Behind the Shell

Abstract

"Iron cage" appears to be mistranslated from Weber's "Gehäuse" by Parsons. Correctly speaking, it has been noted that the word should be translated as "shell," which presents an extremely promising possibility in management studies: what appears to be a talisman on the front has rigid persons clinging onto the other side. If a shell has a competitive advantage, this would excuse the rigidity. However, if the shell is losing, or has already lost, its competitive advantage, clinging onto it becomes a problem. For example, Ford and IBM grew rapidly by clinging onto their shells-the Model T Ford in the case of Ford and the System/360 for IBM. However, these companies gradually went into decline later as their product design fossilized. Apart from product designs, it is easy to find examples of shells in companies that have experienced periods of growth and maturity, for example, retail networks, parent company sales power, real estate, patents, and franchise. Both managers and employees are fully aware that they can no longer expect growth as long as they cling onto their shell. Even so, the shell remains a source of rent. Hence, they are clinging onto it and are being driven to their ruin by inches.

Positive effect of cost pressure

“…These FI activities, in turn, became services that were offered externally and even went on to became paid services. The existence of sunk cost pressure caused the company to explore ways of leveraging its management resources through repeated trial and error (Wada, 2015), which eventually induced executives and employees to break out of their shells (Takahashi, 2015) …”

The core rigidity of Japanese home video game companies

“…2 When a business gains a core capability that gives it a competitive advantage, it tends to continue using that capability. As a result, this core capability becomes a core rigidity, as the company becomes unable to adapt to environmental changes by rebuilding and integrating flexible capabilities (Leonard-Barton, 1992;Takahashi, 2015). (Shintaku, 2003).…”

Snow Brand Milk crossed the divide between institutional and competitive isomorphism

“…In fact, many Japanese companies have created specialized departments for compliance, maintaining various systems and rules related compliance in company workplaces, and have also implemented various types of training. However, there are questions as to the effects of such activities, and cases of scandals in large companies as 1 Further, DiMaggio and Powell took Weber's concept of the "iron cage" and stated that isomorphism impacts corporate activities, though in recent years the mistaken "iron cage" translation of Talcott Parsons has been said to be "gehäuse" in Weber's original German, which should be translated as "shell" (Takahashi, 2015).…”