Technology, Identity, and Inertia through the Lens of 'The Digital Photography Company'

Abstract

Organizations often experience difficulty when pursuing new technology. Large bodies of research have examined the behavioral, social, and cognitive forces that underlie this phenomenon; however, the role of a firm's identity remains relatively unexplored. Identity comprises insider and outsider perceptions of what is core about an organization. An identity has associated with it a set of codes or norms that represent shared beliefs about legitimate behavior for an organization with that identity. In this paper, technologies that deviate from the expectations associated with an organization's identity are labeled identity-challenging technologies. Based on a comprehensive field-based case study of the entire life history of a company, identity-challenging technologies are found to be difficult to capitalize on for two reasons. First, identity serves as a filter, such that organizational members notice and interpret external stimuli in a manner consistent with the identity. As a result, identity-challenging technological opportunities inconsistent with that identity may be missed. Second, since identity becomes intertwined in the routines, procedures, and beliefs of both organizational and external constituents, explicit efforts to shift identity in order to accommodate identity-challenging technology are difficult to accomplish. Given the disruptive nature of identity shifts, understanding whether technology is identity-challenging is a critical consideration for managers pursuing new technology.

Keywords: Technological innovation, organizational identity, organizational inertia, managerial cognition, category creation, industry emergence

JEL Classification: O32, M13