Chapter 4: Routines, ‘Going Concerns’ and Innovation: Towards an Evolutionary Economic Sociology
Marc J. Ventresca and William N. Kaghan Introduction: opening up the dynamics of routines The language of routines in much strategy and organization theory research today is grounded in ideas that live between the Carnegie tradition’s approach to organizational behavior and institutions (Cyert and March, 1962; March and Olsen, 1979; Cohen and Levinthal, 1990; March and Simon, 1993) and neo-Schumpeterian evolutionary economics (Nelson and Winter, 1982). This view treats routines (rather than individuals1) as the basic unit of organizational action, foregrounds programmed activity and gives primacy to selection and retention mechanisms operating over time as central to understanding processes of organizational stability, learning, adaptation, and decline. Current research explores how and to what degree routines build into broader organizational competencies and aﬀect organizational adaptation. The broad contemporary move in the study of organization routines highlights concern with explaining organizational and institutional innovation, a move in which traditional views of routines as ‘habitual/inertial’ and stable encounter diﬃculty. The gift of an evolutionary economics is to enjoin researchers to explore ‘creative’ aspects in the variation of routines and to be wary of assuming equilibrium conditions at both micro and more macro levels. In short, this work served to develop more fully the intuitions of Schumpeter’s ( 1983,  1975) imagery of ‘creative destruction’. In current research, these arguments emphasize how understanding the nature of the adaptation of organizational routines is critical to understanding how ﬁrms survive and possibly thrive (or decline and die) in competitive environments, and that modifying organizational...
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