Definition of co-evolution

A company's efforts to simultaneously adapt to and influence the external environment.

Co-evolution is the joint and interactive outcome of managerial intentionality, organisational efforts and environmental change.

It considers organisations, their populations and their environments as the interdependent outcome of managerial actions, institutional influences and extra-institutional changes (technological, sociopolitical and other environmental phenomena).

Co-evolution assumes that organisational and environmental changes occur in a simultaneous and interactive manner. Thus, strategy is not merely a passive response but rather a proactive intention to change both task and institutional environments facing the firm. Organisational and environmental changes are bi-directional, interactional and mutually influencing and evolving. Organisations and their parts, both internal and external (such as regulators, suppliers, competitors or partners), co-evolve with each other and with a changing environment.

Example

Mexico’s Cemex, the world’s top building solution company, has worked with the UK government through publishing sustainable development reports since 2007. Construction in the UK is highly regulated by the government, requiring foreign companies to operate under high standards concerning environment, quality, and safety. While Cemex works with the UK government to ensure such standard compliance, its executives also regularly meet UK officials in an effort to create a cost-effective environment that stimulates the entire industry’s international competitiveness.[1] 

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