External representations in strategic decision‐making: Understanding strategy's reliance on visuals

Felipe A. Csaszar, Nicole Hinrichs and Mana Heshmati

Strategic Management Journal, 2024, vol. 45, issue 11, 2191-2226

Abstract: Research Summary External representations, particularly visuals, are important in strategic decision‐making. However, their pervasiveness and impact are not well understood in the strategy literature. Based on cognitive science research, we identify four cognitive functions crucial to strategic decision‐making that benefit from using external representations. We also propose a conceptual model and propositions that explain how the quality of strategic decision‐making depends on the interactions among task environment, external representations, and managers. We show that external representations influence in predictable ways the boundedly rational process of searching for new strategies. Key determinants include the manager's representational capability and the usability and malleability of the external representation. We discuss implications for users, designers, and teachers of external representations in strategy, as well as suggest avenues for future research. Managerial Summary This research points to the pivotal role of external representations, especially visuals, in strategic decision‐making. Drawing from cognitive science, this study identifies four critical cognitive functions that benefit from these external representations—working memory, long‐term memory, pattern recognition, and knowledge transfer. Further, the study highlights that external representations significantly influence the process of strategic decision‐making in predictable ways. Finally, we show that not all external representations are alike in their ease of use and a managers' ability to operate on an external representation, referred to as representational capability, greatly affects the decision‐making quality. The implications extend to users, designers, and educators of external representations, urging attention to the design and use of external representations for improved decision outcomes.

Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://doi.org/10.1002/smj.3613

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:stratm:v:45:y:2024:i:11:p:2191-2226

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0143-2095

Access Statistics for this article

More articles in Strategic Management Journal from Wiley Blackwell
Bibliographic data for series maintained by Wiley Content Delivery ().