Strategy as a matter of beliefs: the recorded music industry reinventing itself by rethinking itself

Managerial and organizational cognition studies the ways cognitions of managers in groups, organizations and industries shape their strategies and actions. Cognitions refer to simplified representations of managers’ internal and external environments, necessary to cope with the rich, ambiguous information requirements that characterize strategy making. Despite the important achievements in the field, many unresolved puzzles remain as to this process, particular as to the cognitive factors that condition actors in framing a response to a discontinuity, how actors can change their models in the face of a discontinuity, and the reciprocal relation between cognition and action. I leverage on the recent case of the recorded music industry in the face of the digital technology to study these issues, through a strategy-oriented study of the way early response to the discontinuity was constructed and of the subsequent evolution of this response. Through a longitudinal historical and cognitive analysis of actions and cognitions at both the industry and firm-level during the period in which the response took place (1999-2010), I gain important insights on the way historical beliefs in the industry shaped early response to the digital disruption, on the role of outsiders in promoting change through renewed vision about important issues, and on the reciprocal relationship between cognitive and strategic change.