betweencatalytic behavior and firm product innovativeness.The effects of the catalytic behavior on the productdevelopment efforts may be explained by thecovariant role of strategic resonance and accretingnodes. Indeed, consistent with CAS literature, weshowed that catalysts serve as executioners to enableactions, such as transforming strategic resonance andinformation/knowledge accreting into product devel-opment effectiveness (Lee and Sukoco, 2011; Muand Di Benedetto, 2011).

This study also demonstrated that adaptive man-agement practices impact the mechanisms of CAS inthe organizations. For example, when managementfosters interconnectivity, creates linkages, developsmoderately coupled structures in the organization,etc. (i.e., bonding behavior of management), peopleor departments (1) resonate and coordinate theiractions, (2) expand their information/knowledge, (3)accelerate their actions, and (4) interpret and createpatterns for new information. This finding leveragesour understanding on the term of ‘dynamic networksof interaction’ in the innovation context, as high-lighted by Uhl-Bien et al. (2007). In particular,unlike the static view of networks of interaction inthe NPD literature (Allen et al., 2007; Ngai et al.,2008; Bstieler and Hemmert, 2010), we highlight theevolutionary nature of networks facilitated by man-agement (Benson-Rea and Wilson, 2003). Also, weempirically illustrated that when management re-cognizes attractors and understands the nature ofthe movements they create, and acts as tags (i.e.,

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attractor behavior of management), that organizationwill implement adaptive mechanisms more success-fully. This finding increases our understanding of theconcept of ‘organizational ambidexterity’ by high-lighting the dynamic aspect of ambidexterity, asrecommended by Raisch et al. (2009), and showinghow organizations achieve ambidexterity, as notedby Gibson and Birkinshaw (2004). Specifically,previous studies focused on the balanced view ofambidexterity (March, 1991; Cao et al., 2009), whichis largely ‘static’ in nature, and indicates the optimalmix of exploitation and exploration at a point in time.With a CAS perspective in general and attractorbehavior of management in particular, we showedthat management can both sustain stability andrespond to perturbation and initiate change in thisstudy (Pryor and Bright, 2007). Attractor behavior ofmanagement also leverages our understanding on therole of management in the sensegiving process,which is the process of attempting to influence thesensemaking and meaning construction of people,in organizations (Gioia and Chittipeddi, 1991).Sensegiving perspective has an assumption that sensecan be owned by top management and that it can begiven to people through active stages of influencing(Gioia and Chittipeddi, 1991), or articulating thatvision to others (Hill and Levenhagen, 1995) inthe traditional writings. Here, we demonstrated that,especially with the tagging behavior of management,sense provided by management is produced withinteractions with people, as people recognize man-agement as a symbolic reference for their corre-sponding message (Holland, 1995; Boal and Schultz,2007; Pryor and Bright, 2007). Further, we illustratedthat nonlinear behavior of management where man-agement connects the past, present, and projects thefuture of the firm through storytelling; stimulatesdynamism, etc.; and improves the effectiveness ofCAS-related mechanisms. This finding advances ourunderstanding on the time aspect of improvisationalbehavior in the NPD literature (Moorman and Miner,1998). While past studies reconcile linear and cycli-cal perspectives of time in organizations through theconcept of improvisation (Crossan et al., 2005), theydid not specify how to converge the time aspect ofimprovisation (Boal and Schultz, 2007). In this study,we showed that with organizational storytelling,managers blend past and expected future together ina deep experience of the present to become moreadaptive to conditions. This finding also highlightsthe importance of counterfactual thinking (i.e.,thoughts about what might have been), whichwas relatively understudied in the NPD context(Hsu et al., 2009). The literature indicates thatcounterfactual thoughts explore alternative realities

to past events, involves a reconstruction of the past,and have a powerful impact on how individualsapproach the future. We showed that through story-telling and converging past, present, and projectedfuture, management helps people see the dynamicnature of organizational experiences and offers away to frame experience in a way that generate newpossibilities, leading organization to become moreadaptive.

Next, our findings illustrated that the adaptivebehavior of management is determined in a senseby the environmental context, such that manage-ment interacts and engages with the dynamic andcomplex market and technological conditions inwhich they operate to produce adaptive change foran organization. Interestingly, our results did notshow any significant statistical relationship betweenenvironmental turbulence variables and mechanismvariables. This finding shows that quickly changingtechnology and market information or knowledgestimulate the management for fostering adaptiveefforts, and those efforts lead to strategic resonance,accreting nodes, catalytic behavior, and patternforming. In a sense, adaptive management practiceslook like the ‘transmission mechanism’.

This study, finally, enriched the view of firmadaptiveness in the literature by the use of CAS theory.It is seen that a CAS perspective provides flexible andresponsive organizational structures (e.g., organicorganizational structure), and fractal organizationaldesign (e.g., a living organism).Also, by the use of CLtheory, this study upgraded our understanding regard-ing the role of management in the turbulent conditionsin the literature. Here, consistent with the theoreticalargument (Uhl-Bien et al., 2007; Uhl-Bien andMarion, 2009), it appears that adaptive managementoccurs in the face of adaptive challenges (e.g., turbu-lent market and technological conditions), rather thantechnical problems, such as the application of provensolutions to known problems.

From this research, the implications for managersare that the management should provide sufficientstructure as well as enabling conditions to promote theadaptability and product innovativeness. Specifically,management should develop a master product inno-vation plan and then link the functional capabilities tothat plan. Management should also blur some rolesof R&D, manufacturing, and marketing functions sothat they are diffused across the whole organizationbeyond functional-specific myopia. Also, the knowl-edge and understanding of what each function doesneed to be diffused throughout the organization.Indeed, functional specific myopia and core rigiditiesare issues that require insight and a concerted effortnot to follow. Management further should provide

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enough resources (e.g., funding, information, and per-sonnel) needed for product innovation efforts to thedifferent departments and individuals (e.g., the usualguideline is to use an X percent of sales for fundingsuch efforts), and foster a sense of unity and purpose(e.g., project vision) for them.

Management should also develop transactivememory system in the organization by creatingyellow pages, and a central database about the exper-tise of people for information and knowledge expan-sion. Management should also give some autonomyto people/functions, and form alliances and in-tegration for information/knowledge expansion bycreating advice and friendship networks. Next, man-agement should allow experimentation and improvi-sation, and give freedom to people for the synthesisof new information/knowledge. Further, manage-ment could foster feedback culture, which indicatesmanagement’s support for feedback, including non-threatening and behaviorally focused feedback, aswell as coaching to help interpret and utilize feed-back, throughout the organization.

Management, next, should encourage storytelling,iterative dialogue, and collective problem solving;develop common languages; and use metaphors andsymbols in order to generate new understandingsabout product innovation endeavors. Further, man-agement should take the position of role model forthe actions and adaptiveness. Indeed, when theenvironmental threat becomes overwhelming,people look at management to centralize authorityand take action. This effect is particularly true whenpeople feel they lack adequate resources or struc-ture to address the threat. Finally, managementshould generate surprise (e.g., creating artificialcrisis and anxiety) and select some people asknowledge catalysts (e.g., gatekeepers, informalleaders, who have social influence in the organiza-tion) in any learning initiative since managementhas limited time.

7. Limitations and future research

There are some methodological limitations in thisstudy. Specifically, due to the nature of the data, thegeneralizability of sampling is a limitation of thisstudy. The study was conducted in a specific nationalcontext, Turkish firms in general and Istanbul districtin particular. It is important to note that the readersshould be cautious when generalizing the results todifferent cultural contexts. A Turkish sample involv-ing the Istanbul district, like that of any culturallybound research, be it a major industrialized city in theUnited States, Europe, or Asia, etc., imposes some

constraints on the interpretation and application ofthe results. Utilizing a cross-sectional design withquestionnaires was also one of the limitations of thisstudy. Even though ‘surveying is a large and grow-ing area of research in the natural environment’(Graziano and Raulin, 1997), the method used (onlya questionnaire) may not provide objective resultsabout the flow of information or knowledge, which isan inherently dynamic phenomena, throughout theorganization. However, we should also mention thatas a cross-sectional field study, this research providessome evidence of associations.

We believe that the mechanisms of CAS andadaptive management practices of CL presentopportunities for future researches in the NPD lit-erature. For instance, the mechanisms of CAS canbe expanded by including the variables of genera-tion of both dynamically stable and unstable behav-ior, dissipation and phase transitions, and nonlinearchange, etc. Also, the antecedents of the mecha-nisms can be studied in great detail. For instance,how the level of loosely coupled behavior and thenumber of people or departments engaged in theiterative dialogue in the organization influencethe pattern formation of firms can be investigated.Next, how the organizational patterns emerge fromthe local agents and interactions, and the role oforganizational boundaries and historical interactionson the pattern formation, can be studied in greaterdetail. Also, the concept of catalytic behavior can beexpanded in the literature. For example, the rolesof integration and collaboration among people;boundary experiences, which are ‘shared or jointactivities that create a sense of community and anability to transcend boundaries among participants’(Feldman et al., 2006, p. 94); boundary objects ‘thatengage participants in joint deliberation’ (Schneider,2009, p. 61); and self-reinforcing behavior thatpeople gain from successfully achieving a task andfrom a reliance on intrinsic rewards on the catalyticbehavior can be investigated. Further, practices thatlead to the effective expansion and accumulationof information or knowledge can be studied. Forinstance, fractal organizational designs, organiza-tional improvisation, simultaneously autonomousand cooperative actions of people/departments, anddialectic and dialogic communication can be exam-ined. In addition to the positive effects of adaptivemanagement practices and mechanism of CAS onthe product innovation, the reverse influence of themon the product innovation efforts should be consid-ered in future researches. For instance, attractors canbe understood as the boundedness of organizationas they operate. In a sense, attractors are the limitswithin which product development projects operate.

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Also, as Waldrop (1992) noted, catalysts may reduceregularity of systems (e.g., organization, productdevelopment projects, etc.), and in some ways maysuffer from ‘core rigidity’ as the focus may betoo narrow or only in a field that one knows/understands. Finally, in this study, our sampleinvolves a variety of sectors and industries, such asfinance, information technologies, communication,manufacturing, automotive, metal, etc. For example,in the finance industry, the products range fromdeveloping new credit cards, loans, and funds todeveloping a systems for home banking via com-puter and the internet, and shared national and inter-national electronic transfer. For communicationindustry, the products include cellular, packet-switching services, information services, voice mes-saging and call accounting services, communicationswitching equipment and devices, etc. In futurestudies, our model and its related variables canexamine specific types of industries, such as soft-ware, high-tech manufacturing, chemistry, etc.

To conclude, in this study, we addressed the rel-evance of CAS and CL theory, which deals at a levelof abstraction, and is mainly used in the physical andlife sciences rather than in the social sciences likeinnovation management. We operationalized themechanisms of CAS and adaptive management vari-ables, and then tested the role of those variables onfirm product innovativeness. The results showed thatenvironmental turbulence triggers the adaptive man-agement practices, and then adaptive managementpractices influence the CAS-related mechanisms,which impact the firm product innovativeness. Thisresearch just scratches the surface of this important,but understudied, subject. Future researchers willfind the area of CAS and CL theory rich and fruitfulfor NPD literature.

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Ali E. Akgün is a Professor of science and technol-ogy studies in the School of Business Administrationat Gebze Institute of Technology, Turkey. Hereceived his PhD in technology management fromStevens Institute of Technology and his MS in Engi-neering Management from Drexel University. Hisresearch areas are new product/technology develop-ment, learning and complexity, and cognitive andsocial psychology in innovation management.

Halit Keskin is a Professor of science and technol-ogy studies in the School of Business Administrationat Gebze Institute of Technology, Turkey. Hereceived his PhD in management and organization

from Gebze Institute of Technology. His researchinterests include technology and innovation manage-ment, knowledge management, and human resourcemanagement in high-tech firms.

John C. Byrne is a Professor in the Department ofManagement and Management Science in the LubinSchool of Business of Pace University. He receivedhis PhD in technology management from StevensInstitute of Technology. His research interestsinclude leadership, affect, mood, and emotion in theworkplace; emotional intelligence; and personalityinfluences in teams and managerial personnel.

Özgün Ö. Ilhan is a PhD Student at the Departmentof Business Administration at Gebze Institute ofTechnology, Turkey. Her research focuses on newproduct/technology development, system dynamics,and manufacturing adaptability.

Appendix A. Measures

CAS mechanisms (new)

Strategic resonance

• Customer requirements and organizational capa-bilities are in harmony and resonate in our firm.

• There are continuous linkages and harmonizationbetween the market and the firm’s operationalcapabilities

• There are continuous linkages and harmonizationbetween all functions and all levels within theorganization.

• There are continuous linkages and harmonizationbetween the firm’s strategy and its operationalcapabilities.

• There is mutual understanding, and appreciationof each others’ limitations, responsibilities,resources, capabilities, etc. among people in ourorganization.

• We rectify both the organization process and con-tent of internal strategic planning and formulation.

• R&D, operations, and marketing functions reso-nate in a process of continual feedback, consulta-tion, and adjustments in our organization.

Dropped items

• The roles and responsibilities of R&D, manufac-turing, and marketing functions are blurred so thatthey are diffused across the whole organizationbeyond any technical definition or functional-specific myopia.

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• The functional boundaries of the organization arefuzzy.

• We have a fairly well defined stratified managerialand divisional structure within which there areestablished routines and behavior that meet thecurrent broad strategic goals.

• There are correlated actions among organizationalfunctions in our firm.

• People act like in concert in our organization.

• New information stemming from the various func-tions of the firm and its various interfaces withup and downstream elements (suppliers and themarket) is considered, and incorporated into theevolution and continual refining of the firmstrategy.

Accreting nodes

• New ideas rapidly expand in importance in ourorganization.

• Ideas or information/knowledge are magnifiediteratively or successively, as in a recurring growthpattern in our organization.

• New idea or information/knowledge begin to formby an accreting ‘snowball’ effect in which theinformation/knowledge stick together to formfractal-like aggregates.

• New idea or information/knowledge is dissemi-nated verbally colonized and episodically in ourorganization.

• New idea or information/knowledge accumula-tion proceeds through self-consistency andfancy complementary beliefs in our organization.

Dropped item

• New ideas or information/knowledge reweavesthrough the web of metaphors, stories, symbols,rhymes in our organization.

Pattern formation

• Management facilitates subtle dialogue amongpeople for interpreting the events in ourorganization.

• We isolate and communicate which information isimportant and what is given attention from anendless stream of events, actions, and outcomes inour organization.

• Individuals seek understanding of the situationvia dialogue and discussion in our organization.

• We have extensive language and an interpretivesystem to collectively pattern the situation.

• We emphasize self-adjustment and altering thefirm strategy with the change in environmentalturbulence.

• Influence patterns associated with ‘information’choices go beyond simple notions of survival andgrowth in our organization, such that patterningrevolving around issues of efficiency, quality,innovation, and profitability, as well as the well-worn topic of shareholder wealth.

Dropped items

• We have active dialogue and discussion up andacross levels to isolate what is important.

• We used different viewpoints to make our ideasprolific and vibrant in our organization.

• We use symbols, metaphors, or stories to organizeinformation from the environment into a knowl-edge structure.

Catalytic behavior

• People seed dreams, which constitute the aspira-tions or ambitions that give life its meaning anddirection, to speed or enable certain activities inour organization.

• We see the bigger picture and understand inter-relationships among its constituencies forspeeding up or enabling certain activities in ourorganization.

• We bridge the communication gap among others tospeed up or enable certain activities.

• We eliminate or destroy the old knowledge tocreate the new and more relevant to help othersspeeding up or enabling certain activities in ourorganization.

• We facilitate continuous participation inobtaining and analyzing data, refining indica-tors, updating issues, and sustaining dialogueto speed up or enable their activities in ourorganization.

• We define new performance measures and stand-ards to speed up or enable certain activities in ourorganization.

Dropped items

• A wide variety of terms and symbols are used toarouse emotions for speeding up or enablingcertain activities of people in our organization.

• We challenge the status quo when needed to speedup or enable certain activities of people in ourorganization.

• Electronic tools are used to speed up or enablecertain activities of people.

• Our firm has the capacity to construe social behav-ior in a multidimensional way for speeding up orenabling certain activities.

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• People are able to make connections betweenmultiple domains of knowledge in our organiza-tion to speed up or enable certain activities.

Adaptive management practices (new)

Bonding behavior

• Management embraces diversity and is comfort-able with divergent or conflicting ideas in ourorganization.

• Management fosters interconnectivity and createslinkages in our organization.

• Management injects new and challenging ideasand information into the organization.

• Management fosters information flows by build-ing personal networks of interconnectivity andinterdependencies.

• Management fosters the development of moder-ately coupled structures in which ideas can emergefreely and find one another.

Dropped items

• Management helps people develop ‘solutionswithout problems’ by allowing their participationto conferences or similar idea spawning activities.

• Management perceives problems as events thathappen to us and understand that we are part of thenetwork of events that created the problem.

• Management fosters information flow as asource of interconnectedness among people in ourorganization.

• Management provides a structure for knowledgeflows throughout the organization.

Nonlinear behavior

• Management connects the past, present, andfuture of our firm through storytelling in ourorganization.

• Management looks at an issue in the present with asense of the past and an awareness of the future inour organization.

• Management stimulates dynamisms in our organi-zation such that their actions can maintain thesystem at the edge of chaos.

• Management seeks to spawn emergent behaviorand creative surprises rather than to specify andcontrol organizational activities.

Dropped items

• Management facilitates dialogue and informalcommunication among people to help them in con-

necting past, present, and future (e.g., dialogueconveying history, storytelling).

• Management has a keen sense of timing whenhe/she act in any event in our organization.

• Management creates organized disorder in whichdynamic things happen at multiple locales withinour organization.

Attractor behavior

• Management recognizes attractors and under-stands the nature of the movements they create.

• Management stimulates the emergence orenhances the attractiveness of attractors.

• Management acts as a tag (e.g., a flag aroundwhich everyone rallies) for fostering the emer-gence of attractor dynamics.

• Management acts as a tag for creating a dynamicenvironment throughout the organization.

Dropped items

• Management is a powerful agent of change byassuming that timing and complex forces arepresent in our organization.

• Management imagines and effectively advancesnew ideas, capabilities, opportunities, and pos-sibilities within dynamic interactions.

• Management is aware of the potential of dynamicbehavior and works to enhance their problemsolving abilities.

Product innovativeness (adapted fromWang and Ahmed, 2004)

• In new product and service introduction, ourcompany is often first-to-market.

• Our new products and services are often perceivedas very novel by customers.

• New products and services in our company oftenput us up against new competitors.

• In comparison with competitors, our company hasintroduced more innovative products and servicesduring the past five years.

Environmental turbulence (adaptedfrom Jaworski and Kohli, 1993)

Technology turbulence

• The technology used in our products is rapidlychanging.

• The technology in the industry is changing rapidly.

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• A large number of new product ideas are beingmade possible through technological break-throughs in the industry.

Market turbulence

• Customers’ preferences change quite a bit overtime.

• Customers tend to look for new products all thetime.

• New customers tend to have product-related needsthat are different from those of our existingcustomers.

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