Bridging adaptation perspectives to explore corporate crisis determinants: evidence from Fiat

Corporate crises have always been a topic of interest in management studies. Although, over the years, scholars have developed a plethora of heterogeneous research perspectives on this issue, to date, the literature still lacks a rigorous methodological approach to account for the factors determining a firm’s failure. The aim of this paper is to contribute to filling this gap. The evidence emerging from a reconstructive case study of the crisis and turnaround that occurred at the Italian automobile manufacturer Fiat in the decade between 1997 and 2007 forms the basis of the analysis. To understand the origins of the Fiat crisis, a sorting logic is presented based on a literature review of those management theories which, over the years, have been used to study organizational adaptation, i.e. the interpretation of the relationship between a firm and its competitive environment. Evidence from the case is then used to expand the initial sorting logic with new insights. These underline the importance of how a firm’s top management team perceptions can influence the failure of the overall adaptation process. In identifying the causes that determine a firm’s crisis, the methods adopted in this paper may help to contribute to the extant literature, because they support a call by scholars for research to find a common ground in this field.