Great Vessels Take a Long Time to Mature: Early Success Traps and Competences in Exploitation and Exploration

Abstract

This study warns organizations against falling into an “early success trap.” The timing of initial success may lead organizations to divergent evolutionary paths as their experience at early ages has a greater consequence for their evolution than does their experience at later ages. In particular, we propose that early initial success can be more detrimental to an organization’s performance and survivability than later initial success because exploratory competence takes a long time to develop. To investigate the consequences of the timing of success, we developed a model of organizational learning and adaptation that examines what happens after success, when a success trap occurs, and whether and how the timing of initial success matters. The results from the simulation of our model indicate that the phenomenon of (early) success traps is a complex product of interactions among organizational learning of competences in exploitation and exploration and adaptations of historical and social aspiration levels. We discuss how organizations can avoid success traps and sustain their survival and prosperity over the long term.