Path Dependence of Power Relations, Path-Breaking Change and Technological Adaptation

Mikko Valorinta, Henri Schildt, Juha-Antti Lamberg

Research output: Contribution to journalArticleScientificpeer-review

11 Citations (Scopus)

Abstract

We study path-dependence of technological systems and power relations inside companies. While existing literature suggests power relations and technology to be path-dependent and influenced by each other, interactions across these evolutionary processes remain poorly understood. We studied the history of four retail firms over forty years, applying event structure analysis to explicate key dynamics. Companies exhibited two episodes of converging path dependency, where power relations further increased technological inertia. In each case, power initially concentrated outside the central headquarters. Path-breaking change led all firms to centralize power and implement networked IT systems supporting central control. We discuss the ability of converging technological and organizational path dependencies to create competitive disadvantage. New widely available technological innovations can disadvantage a firm vis-à-vis its competitors when the firm's established power structure prevents it from fully exploiting the innovation, and the path dependence of power relations prevents adaptation. Thus, company owners should create path-breaking disruptions in power relations when technological adoption provides value.
Original languageEnglish
Peer-reviewed scientific journalIndustry and Innovation
Volume18
Issue number8
Pages (from-to)765–790
Number of pages26
ISSN1366-2716
DOIs
Publication statusPublished - 17.11.2011
MoE publication typeA1 Journal article - refereed

Keywords

  • 512 Business and Management
  • organizational power
  • information technology
  • retail industry
  • computers
  • path dependence
  • historical analysis
  • event structure analysis
  • KOTA2011

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