Study On Firms' Sustained Growth Based On Coevolution Of Organizational Adaptation And Strategic Choice

With the new economy coming and the market environment rapidly changing, firm sustained growth has increasingly becoming a critical topic in the domain of strategic management research. The existing strategic management literature mainly focuses on the issues on firm's survival or growth in steady environment, and these traditional theories have divided the two mainstream research camps of'natural growth'and'forced growth', thus, both camps have formed the subsequent different schools, respectively, i.e., one is school of'organizational adaptation', and the other is school of'strategic choice'. Both schools are at odds with the issue about sourcing of firm's sustained competitive advantage. The former explores the source of firm's sustained competitive advantage form organization's inner change, and emphasizes on the disclosure of firm's growth in the same competitive paradigm; while the later tends to open out the driver of firm'sustained growth from the process of market environmental change, and strive particularly to probe into firm's future growth in the transition of different competitive paradigms. However, essentially, these theories only solve the part problems emerging in the process of firm's sustained growth. Therefore, they difficultly reveal the nature of firm's sustained growth, and provide with robust theoretical guidance for strategic practice.This paper treats a firm as'businesses'landscape'that any one business's downfall may not lead to the firm's death. Organizational adaptation and strategic choice co-exist and complement in creation of sustained competitive advantage. In firm's long-term development, competitive advantage created by organizational adaptation and strategic choice may be manifestly staged and temporally alternate, thus, firm's sustained growth is driven by the co-evolutionary vigor of organizational adaptation and strategic choice. This paper firstly extends that co-evolution is the intrinsic dynamics of firm's sustained growth, and exposes that firm's growth is nonlinear. The results suggest that co-evolution is based on complementary interaction, the subsequent co-evolutionary mechanism can fundamentally ensure firm's sustained growth, and a single power can't support firm's long-term development.'Natural growth'and'forced growth', which are driven by co-evolution of organizational adaptation and strategic choice, construct the twisted-pair law of firm's sustained growth; this law shows quasi-periodicity, and the properly adjustment of the construction of organizational knowledge may achieve firm's healthy development.Secondly, in order to make the co-evolutionary mechanism efficiently implement, from the view of organizational adaptation, borrowing real options, this study analyses the opportunity of strategic choice is influenced by the change of organizational adaptation involving firm's opportunity identifiability, operating capability, investment ability, assets'complementary ability, and so on, and argues that ambidextrous organizations may make for firm's steady implementation of strategic choice. From the perspective of strategic choice, after exposure of organizational inertia, this study addresses the principles of organizational adaptation's transformation by term of complexity theory, and argues that firm's inner-outer communicative ability, organizational exploration learning, outer business opportunity uncertainty, and diversification, influence organizational adaptation's transformation. Lastly, my findings, based on a survey of 141 firms in central China, provide strong support some related fundamental propositions and core conclusions above, and some suggestions, which deal with the challenges in face of Chinese firms'sustained growth are given out. In addition, for strategic management research, some contributions and limitations are discussed.