Postprint version. Published in Industrial Marketing Management, Volume 36, Issue 6, January 1, 2007, pages 731-744.
NOTE: At the time of publication, the author Stern Neill was not yet affiliated with Cal Poly.
The definitive version is available at https://doi.org/10.1016/j.indmarman.2006.05.008.
Effective strategic planning demands that organizations develop an understanding of the forces shaping the situation by engaging the collective efforts and interpretive capabilities of various representatives of the organization. This study investigates the mechanisms by which such an understanding develops and, subsequently, shapes marketing strategy. Specifically, organizations are examined as sensemaking units stimulated by perceived environmental turbulence, cultural open-mindedness, and team functional diversity. These factors are modeled as determinants of an organization's sensemaking capability, which is comprised of communicative, interpretive, and analytical dimensions. This study argues that a developed sensemaking capability increases the potential range of strategic responses and, ultimately, enhances customer-based performance. The results from a sample of wholesale distributors suggest that organizations that maintain greater internal variety are better able to sense and respond to the environment.