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Corporate Politics, Strategy

The Threat Rigidity Effect in Full Effect

Well, although the notion exists since the beginning of the 80’ies, this is the first time ever I heard of the existence of a so-called “threat rigidity effect”. Its symptoms do sound familiar though, when a company is faced with a negative downturn, some react according to the threat rigidity effect; when the company does, it is inclined to more narrowly and firmly focus on the one thing they do well, stop other things, and become more hierarchical and top-down in terms of management control (source).

While focussing on your core business might seem like a logical choice, the article linked above provides arguments against acting so and proposes four different tracks in order to avoid the threat rigidity effect:

  1. strategy is about curing the desease and not about healing the sick
  2. strategy is about thinking out of the box, instead of sticking to a “we have always done so”-mantra. When a company is incapable of trying out new ideas and changing its strategy accordingly, it stalls in the present day climate.
  3. strategy is about involving everyone, not only the board. Persons on the field often have clearer views – at least on some of the things happening in a company – than the “man above”
  4. strategy is about communication in clear terms. What good is an idea, if nobody understands it?

It all sounds quite acceptable and logical to me…, at least as one method of using a downturn as an advantage – yet I am on the fence whether it is applicable in all situations. That is not the reason why I posted this though; I did so, because I learned three new combined words today and they rang a bell. I have had companies react like that, but as with so many things, I was unable to pinpoint it as to what it was back then. I can now and will potentially be able to give a countermeasure approach should the occasion occur again.

Oh, and for those going through a company suffering from “TRE”, read on below. Acknowledging the desease already is a first step to its cure.

threat rigidity effect – Google Scholar

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