when CEOs perceive their environment to be predictable, they will focus their
efforts on improving judgment through accumulation of firm-specific insights
regarding operational concerns and potential efficiency gains. However, when
CEOs perceive the environment to be dynamic, they will most likely gear their
efforts towards external advice-seeking by acquiring insights from outside sources
to keep a close watch on the environment in order to be able to adapt swiftly by
imputing probabilities as events unfold. Gathering advice from external sources
provides interpretations from sources that may have identified blind spots that
could remain potentially unidentified by the CEO and, as environments become
more dynamic, CEOs can be expected to seek advice from outsiders to improve
their comprehension of changing opportunities and threats confronting the firm.
Thus, whereas higher perceived environmental uncertainty primes CEOs to
engage in problem-solving efforts geared at obtaining inputs to make sense of,
and cope with, forces that are beyond their direct control, when uncertainty is
perceived to be low and the environment regarded as predictable, CEOs will focus
on seeking insights to improve discretionary levers within the firm (Lee & Miller,
1996). Formally we can expect that all else being equal: