Strategic Management Journal
Issue Date: 1998 (Vol. 19)
Pages: 323-338
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Procedural Justice, Strategic
Decision Making, and The Knowledge Economy
W. Chan Kim and Renée
Mauborgne
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Editor's Choice.
Collective knowledge building is a key strategic
task for firms' success today. But, creating and sharing knowledge
are intangible activities that can neither be supervised nor forced out
of people. They happen only when individuals cooperate voluntarily.
A key challenge facing strategic management is obtaining the voluntary
cooperation of individuals as firms formulate and implement their strategic
decisions. This essay draws on the rich body of procedural justice
research to address this critical issue. The authors argue that when
people feel their strategic decision-making processes are fair, they display
a high level of voluntary cooperation based on their attitudes of trust
and commitment. Conversely, when people feel that the processes
are unfair, they refuse to cooperate by hoarding ideas and dragging their
feet in conceiving and executing strategic decisions. The authors
further develop this argument into team performance wherein the attitudinal
and behavioral effects of procedural justice are corroborated with theory
and initial evidence of their bottom-line performance consequences.
They then build a theory, what they call intellectual and emotional recognition
theory, that can explain why procedural justice invokes the side of human
behavior that goes beyond outcome-driven self-interests and that is so
critical in the knowledge economy.
| W. Chan Kim is The Boston Consulting Group Bruce D. Henderson Chair
Professor of International Management at INSEAD, France.
Renée Mauborgne is The INSEAD Distinguished
Fellow and a professor of strategy and management at INSEAD, and a Fellow of the World Economic Forum.
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