Heavy political-activity focus erodes firms’ customer focus and competitiveness.

Evidence

We showed a significant negative correlation between the level of CPA and customer satisfaction. In this respect, the genuine duty of a company to serve the customers and market needs to its satisfaction is fading towards a minor priority. Resources and strategic direction cannot easily be shifted towards a market focus due to strategic inertia in the CPA focus of the company. Through the historic evolution of a firm, especially within former monopolistic markets such as infrastructure industries, and through self-reinforcing mechanisms, firms are vulnerable to losing their market focus. Thus, they fall back in competition if regulatory changes, such as the liberalization within the European Union, take place. — Georg Schreyögg and Jörg Sydow, The Hidden Dynamics of Path Dependence, 414

Categorization

• XREF: Connects to the book’s core self-reinforcing-mechanism and lock-in framing of path dependence.