Inside-out and outside-in mental models: a top executive perspective

The purpose of this paper is to identify and characterise executives’ inside-out (firm-oriented) and outside-in (market-oriented) mental models. As these two orientations are vital for strategic decision-making, yet potentially contradictory, it is important to understand the role of inside-out and outside-in thinking in executives’ agendas.

Qualitative, semi-structured interviews of 15 senior executives were used to capture insights into executives’ mental models. Data analysis was conducted following the principles of abstraction, theory emerging from data and constant comparison.

Four archetypes of executive mental models are identified and characterised along two dimensions (inside-out or outside-in orientation and focus on rational or emotional aspects).

The study introduces a tentative framework for practitioners to identify and deploy the potential of the mental models that guide executive decision-making.

The study extends prior research on mental models by combining this approach with inside-out and outside-in orientations and customer value propositions. In addition, it introduces four archetypes that illustrate the distinct potential of different mental models.