Confirmation Bias: A Boundary Condition for Dynamic Managerial Capabilities in the Context of Strategic Change

This chapter delves into the phenomenon of confirmation bias and its detrimental effects on dynamic managerial capabilities (DMCs) in the context of strategic change. It begins by defining DMCs and their role in creating sustainable competitive advantages under changing conditions. The text then focuses on managerial cognitive capabilities, emphasizing the impact of biases such as confirmation bias on strategic change efforts. Confirmation bias, defined as the tendency to seek or interpret information in a way that confirms existing beliefs, is explored in detail. The chapter presents a conceptual framework that illustrates how confirmation bias can negatively impact the sensing, seizing, and reconfiguring components of DMCs, ultimately leading to ineffective strategic change. Through propositions and a detailed discussion, the text offers valuable insights into the micro foundations of DMCs and their links with cognitive biases. It concludes by suggesting avenues for future research, such as the interaction of individual biases at the team level and potential mitigation strategies.