Change in the Presence of Fit: the Rise, the Fall, and the Renaissance of Liz Claiborne

Abstract

A new framework that addresses how tight fit among a firm's activities affects the firm's ability to react to environmental changes is presented. As part of the framework, a new classification scheme for environmental changes is developed. I argue that fit-conserving change, which leaves the internal fit among a firm's activities intact yet decreases the appropriateness of the set of choices as a whole, poses a particularly difficult challenge for managers. A longitudinal case study of the fashion apparel company Liz Claiborne illustrates the framework.