Hyman (1995) cautions that a critique must acknowledge what is praiseworthy in a target article, and must complement any work, rather than discrediting. I am writing this critique considering the suggestions given in that work. Bingham and Eisenhardt (2011) have argued that heuristics which are learned from process experience constitute rational strategy in unpredictable environments. Through a qualitative study of six technology-based ventures engaged in internationalisation, they argue that firms develop simple rules from process experience. There is a simplification involved in a specific developmental order, and it constitutes a cyclical relationship. This simplification, as per them, is a dynamic capability.
Undoubtedly, the paper’s contributions are significant. It provides a process account of the way in which organisations develop heuristic portfolios. It introduces the simplification cycle as a novel construct. The paper received considerable scholarly attention and shaped subsequent research in strategy. It has a solid prescriptive conclusion — the claim that refined heuristics are rational and that simplification cycling is a dynamic capability. The methodological innovation of measuring explicit learning content directly is a genuine step forward. Usually, this is measured from performance changes. The authors instead triangulated non-directive event chronologies with directive wrap-up questions and required corroboration. This intensity of qualitative analysis is both rigorous and replicable.
The Rehabilitation of Heuristics
One of the most significant theoretical contributions of Bingham and Eisenhardt (2011) is the rehabilitation of “heuristics” within the strategy literature. Since Tversky and Kahneman (1974), the term was largely indicative of cognitive error and irrationality. Heuristics were thought of as shortcuts that would lead to sub-optimal outcomes — second-best solutions. This is where Bingham and Eisenhardt pivot toward the “fast and frugal” tradition of ecological rationality (Gigerenzer, 2008). According to this tradition, heuristics are often superior to complex models as they are robust to the noise of unpredictable environments.
This contribution is vital because it provides an explanation in the microfoundations literature for how firms navigate at the edge of chaos — where too much structure leads to rigidity and too little to collapse. By arguing that heuristics can constitute rational strategy, the paper offers a cognitive explanation for dynamic capabilities. Yet this view raises deeper questions: is strategy nothing but a set of smart rules of thumb? Where does foresight belong if strategy is only a heuristic portfolio?
The Missing Performance Standard
All the principal claims of the paper — transitioning from novice to expert heuristics, simplification cycling, and rational heuristics — suggest some sort of performance standard. None of these performance claims are really evaluated within the paper. In the simplification cycling construct, the paper documents that all six firms engage in it; Table 4 shows considerable heterogeneity in the timing and magnitude of cycling across firms. However, without any data on performance outcomes it is impossible to determine whether firms that cycled aggressively achieved better results. There is rich description of the construct, but its inferential power is limited.
The Assumed Linearity of Developmental Order
The authors identify a theoretically elegant developmental order, drawing on novice-to-expert transitions (Feltovich et al., 2006; Ericsson et al., 2000). The logic is as follows: novices first learn “what” and “how”; then they advance to more complex relationships of “when” (sequence and space) and “which is more important” (ranking). This is a well-organised stage-based model of capability creation. Yet it assumes a linear progression of cognitive complexity. It is entirely possible that in some industries or contexts, priority rules must be learned first out of necessity. Firms entering highly regulated markets, for instance, may need to develop ranking rules before selection rules for customers.
There is a further problem embedded in this linearity. Organisations that have progressed furthest along the developmental order are, by that logic, the most vulnerable to environmental shock — particularly discontinuous shock. Continuity is the assumption. When it breaks, the most refined heuristics may become the most dangerous.
The Double-Edged Simplification Cycle
Perhaps the most novel concept in the paper is simplification cycling — the idea that firms do not merely accumulate rules but prune them, maintaining cognitive plasticity and avoiding overfitting strategy to past experience that may no longer hold. Yet research from organisational ecology on imprinting (Stinchcombe, 1965) and competence traps (Levitt & March, 1988) suggests that once a firm settles on a simple rule that works, reversing course is extraordinarily difficult.
I see simplification cycling as a double-edged sword. In pruning its heuristic portfolio, a firm may discard a rule that would have been useful under a future environmental shift, leaving it more exposed than before. Sull (1999) argues that an increasingly refined strategic portfolio can be a recipe for active inertia — the firm continues applying its once-successful rules in fundamentally changed realities. This paradox is not addressed.
The Heuristic–Routine Distinction
The paper draws on Cohen et al. (1996) to distinguish heuristics from routines: routines specify quasi-automated action steps for particular problems, while heuristics supply a common structure for a range of similar problems without prescribing precise solutions. The distinction is theoretically appealing, but the paper’s own coding decisions reveal its fragility in practice.
Consider the heuristic documented for F-Meddata: “cold calling in host country by aggressive young Finn with phone book.” This rule specifies a mode (cold calling), an agent type (young, aggressive), a national identity (Finnish), and a tool (phone book). It is difficult to see how this differs from the “specific, repeated action steps” that Cohen and Bacdayan (1994) and Edmondson et al. (2001) identify as routines. The authors coded this as a procedural heuristic. If the distinction cannot be held at the level of coding, the conclusion that firms learn heuristics — rather than routines — may be less secure than claimed.
The Survivorship Structure and Boundary Conditions
The six technology ventures studied were all internationalising across multiple markets — an appropriate context for examining heuristic rationality. But I argue that none of these ventures encountered the specific kind of uncertainty that would constitute a genuine test: a discontinuous shock, a sudden structural shift in the competitive environment that renders previously learned behaviours unreliable. All six firms had survived long enough to complete multi-country business — a survivorship structure that does not invalidate the descriptive findings, but does constrain inferential claims about whether heuristic learning, rather than some other factor, explains performance differences.
The framework was tested in the slice of the environment spectrum where it is most likely to hold. What happens to heuristic portfolios when the environment shifts discontinuously? The design forecloses that question. Boundary conditions are underspecified. A point worth appreciating: the three-country design, combining firms from Finland, Singapore, and the United States, provides meaningful cultural variance. The paper’s citation impact is justified.
Conclusion
This paper made important contributions to both organisational learning theory and the psychology of strategy. The concerns raised here — about generalisability, ecological rationality, the heuristic-routine distinction, and the absence of performance validation — are directed at the paper’s most ambitious claims, not at its substantive core. In accordance with Hyman’s (1995) guidelines, acknowledging these limitations would strengthen rather than undermine the contribution.
A well-supported argument would hold that firms learn a portfolio of heuristics in a developmental order, and that simplification cycling is a distinct organisational phenomenon. That contribution stands. The further claim — that simple rules are categorically more rational than analytical approaches — requires evidence this paper does not provide. The former is enough to stand on its own merit.
References
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