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The exploration of relationships between cognition and action has gained increasing prominence in organizational studies in recent years. If cognition and action are linked, however, it is intuitively apparent that both should be related to performance. Performance linkages to cognition and action, although clearly important, have received considerably less study than those between cognition and action, and the existing work in this domain has been directed mainly at individual and group-level outcomes. An important area of concern that has received even less empirical attention is the investigation of the relationships among cognition, action, and organizational performance.
Studies dealing with cognitive processes have explored the effects of antecedent and contextual factors on decision makers' interpretations of information (e.g., Bateman & Zeithaml, 1989; Thomas & McDaniel, 1990) and the effects of strategic interpretation on organizational action (e.g., Meyer, 1982; Smart & Vertinsky, 1984). Other relevant work has focused mainly on the relationship between group schemas and decision makers' attributions of causality and their subsequent decisions (e.g., Clapham & Schwenk, 1991) or has used laboratory settings to test hypothesized interpretation-outcome linkages at an individual level (e.g., Fredrickson, 1985; Gioia & Sims, 1986; Walsh, Henderson, & Deighton, 1988). There has been, however, a notable lack of empirical work seeking to link "sensemaking"--which subsumes the key cognition-action processes of environmental scanning, interpretation, and associated responses (Gioia & Chittepeddi, 1991; Weick, 1979)--with organizational performance.
In the strategic context, increasing emphasis has been placed on understanding the link between how top managers make sense of information and how they act to influence organizational outcomes (Dutton, Fahey, Narayanan, 1983; Dutton h Jackson, 19S7; Nystrom Starbuck, 1984) Because modern organizational environments are complex and dynamic, a key role of top management has become providing meaningful interpretations for patterns of ambiguous information. Indeed, the imposition of meaning on issues characterized by ambiguity has become a hallmark of the modern top manager (cf. Smircich & Stubbart, 1985; Weick, 1979) Those interpretations are often seen as critical to the success and even the survival of organizations, mainly because of their implications for influencing action alternatives and subsequent outcomes (Dutton SL Duncan, 1987).
This study was intended to articulate and empirically investigate linkages between sensemaking processes and organizational performance in the strategic arena to provide insight into what...