This is what Zander was talking about. What really restrains and constrains a lot of behavior in organizations are stories about the organization s past. The stories seem to have such power that economists call this path-dependency. And when they talk about that, economists don t talk about what is it exactly in the past that makes a firm path-dependent, meaning that the road you took determines where you are going. The actual mechanism of how that works, they don t get into that.
Stories play a big role here.
A very big role. Take IBM for example. We tried that and it didn t work. Now, what they said was true. They had tried it and it hadn t worked.