Structuring an organization around a proven core technology creates a competency trap.

Evidence

When young organizations design or discover ways of operating that prove successful, they typically build their organization around what has become their ‘core technology’ (cf. Thompson, 1967). By structuring the organization around such a core technology, it may get caught in a ‘competency trap’ (Levitt and March, 1988): what works today may not work tomorrow (as organizational environments change). Previous successes can easily blind an organization to emerging gaps between their competencies and the evolving environmental demands (Jervis, 1997). — Georg Schreyögg and Jörg Sydow, The Hidden Dynamics of Path Dependence, 254

Categorization

• DEFINE: Names and defines ‘core technology’ and the ‘competency trap’ — the mechanism whereby competence itself blocks recognizing changed demands.
• XREF: Echoes the trust literature’s confirmation bias and inertia making reputations resistant to disconfirming evidence (Trust - Making and Breaking Cooperative Relations).