Technology, Identity, and Inertia through the Lens of ‘The Digital Photography Company’
Executive Summary — Why do established firms find some technological change so challenging? While existing research has identified numerous sources of inertia in established firms exploring new technological domains, identity is a critical piece of the puzzle. As the core essence of an organization, identity directs and constrains action. The routines, procedures, capabilities, knowledge base, and beliefs of an organization all reflect its identity. So when a technology is identity-challenging to an organization—when pursuing it would violate the core beliefs of both insiders and outsides about what the firm represents—organizations face significant obstacles to adopting it. This study by Tripsas highlights the importance of recognizing and evaluating the tradeoffs associated with technological opportunity and organizational identity. Key concepts include:
- Identity serves as a lens that filters a firm's technical choices. It influences what gets noticed, how it is interpreted, and what action is taken. Opportunities that challenge identity may simply pass by unnoticed.
- The self-reinforcing dynamics among internal identity, external identity, organizational action, and the industry and technological context create a strong impediment to change.
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.