Harvard Business School, Entrepreneurial Management Working Paper No. 09-042; Organization Science, forthcoming
Does a firm’s identity have an impact on its corporate strategy? More specifically, can a company’s corporate identity act as an inhibitor to necessary technological change, causing the company to miss important shifts in its underlying business or market? Those were a few of the questions the author of this paper set out to address after spending 10 years working with a promising startup that underwent a painful identity evolution before being acquired by a much larger competitor. This case study highlights how the company, handcuffed by its corporate identity, nearly missed an opportunity to transition from serving only the digital photography market to being a player in the broader digital storage market. The author suggests that managers pay close attention to the role of corporate identity and remain flexible enough to pursue new technologies, especially when they may be fundamentally at odds with a firm’s existing identity.
Technological advances can often challenge a firm’s identity. But knowing when to embrace change and how to manage its effects on the company’s identity can mean the difference between stagnation and success.