Organizational Inertia and Momentum: A Dynamic Model Of Strategic Change

Abstract
This study provides an empirical test of Hannan and Freeman's theory of structural inertia. We examined the changes organizations undertook in response to a major environmental change. In addition, we examined the effects of the organizational changes on organizational survival. Contrary to inertia theory predictions, discontinuous environmental change was not associated with an increased probability of organizational change. Further, organizational change was unrelated to an organization's chances of survival. We evaluate inertia theory in light of these findings and suggest a revised formulation of the concept of inertia.

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