Liability of Newness

Exactly what it says.

There’s a recent review of the concept’s contribution and impact-

Gianpaolo Abatecola, Roberto Cafferata, Sara Poggesi, (2012) “Arthur Stinchcombe’s “liability of newness”: contribution and impact of the construct”, Journal of Management History, Vol. 18 Iss: 4, pp.402 – 418DOI

http://dx.doi.org/10.1108/17511341211258747

The liability of newness predicts that, although monotonically declining with age, failure rates are high in the first years of the organizations’ lifecycle[3]. This construct tremendously expands the current thinking around organizational birth and mortality. In fact, the liability of newness shifts the attention of both scholars and practitioners to the understanding of not only why and how new business ideas can emerge, but also of why and how new business ideas can fail (Bonazzi, 2008). In particular, Stinchcombe argues that infant mortality is basically caused by the lack of “learning experience” (Stinchcombe, 1965, p. 148):

New organizations, especially new types of organizations generally involve new roles, which have to be learned; […] The process of inventing new roles, the determination of their mutual relations and of structuring the field of rewards and sanctions so as to get the maximum performance, have high costs in time, worry, conflict, and temporary inefficiency.

 

The Stinchcombe citation? –

Stinchcombe, A.L. (1965), “Social structure and organizations”, in March, J. (Ed.), Handbook of Organizations, Rand McNally, Chicago, IL, pp. 14293

See that Machiavelli quote, eh?

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