Changing Business Model through Cognitive Style:The Moderating Effects of Business Failure Experienc

Abstract

Despite the widespread concern about the incumbent’s responses to disruptive innovations, we still know little about why managers of small incumbent firms change their business models differently under the same cognitive style. By using survey data from a sample of 180 small incumbent firms, we found intuitive cognitive style did not have a significant relationship with either explorative business model change or exploitative business model change when controlling the condition of business failure experience. However, for those managers who have experienced business failure, the intuitive cognitive style was negatively associated with exploitative changes but positively related to explorative changes. On the contrary, the intuitive cognitive style was positively related to exploitative changes but negatively associated with explorative changes for those without failure experience.