Abstract

While researchers have examined many antecedents of marketing strategy, there is scant research assessing the effect of organizational cognition. In this study, organizational cognition is examined in terms of the firm’s strategic complexity, which is its capacity to integrate multiple environmental dimensions during marketing strategy making. The results from a sample of wholesale distributors reveal four strategic groups that differ based upon their degree of strategic complexity. Results support the proposition that strategic complexity is an organizational capability that enables more effective strategy making and produces superior firm performance.

Introduction

Organizational competencies such as innovation, flexibility, and responsiveness result from collective cognition or sensemaking. A sustainable competitive advantage derives from the firm’s capacity to successfully assimilate, negotiate, and capitalize on complexities in its environment. Marketing performs a key role in an organization’s sensemaking efforts through gathering, disseminating, interpreting, and storing activities that seek to understand and act upon the environment (Sinkula, 1994). In this role, marketing potentially shapes and directs the lens through which the organization perceives its strategic situation, and by extension, the actions taken in response.