Dynamics of Performing and Remembering Organizational Routines

This study addresses the dynamic interplay between action and memory in organizational routines. We consider three distinct forms of memory procedural, declarative, and transactive and examine their roles in the formation, efficiency, and adaptability of organizational routines. We introduce an agent-based model simulating organizational routines as repeated patterns of sequential tasks accomplished by networks of individuals. We model the formation of new routines, and changes in established organizational routines resulting from loss of personnel (due to downsizing) and changes in environmental demands. We find that transactive memory enhances problem-solving efficiency and facilitates adaptation to novel problems. Declarative memory built from past experience facilitates efficient routines in stable contexts, but obstructs efficiency gains when the organization encounters novel problems.