Managerial Sensegiving in Times of Crisis: Facilitating Strategic Change Under High Distress

While prior research has provided rich insights into how strategic change unfolds through sensemaking and sensegiving, the existing literature has predominantly focused on contextual conditions characterized by relatively low levels of urgency and threat. My study contributes to addressing this gap by examining how the effort of leaders to effectively construct and disseminate meaning around strategic change is influenced by the context of an organizational crisis. Drawing on the drastic turnaround of multinational corporation ABB in the early 2000s, I find that the CEO effectively mobilized the company’s strategic change program to shift institutionalized cognitive schemes through sense breaking, sense specification, sense enactment, and sense reinforcement. In a supportive process, the CEO constructed meaning around the uncertainty surrounding the crisis to ensure continued commitment, establish clear expectations, create cognitive capacity, and invoke the company’s core identity. My analysis contributes to the body of work on managerial sensegiving by elucidating mechanisms and dynamics that allow for a particularly quick and abrupt shift in established interpretive schemes, all the while facilitating a continued, positive enactment of change.