Abstract

A growing stream of research in the strategy field explores in a social constructionist approach the competitive structures of industries from the perspective of industry participants. This work has indeed demonstrated that managers tend to develop strategic group representations based on categorization processes in order to simplify and make sense of their competitive environment. However, in most cases these studies focused on mature industries facing few environmental upheavals or protected from external threats. The aim of this paper is to extend this line of research by examining, in an increasingly dynamic industry, how top managers consider, regarding their own historic strategic group knowledge structures, new types of firms entering their traditional domestic competitive space. The main result, consistent with the cognitive inertia hypothesis, is that top managers tend to rely on cognitive maps that reflect obsolete industry boundaries rather than on configurations taking into account new competitive threats.

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