Porac: Competitive groups as cognitive communities: the case of Scottish knitwear manufacturers
8 important questions on Porac: Competitive groups as cognitive communities: the case of Scottish knitwear manufacturers
What does the article of Porac explorers?
In Poracs article it is argues that an important link between group-level and firm-level competitive phenomena are the mental models used by key decision makers to interpret the task environment of their organization. Describe the 2 levels of transactions among companies:
2 Cognitive level: competition must be analyzed based on mental models of decision makers and how such mental models lead to a particular interpretation of the competitive environment.
Through the process of induction, problem solving, and reasoning decision makers construct mental models of the solving competitive environment. Those models consist of minimal 2 visions regarding beliefs. Describe those (Porac)
2 Causal beliefs: about what it takes to compete successfully within the environment, which has been identified.
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Over time the mental models of competing strategists become similar> creating group level beliefs. Out of what (2) does a mental model consists (Porac)?
2 Inertial forces, incl. political/informational/resource constraints.
The framework Porac uses is a mutual enactment (vaststellen) framework, to link firm-level and group-level competitive activities. A crucial linking mechanism is the creation of socially-shared beliefs, which define the relevant set of rivals and guide strategic choices. What is established by those shared beliefs?
What are according to Porac two criteria to name one party a competitor?
2 Market: on the basis of product substitutes
What is Poracs conclusion regarding the Scottish knitwear industry?
What is the conclusion of Porac regarding mental models and strategic choices?
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