Contemporary Agent-Based Models of Organizational Routines · 2014. 11. 25. · 13 ABMs of organizational routines Why these 4 models? 1. An organizational routine is modeled specifically

Contemporary

Agent-Based Models of

Organizational Routines

Cara H. Kahl & Matthias Meyer

Institute of Management Control & Accounting

Hamburg University of Technology, Germany

2

Agenda

• Objectives

• Describing organizational routines

• Contemporary ABMs of organizational routines

• Conclusions

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Objectives

4

Objectives

• Scientific work on routines is accumulating.

• And there are still debates on conceptual issues such as:

• Does the concept of a routine encompass behavior and cognition?

• Does the individual or the organization affect a routine more?

• Must steps of a routine occur in an order to be considered a “routine”?

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Objectives

• Also, agent-based models formalizing “fuzzy” parts of the whole are emerging.

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Objectives

• Also, agent-based models formalizing “fuzzy” parts of the whole are emerging.

How are they doing this?

And what can we learn from it?

7

Agenda

• Objectives



• Conclusions

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Describing organizational routines

“regular and predictable behavior patterns of firms” (Nelson & Winter, 1982, p. 14)

“repetitive patterns of interdependent organizational actions” (Parmigiani & Howard-Grenville, 2011, p. 419)

“an executable capability for repeated performance in some context that has been

learned by an organization in response to selective pressures” (Cohen et al., 1996, p. 638)

“not actions per se, but they have the potential to shape actions” (Ter Bogt & Scapens, 2014, p. 5)

“collective phenomena” (Breslin, 2014, p. 64)

“multi-level mechanisms” (Vromen, 2011, p. 175)

“generative systems” (Pentland, Hærem, & Hillison, 2010, p. 934)

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Describing organizational routines

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Agenda

• Objectives



• Conclusions

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ABMs of organizational routines

Pentland, B. T., Feldman, M. S., Becker, M. C. & Liu, P. (2012). Dynamics of

organizational routines: a generative model. Journal of Management Studies, 49(8), 1484–1508.

doi:10.1016/j.respol.2007.12.012

Gao, D., Deng, X. & Bai, B. (2014). The emergence of organizational routines from habitual

behaviours of multiple actors: an agent-based simulation study. Journal of Simulation, 8(3), 215–230.

doi:l0.l057/jos.20l4

Miller, K. D., Choi, S. & Pentland, B. T. (2014). The role of transactive memory in the

formation of organizational routines. Strategic Organization, 12(2), 109–133.

doi:10.1177/1476127014521609

Cohen, M. D., Levinthal, D. A. & Warglien, M. (2014). Collective performance: modeling the

interaction of habit-based actions. Industrial and Corporate Change, dtu005.

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Why these 4 models?

1. An organizational routine is modeled specifically based on accounts derived from

literature discussing how the phenomenon can be conceptualized in the first place.

2. An organizational routine is the intended emergent outcome of the simulation.

3. Theoretical work on organizational routines is incorporated differently across the 4

models, therewith creating diversity in the sample.

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Why these 4 models?

1. An organizational routine is modeled specifically based on accounts derived from

literature discussing how the phenomenon can be conceptualized in the first place.

2. An organizational routine is the intended emergent outcome of the simulation.

3. Theoretical work on organizational routines is incorporated differently across the 4

models, therewith creating diversity in the sample.

Pentland et al. (2012) → focuses on actions as basic entities

Gao et al. (2014) → models an empirical socio-technical system

Miller et al. (2014) → incorporates a form of distributed cognition

Cohen et al. (2014) → makes detailed assumptions about individual cognition in context

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21

Agenda

• Objectives



• Conclusions

22

Conclusions

How are authors modeling organizational routines?

• They’re doing it!

• They’re addressing / incorporating essential features such as:

• Organization

• Triggers

• Patterns

• Multiple actors

• Individual / collective behavior

• Individual / collective cognition

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Conclusions

How are authors modeling organizational routines?

• They’re doing it!

• They’re differentially addressing / incorporating essential features , for instance:

• Organization (specific vs. unspecific reference)

• Triggers

• Patterns (predefined vs. emerging order)

• Multiple actors (social, socio-technical, unspecific)

• Individual / collective behavior

• Individual / collective cognition (various constructs, mixed levels)

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Conclusions

What can we learn from this about modeling organizational routines?

• Which organization is being modeled?

• Whose routine is being modeled?

• Distinction between behavior and “cognition” (and their indicators!)

• Representation of individual and “collective” levels

• Who is modeling similar phenomena?

25

Literature

Breslin, D. (2014). Calm in the storm: Simulating the management of organizational co-evolution. Futures, 57, 62–77. doi:10.1111/j.1467-6486.2012.01063.x

Cohen, M. D., Burkhart, R., Dosi, G., Egidi, M., Marengo, L., Warglien, M. & Winter, S. (1996). Routines and other recurring action patterns of organizations: contemporary research issues. Industrial and Corporate

Change, 5(3), 653–698.

Cohen, M. D., Levinthal, D. A. & Warglien, M. (2014). Collective performance: modeling the interaction of habit-based actions. Industrial and Corporate Change, dtu005.

D’Adderio, L., Feldman, M., Lazaric, N. & Pentland, B. (2012). Call for papers - Special issue on routine dynamics: Exploring sources of stability and change in organizations. Organization Science, 23(6), 1782–1783.

doi:10.1287/orsc.1120.0800

Felin, T., Foss, N. J., Heimeriks, K. H. & Madsen, T. L. (2012). Microfoundations of routines and capabilities: Individuals, processes, and structure. Journal of Management Studies, 49(8), 1351–1374.

doi:10.1111/j.1467-6486.2012.01052.x

Gao, D., Deng, X. & Bai, B. (2014). The emergence of organizational routines from habitual behaviours of multiple actors: an agent-based simulation study.

Gevers, J. M. P., Passos, A. M. & Uitdewilligen, S. (2014). Call for papers: Special issue on “Team adaptation and the dynamics of team cognition.” European Journal of Work and Organizational Psychology.

Retrieved from http://www.tandf.co.uk/journals/cfp/pewocfp.pdf

Jack, L. & Mundy, J. (2013). Routine and change: the role of management accounting and control. Journal of Accounting & Organizational Change, 9(2), 112–118.

Lazaric, N. (2011). Organizational routines and cognition: an introduction to empirical and analytical contributions. Journal of Institutional Economics, 7(02), 147–156. doi:10.1017/S1744137411000130

Miller, K. D., Choi, S. & Pentland, B. T. (2014). The role of transactive memory in the formation of organizational routines. Strategic Organization, 12(2), 109–133. doi:10.1177/1476127014521609

Murji, K. & Neal, S. (2014). Call for papers - Sociology special issue on the sociologies of everyday life. Sociology. Retrieved from http://www.britsoc.co.uk/media/61136/sociologies_of_the_everyday_CFP.pdf

Nelson, R. R. & Winter, S. G. (1982). An evolutionary theory of economic change. Cambridge, MA: Harvard University Press.

Parmigiani, A. & Howard-Grenville, J. (2011). Routines revisited: Exploring the capabilities and practice perspectives. The Academy of Management Annals, 5(1), 413–453. doi:10.1080/19416520.2011.589143

Pentland, B. T., Feldman, M. S., Becker, M. C. & Liu, P. (2012). Dynamics of organizational routines: a generative model. Journal of Management Studies, 49(8), 1484–1508. doi:10.1016/j.respol.2007.12.012

Pentland, B. T., Hærem, T. & Hillison, D. (2010). Comparing organizational routines as recurrent patterns of action. Organization Studies, 31(7), 917–940. doi:10.1177/0170840610373200

Ter Bogt, H. J. & Scapens, R. W. (2014). Institutions, rationality and agency in management accounting: Rethinking and extending the Burns and Scapens Framework. Available at SSRN 2464980.

doi:10.2139/ssrn.2464980

Thank you for your attention!

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Extra

• The models selected for comparison were retrieved with an extensive literature search.

• Articles containing the word pairs “routine” and “agent-based” or “routine” and “multi-agent” in

their titles, abstracts or keywords were searched in the following databases: Ebsco, Web of Science,

Jstor, Science Direct, EconBiz and SSRN.

• Afterwards, and in a similar manner as reported by Parmigiani & Howard-Grenville (2011), the

same word pairs were searched in the following journals: Academy of Management Journal,

Administrative Science Quarterly, Management Science, Organization Science, Strategic

Management Journal, Industrial and Corporate Change, Journal of Management Studies,

Organization Studies and Strategic Organization.

• Databases as well as journals were searched from 1996-2014; 1996 was chosen as a limit due to the

seminal paper by Cohen et al. (1996) summarizing their Santa Fe Institute conference to establish a

common conceptualization of organizational routines.

• The search resulted in 22 contributions, whereas some do not incorporate conceptualizations of

organizational routines, and others do not portray agent-based models.

28

Extra

The four models discussed in this section were chosen based on the following process:

• Firstly, their authors model an organizational routine specifically based on accounts

derived from literature discussing how the phenomenon can be conceptualized in the

first place.

• Secondly, an organizational routine is the intended emergent outcome of the simulation.

• Thirdly, they were chosen based on the differential way they incorporate theoretical

work on organizational routines, therewith creating diversity in the sample:

• The first model focuses on actions as basic entities,

• while the second models an empirical socio-technical system.

• The third model incorporates a form of distributed cognition,

• and the fourth sophisticated assumptions about individual cognition in context.

29

Extra

Among the models not chosen for comparison were those depicting business design

processes, workflow management systems or process systems engineering (Siirola,

Hauan, & Westerberg, 2003; Sikora & Shaw, 1998; Yang, Sung, Wu, & Chen, 2010). Others

focus primarily on the exploration and exploitation of knowledge (Aggarwal, Siggelkow,

& Singh, 2011; Geisendorf, 2009; Kim & Rhee, 2009; Siggelkow & Levinthal, 2005),

capabilities (Maritan & Coen, 2004), norms (Criado, 2013), or other aspects of

organizational design (Bruderer & Singh, 1996; Levitt, 2012; Siggelkow, 2011). Some

contributions explicitly model routines without reference to the conceptualizations

elaborated (Groff, 2007; Rouchier, Bousquet, Requier-Desjardins, & Antona, 2001; Silva,

Gonçalves, Dimuro, Dimuro, & Jerez, 2013); nonetheless they describe targets which, in a

face valid way, constitute organizational routines, such as meeting scheduling (Chun, Wai,

& Wong, 2003) or the process of entrepreneurship (McMullen & Dimov, 2013). A final

paper worth noting is authored by Gaskin, Berente, Lyytinen, & Yoo (2014), who report a

computational model of sociomaterial routines. These models were briefly mentioned here

to inform the interested reader of similar developments beyond the ones compared later in

this section.

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Contemporary Agent-Based Models of Organizational Routines · 2014. 11. 25. · 13 ABMs of organizational routines Why these 4 models? 1. An organizational routine is modeled specifically