REVISITING ORGANIZATIONAL INTERPRETATION AND THREE TYPES OF UNCERTAINTY

Interpretive theory and the concept of perceived environmental uncertainty have received great attention in the literature. Yet, despite the link between interpretation and uncertainty, little work has focused on integrating the dominant constructs into one framework or model and the empirical evidence is highly scattered. The aim of this paper is to move towards such a framework and to make a series of conceptual propositions regarding the impact of perceived uncertainty on interpretation processes. This conceptual paper extends existing conceptual work on perceived environmental uncertainty by linking the interpretation process to three different types of uncertainty: state, effect and response uncertainty. In this paper I propose that environmental scanning leads to lower state uncertainty, i.e. less uncertainty regarding the estimation of probabilities of events occurring in the external environment of the organization. I also propose that scanning leads to higher levels of perceived control over events and that the actual interpretation of event, in opportunity/threat terms, drives organizational reactions to these events.