Organising environmental scanning: Exploring information source, mode and the impact of firm size

Recent research on environmental scanning has shown it to be an important part of many organisational processes related to strategy. A fundamental aspect of scanning behaviour is the mode or channel through which information is gathered. Existing research on mode selection and source use has suggested that managers prefer to use personal sources that are either internal to or external to the organisation depending on context. What is not clear, however, is why one source may be preferred to another and how different scanning modes might complement each other. We explore these issues through the collection and analysis of interview data from seven organisations of widely differing sizes. Using the organisation itself as the unit of analysis, we offer a number of theoretical contributions concerned with mode and source use in environmental scanning activity. We find that quality of information source may be less important in explaining source use than previous studies suggest. We also uncover heavy reliance on internal reporting on the environment, compiled using multiple channels, in larger companies. Furthermore, we present a variety of instances where scanning modes were used to complement one another in different ways, the patterns changing according to organisation size. Our findings, while exploratory and theoretical in nature, also have practical implications for growing organisations that wish to ensure their environment is scanned as effectively as possible.