Research on the Influence of the Consistency of Double Aspiration Losses on Strategic Change under Dynamic Environment

Abstract

Abstract: Based on the experience data of Chinese A-share listed companies in 2007-2017, this paper applies quadratic polynomial regression and response surface analysis techniques to discuss the impacts on strategic change of the consistency or inconsistency between historical aspiration loss and social aspiration loss as well as the adjusting role of environmental uncertainty. This study finds: as the historical aspiration loss-social aspiration loss grows more and more consistent, the degree of strategic change implemented by enterprises becomes higher and higher; in the case of consistency, compared with a smaller level of aspiration loss, enterprises make deeper strategic change facing a larger level of expectation gap; in the case of inconsistency, compared to big historical aspiration lo ss-small social aspiration loss, enterprises make deeper strategic change facing small historical aspiration loss-big social aspiration loss. It’s discovered after a further examination of the regulatory role of environmental uncertainty: compared with environments with low uncertainties, in environments with high uncertainties the positive driving effect that consistency between historical and social aspiration loss has on the extent of strategic change will be weakened; in the case of consistency, compared with environments with low uncertainties, in environments with high uncertainties the positive driving effect that aspiration loss has on the extent of strategic change will be weakened; in the case of inconsistency, compared with environments with low uncertainties, in environments with high uncertainties the differences in the extent of strategic change will be expanded in the two scenarios of big historical aspiration loss-small social aspiration loss and small historical aspiration loss-big social aspiration loss. This study offers a new perspective for understanding the influence consistency or inconsistency in company decisions has on strategic decisions of a company. Meanwhile, it deepens the understanding of literature on companies’ strategic response behavior in the case of aspiration loss.

Key words: behavioral theory of the firm, the consistency of aspiration loss, performance feedback, environmental uncertainty, strategic change

Chen Weihong, Zhong Xi, Lan Hailin, Xu Lang. Research on the Influence of the Consistency of Double Aspiration Losses on Strategic Change under Dynamic Environment[J]. Management Review, 2022, 34(4): 238-250.

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