ORGANIZATIONAL LEARNING IN TARGET SETTING

• 成果类型: Article
• 署名作者: Aranda, Carmen; Arellano, Javier; Davila, Antonio
• 署名单位: University of Navarra; University of Navarra; University of Navarra; IESE Business School
• 刊物名称: ACADEMY OF MANAGEMENT JOURNAL
• ISSN/ISSBN: 0001-4273
• DOI: 10.5465/amj.2014.0897
• 发表日期: 2017
• 页码: 1189-1211
• 关键词: ASPIRATION-LEVEL ADAPTATION; BEHAVIORAL-THEORY; instrumental variables; STRATEGIC PERSISTENCE; performance; firm; FAILURE; success; Heterogeneity; exploitation

摘要

This paper examines organizational learning in a target setting. Organizations commonly set targets-explicit and quantitative reference points-for their operational units that reflect top management aspirations for these units. Targets are commonly the outcome of a subjective process where supervisors combine their explicit and tacit knowledge to set performance expectations for their units. Using a proprietary database from a large European travel company during a period of rapid expansion, we document the effect of organizational learning by studying how targets change as units mature. In particular, we examine managers' experiential learning from branches' past performance and their vicarious learning from branches in the same region in determining performance expectations over the life cycle of branches. Our results indicate that, in setting performance targets, managers increase the weight of a branch's past performance and decrease the weight of comparable branches' performance as the branch matures. Vicarious learning, where managers extrapolate the performance of comparable branches to a new branch, dominates in the early years. Over time, this type of learning is replaced by experiential learning as experience accumulates. We document how early on in the life of branches, these two types of learning interact; this interaction disappears as branches mature. Furthermore, we find that managers learn differently from successes and failures early in the lives of the new units, and this learning is affected by the magnitude of the successes and failures.