The past isn’t past: company managers could better utilise their firms’ historical narratives as a key strategic resource for the present, says new study published in the journal Business History, co-authored at Cambridge Judge Business School, University of Cambridge.
Author William Faulkner famously wrote that “the past is never dead. It’s not even past.” A new academic study, published this month in the journal Business History, says that company managers could better take advantage of a company’s history as a strategic resource for the present.
Dr Jochem Kroezen
“Historical narratives are more than just inert stories that organisations tell about the past,” says the study by academics in the UK, US, Canada and Brazil. “History can be used strategically to meet the needs of specific organisational goals in particular situations” through “managerial skill in producing knowledge about the past.”
Specifically, the study concludes that managers could use historical narratives to achieve four main goals – identity, culture, legitimacy and authenticity:
- Build “identity” to highlight an organisation’s uniqueness for internal audiences, including how an organisation maintained or recovered a certain character.
- Create organisational “culture” by emphasising values and desired behaviour that creates permanence and belonging, such as the way chocolate maker Cadbury nurtured its historical association with Quaker traditions to become a source of competitive advantage.
- Forge organisational “legitimacy” by emphasising the organisation’s current similarity to a given set of standards and expectations of external audiences for that field or industry. The Ontario wine industry, for example, successfully emphasised its historical attachment to European winemaking traditions.
- Create “authenticity” by emphasising the uniqueness of the organisation compared to other entities in the same field, such as the way Jack Daniel’s Tennessee Whiskey used historical narratives and marketing campaigns to become an “iconic, authentic symbol of the cowboy and rural America.”
“We often assume that the past is an object that we cannot transform,” says study co-author Dr Jochem Kroezen, University Lecturer in International Business at the University of Cambridge Judge Business School. “Although we don’t have the science fiction of time travel to alter past events, we do have significant control over how the past is perceived in the present.
“This especially holds for older and larger organisations. The complexity of such organisations means that no one would be able to get a complete comprehension of its entire past, nor would it be possible to construct one ‘correct’ account of the past. Managers who understand this are able to skilfully interact with their organisation’s past by highlighting particular aspects of the past over other facets, or choosing particular ways of framing past events that align with their strategies of the present.
“There’s an interesting juxtaposition: at a time when critics say that companies ‘spin’ too much about their current operations, our study suggests that firms could actually spin more about their past,” says Kroezen.
The study – entitled “The strategic use of historical narratives: a theoretical framework” – is co-authored by William M. Foster of the University of Alberta in Canada, Diego M. Coraiola of Positivo University in Brazil, Roy Suddaby of the University of Victoria in Canada, Dr Jochem Kroezen of Cambridge Judge Business School in the UK, and David Chandler of the University of Colorado in the US.
It has generally been “assumed that an organisation’s history is the same as the organisation’s past, that is, an organisation’s history is a strategic asset only because no other firm has experienced similar past events,” the authors say. “We focus, instead, on when narrative elements of organisation history can be used and why they might be used strategically.”
“The way the story of an organisation’s past is told will influence what the organisation can do, how it can be done, and who will be involved with the organisation in the future,” the study says. “Managers can identify different ways to build new historical narratives and to enhance current, effective organisational history-telling practices.”
To be sure, history isn’t always positive to companies and other organisations. Historical narratives have the potential to be sources of organisational liability, particularly when negative past associations between the organisation and its products are “rediscovered” to create negative accounts of the corporate past, and when historical narratives lead to “organisational inertia” and inability to adapt to new situations.
And as there are potentially different and even competing versions of a company’s past, the study acknowledges that there is an element of managerial spin to “create a particular version of the past that fosters identification within an intended internal or external audience.”
In conclusion, the authors say: “We have argued against a view of history as something that happens to an organisation. We have also rejected the idea that history is the exclusive output of the work of professional historians. Instead, we have argued that history is strategically created and recreated by managers in organisations.”