Borne Identity: The role of organizational identification and reputation following disruptions

Abstract

The findings of recent studies on the role of organizational reputation in light of disruptions have been inconsistent: some suggest that high reputation attenuates the negative impact of disruptions on stakeholders’ decision to transact with the organization, while others find an amplifying effect. I address these inconsistencies by exploring how stakeholders’ organizational identification influences the way they interpret the role of organizational reputation following disruptions. The results of empirical analyses in the context of on-campus murders in U.S. universities in 2001-2009 indicate that disruptions are associated with fewer transactions by low-identification stakeholders and only highly reputable organizations experience this effect. The findings are opposite for high-identification stakeholders: this group increases levels of transactions with highly reputable organizations after disruptions. This study provides a promising resolution to the inconsistencies found in prior research by suggest...