Analysing the dynamics of mental models using causal loop diagrams

Miles M Yang, Feifei Yang, Tingru Cui and Ying-Chu Cheng
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Miles M Yang: Macquarie University, Sydney, NSW, Australia
Feifei Yang: Asia Europe Business School, Faculty of Economics and Management, East China Normal University, Shanghai, China
Tingru Cui: School of Computing and Information Technology, University of Wollongong, Wollongong, NSW, Australia
Ying-Chu Cheng: Department of Business Management, National Sun Yat-Sen University, Kaohsiung City

Australian Journal of Management, 2019, vol. 44, issue 3, 495-512

Abstract: Substantial evidence suggests that managerial mental models play an important role in firm performance. Yet managerial mental models are not static but dynamic. This research investigates the creation and evolution of mental models over time and how this dynamic process influences strategic choice and firm performance. We adopt the causal loop diagramming method, with in-depth case analysis over a period of 12 years, as the primary investigatory approach. Our research contributes to knowledge by identifying the shared mental model of the top management team, represented in the causal loop diagrams, for each stage of the company’s development. Our findings suggest that the dynamics of managerial mental models explains the changes in firm performance over time. JEL classification: L2

Keywords: causal loop diagrams; mental model; performance change (search for similar items in EconPapers)
Date: 2019
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Persistent link: https://EconPapers.repec.org/RePEc:sae:ausman:v:44:y:2019:i:3:p:495-512

DOI: 10.1177/0312896218823831

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