Towards an Integrated View of the Ambidextrous Organization: A Second‐Order Factor Model

Within the context of ambidexterity, this paper focuses on the tension between radical and incremental innovation and its main aim is to investigate whether an ambidextrous organization for innovation can be conceptualized in a more integrated way as a second‐order construct reflected by both contextual and structural approaches. Structural equation modelling is employed to analyse data from a survey of 185 firms in Austrian and Italian medium‐ and high‐tech industries. The primary contribution of the paper is that the ambidextrous organization can be meaningfully described by a higher‐order structure made up of structural and contextual solutions. This paper makes an important contribution to ambidexterity thanks to high‐order modelling of the construct of ‘ambidextrous organization’, thus unveiling interesting implications for both academics and managers.     

Ties with government,strategic capability,and organizational ambidexterity: evidence from China’s information communication technology industry

Organizations that are capable of pursuing exploration and exploitative innovation strategies simultaneously have demonstrated superior performance. For information and communication technology (ICT) firms, it is especially critical to achieve such organizational ambidexterity in order to both allocate limited resources and pursue different innovation strategies appropriately. As the ICT industry in China faces higher environmental uncertainty, a less developed institutional framework, and increased power of market competition, we explore the antecedents of ambidexterity conjointly, considering the effects of institutions and organizational capabilities. Building on ambidexterity literature, we develop a capability-building framework to explore firms’ strategic choice-making between exploratory innovation strategy versus exploitation innovation strategy, and their orientation to pursuit one, or both. With survey data from China’s ICT industry, we find that ties with government promote an ambidextrous focus on both types of innovation strategies. In addition, we find that strategic capability partially mediates the main effects of ties with government on both exploratory and exploitative innovation strategies. Implications for organizational ambidexterity in China’s ICT industry are discussed.     

How Resource Challenges Can Improve Firm Innovation Performance: Identifying Coping Strategies

Researchers recently suggested that challenges in the form of adversities and constraints can actually promote individuals, teams and firms. However, it remains unclear how such challenges elicit positive innovation performance. Moreover, we still cannot distinguish between the conditions under which challenges enhance or hinder firm innovation performance. In this paper, we review the literature on coping with a specific and central type of challenge – resource challenge, such as a lack of financial or human resources – and propose an underlying mechanism through which firms can benefit from resource challenges. The paper presents an integrative conceptual framework and looks at the key constructs that explain the effects of resource challenges on firm innovation performance. Further, it proposes two key strategies for coping with resource challenges: simplification‐focus and compensation.     

Managing People to Promote Innovation

There is growing evidence available to suggest that Human Resource Management (HRM) practice is an important predictor of organizational performance. Drawing upon organizational learning perspectives, we argue that HRM systems also have the potential to promote organizational innovation. We present longitudinal data from thirty‐five UK manufacturing organizations to suggest that effective HRM systems – incorporating sophisticated approaches to recruitment and selection, induction, appraisal and training – predict organizational innovation in products and production technology. We further show that organizational innovation is enhanced where there is a supportive learning climate, and inhibited (for innovation in production processes) where there is a link between appraisal and remuneration.     

Resources,state ownership and innovation capability: Evidence from Chinese automakers

Promoting innovation has been a major task for both business practitioners and governments in emerging markets. Based on the resource‐based view, this study examines the contributing factors of firms' innovation capability and the contingent role of state ownership. Utilizing data on 102 Chinese automobile firms, we found that financial resources, R&D human capital, innovation leadership, collaborative culture, and government support positively relate to firms' innovation capability. Moreover, the firm's ownership type serves as a boundary condition for the resource–capability relationship. The significance of different resources in developing innovation capability vary for firms with different ownership types. In particular, government support and R&D human capital have stronger effects in promoting non‐state‐owned enterprises' innovation capability. From a practical standpoint, developing innovation capability should consider the critical role of ownership. Specifically, while state‐owned enterprises can capitalize on organizational and financial resources to enhance innovation capability, it is also important for them to transform bureaucratized systems into more market‐orientated ones and facilitate the effective utilization of R&D human capital and government support.     

The Organizational Innovation Laboratory

Organizational ‘innovation laboratories’, dedicated facilities for encouraging creative behaviours and supporting innovative projects, have received scant academic attention despite their increasing popularity with a range of different practitioners. This paper develops an initial theoretical explanation of the phenomenon, based upon notions of organizational learning and dynamic capabilities. This framework is then used as the basis for analysing the structure, infrastructure, benefits and dis‐benefits of three UK‐based laboratory facilities (mass service, government department, academic institution). Preliminary conclusions suggest that the ‘innovation laboratory’ can offer real benefits for organizations: reinforcing corporate commitment to innovation and creativity by providing a physical manifestation of dynamic capability and double‐loop learning concepts. Although the physical design of the space is central to its functionality – emphasizing dislocation from day‐to‐day activity, eliminating hierarchy, encouraging participation – direct facilitation remains critical to successful operation. There are also dis‐benefits associated with what can be substantial financial investments and there is some evidence that such facilities can have a relatively short useful lifespan. Given the limited nature of the empirical base, the paper concludes with some specific suggestions for further work.     

Teaching the Fuzzy Front End of Innovation: Experimenting with Team Learning and Cross‐Organizational Integration

How can the extremely uncertain front end of innovation – managing the fuzzy front end – be taught to graduate students? This paper describes and analyses experiments with experiential, problem‐based learning focused on the front end of innovation. The focus is on the learning and cross‐organizational integration of student teams; factors that have been identified as central to the success of teams involved in the front end of innovation. An experiential course, ‘From an idea to a business plan in product development’, was developed in conjunction with an actual company, and piloted with four student groups in 2007 and 2008. Data on this novel course were collected through participant observation, team self‐assessment and questionnaires. This paper reports favourable results for the effectiveness of the course design; it discusses the impact of team size and cross‐organizational team composition on team performance; and identifies the implications for teaching the front end of innovation.     

Supporting Innovation through HR Policy: Evidence from the UK

This paper focuses on the relationship between the importance of innovation for organizations and their human resources policy. Drawing on survey findings, we examine the coherence of organizations’ utilization of HR recruitment, training and performance management policies to support and enhance firms’ innovation performance. Through a social–psychological perspective, we situate our findings in two diverse areas: the psychological literature, exploring the measurement of innovation, and second, with regard to the internal (with each other) and external (with broader organizational objectives) integration of distinct HR policy elements. Our surveyed organizations indicate that, whilst attaching importance to innovation, they fail to consistently translate this importance into coherent HR policies. Typically, HR policy rewarded non‐managerial employees for innovation, whilst managerial staff were expected to do so as a matter of course. This inconsistency is one source of resistance which blocks the generation of new ideas, and their implementation, organization‐wide.     

The Early Bird Gets the Worm,But the Second Mouse Gets the Cheese: Non‐Technological Innovation in Creative Industries

In the context of economic turmoil, firms in the creative industries (CIs) must make fast decisions as to when to break through with innovations. This paper discusses non‐technological, organizational innovation of early‐adopters, first movers and early followers in order to overcome persistent economic decline, and the implication of different strategies for innovation success. The strategic principle of the pioneer's advantage rests on pre‐emption – the premise that ‘the early bird gets the worm’ and this often applies to business model innovation (BMI). ‘But the second mouse gets the cheese’ points at early followers who may have a more systematic, strategic approach towards innovation. Greater understanding of the advantages of each strategic approach and their significance for innovation performance is critical for CIs where unpredictability and the accelerating pace of change pervade the decisions concerning innovation. Drawing on five exemplary cases of archaeological firms in Spain, this paper explores different innovation process dynamics. The study develops a contingency model where pioneers who challenge their current business model, may be outperformed by early followers who incorporate complementary management innovation (MI) initiatives into the BMI.     

Performance implications of internet channels in financial services: A comprehensive perspective

Advances in information technology (IT) have forced financial services firms to explore new organizational forms and deliver service innovation. Given the obvious differences in the business model in which the financial services sector provides online services, it is natural to ask whether the emergence of Internet channels leads to superior achievement. Using a sample of twenty-four Taiwanese publicly traded financial services firms from 1997 to 2003, this empirical study attempts to assess the Internet channel??s effect on firm performance by means of applying event study methodology and data envelopment analysis. Results show that the magnitudes of average abnormal returns are uniformly positive and increase the operating efficiency of firms following announcements via Internet channels. This work therefore concludes that Internet channels have positive influences on firm performance.     

Synergies Between Organizational Learning and Creativity & Innovation

In today’s fast changing business environment, where knowing more and knowing it faster than the competition is often the difference between surviving and not surviving, organizational learning is more and more being recognized as a crucial organizational function. Never mind that the term is over-used, over-hyped and made to mean whatever the writer really wants to talk about. See through the snow and recognize that organizational learning is an organizational function that is here to stay and that will grow in importance. Unending changes in technology and in markets and the removal of logistical and regulatory buffers from competition will make it so. As a consequence of these facts, organizational learning has become a subject of study by management researchers and a subject of considerable interest to corporate leaders – so much so that many large US business organizations are creating positions with the titles like Chief Learning Officer and Chief Knowledge Officer. Certainly organizational learning is a phrase in high fashion. But in what specific ways, if any, does it lead to creativity and innovation? Or, consider the reverse directionality – in what ways do creativity and innovation lead to organizational learning? In this article, I offer some partial answers to these questions, with the intention of giving readers an additional way to frame the processes of creativity and innovation in their organizations.     

Establishing and managing a network for continuous innovation: Invoking organizational pressure

Social networks in organizations have been identified as important both in terms of increasing our understanding of innovation and for organizations to realize innovation outcomes. While previous studies have informed us of the importance of networks for innovation, we know little of how companies intentionally can design and utilize networks to achieve continuous innovation. The aim of this paper is to explore how a network for continuous innovation can be established and managed. A longitudinal case study has been performed using data covering the establishment and subsequent management of a network for supporting continuous innovation, spanning the product management and R&D department of a large multinational company. The results reveal the potential to use intra‐organizational networks to invoke organizational pressure conducive for making innovation happen. This pressure is induced by autonomy and self‐organizing in the network and consists of reciprocal expectations and demands between the top (management) and the bottom (employees involved in the network) of the organizational hierarchy. Implications for theory and practice are discussed.     

The Challenges of Using Design Thinking in Industry – Experiences from Five Large Firms

Design Thinking (DT) is advocated as a user‐centred approach to innovation, based on the way designers think and work. Despite being increasingly promoted as an approach to innovation, there is still little evidence of successful impact. Rather, indications suggest that firms find implementation challenging. The purpose of this paper is to analyse challenges of using DT in light of literature on innovation barriers, in order to discuss whether there is something unique about DT as a concept that makes it particularly challenging to use. The paper is based on an interview study of five large firms that all have at least five years of experience of using DT. The analysis shows that several of the perceived challenges can be linked to known barriers to innovation. However, other challenges have not previously been described in the innovation literature, and the paper suggests that there are some unique aspects of DT that makes it particularly challenging for firms to integrate it in innovation work. These are related to its core themes: user focus, problem framing, experimentation, visualization and diversity. Additionally, the paper contributes with an empirically based categorization of challenges that managers will find useful if they want to implement design thinking in their organizations.     

Facilitating Project Team Learning and Contributions to Organizational Knowledge

Innovative products, services, and processes are consequences of knowledge integration. Often the integration is of newly generated knowledge with other knowledge that the firm already has available. Especially in firms where long run performance depends on innovation, it behooves managers to think about how newly generated knowledge can be transferred quickly, effectively, and reliably, and thereby can be integrated with the firm’s current knowledge for early exploitation or captured as organizational knowledge in the form of practices, procedures, or files. New knowledge frequently originates in the context and activity of project teams – e.g., R&D teams, design teams, and re-engineering teams. In order to carry out their tasks, such teams frequently need to learn things already known to other organizational units, i.e., they need to acquire and assimilate organizational knowledge. Theoretically then, project teams both draw on the firm’s knowledge and contribute to the firm’s knowledge. The more effectively they carry out these actions, the more effective they are and the more effective their parent firms will be. This article identifies project team and organizational design practices that facilitate project team learning and contributions to organizational knowledge.     

Creating Ideas for Innovation: Effects of Organizational Distance on Knowledge Creation Processes

Innovation is to a large extent considered a social and communicative process, and input from other individuals potentially improves the generation of novel and valuable ideas also in the early stages of idea creation and development. Both colleagues inside organizations and external parties have frequently been proposed as important sources of information and knowledge within this part of the innovation process. Other contributions addressing social networks and innovation bring into focus the potentially negative effects that certain network structures may have on innovation, pointing to inconsistencies in received theory. In order to address these inconsistencies, an empirical study of ideation in a Swedish multinational firm was performed, taking into account two different knowledge creation processes – combination and in‐depth analysis – and their inter‐relationships with organizational distance between contributing individuals. Data was collected using a survey and was analysed using regression models. It was found that different levels of organizational distance correlate with different knowledge creation processes. In‐depth analysis occurred more often with employees' close colleagues, whereas the combination of existing ideas and information was more frequent in interaction with employees' close colleagues and with external parties. Both these interaction patterns were also found to be positive for the generation of patents, whereas no such relationship could be seen when individuals interacted with colleagues in other departments in the same firm. The findings have implications for theory on cognitive distance, and also suggest that management needs to facilitate different types of collaboration and networking when aiming to facilitate and support ideation, taking into consideration the type of innovation aimed for, as well as its supporting knowledge creation processes.     

Spaces for Creativity and Innovation in Two Established Organizations

Organizational work environments are increasingly strategically designed to support creativity and innovation processes, although a consistent theoretical frame for such an endeavour has not been developed yet. Creativity‐ and innovation‐oriented design of work environments requires an understanding of the principles of the underlying processes and their spatial implications. Both creativity and innovation processes are complex and display in different phases convergent and divergent characteristics. The processes are dependent on both individual and group effort. In this article these dimensions are discussed from a theoretical perspective and are used for evaluating the two cases presented here. The first case, the Interactive Creativity Landscape as integral part of the Fraunhofer Office Innovation Center in Germany has been designed interpreting the convergent and divergent phases of creative processes. The second case, the Learning Garden of a Scandinavian financial institution has been designed having de Bono's procedure in mind. The article concludes with the suggestion that increasingly organizations will offer diversity for spatially supporting creativity and innovation processes; solutions will be manifold but will follow certain principles – some of which are discussed here.     

Conceptualizing organizational innovation: The case of the Brazilian software industry

This paper presents and tests a conceptual model that explains the innovation practices and innovation outcomes in Brazilian software firms. In terms of internal and external innovation capabilities, the ability to manage the relationship between people and their organizational contexts plays an important role in organizational innovation. Based on these results, we propose that the disparities between software firms in building organizational innovation can be attributed, in part, to differences in their internal capabilities. The paper aims at encouraging and supporting managers to develop internal capabilities as a means of effectively leveraging the internally and externally distributed knowledge essential to innovation development.     

Building contextual ambidexterity in a software company to improve firm-level coordination

Software organizations increasingly face contradictory strategic choices as they develop customized and packaged solutions for the market. They need to improve efficiency of development processes while at the same time adapting to emerging customer needs; they need to exploit software products in relation to existing customers while simultaneously exploring new technology and market opportunities; and, they need to consider both incremental and radical innovations. While the integration of such opposing strategies requires software organizations to become ambidextrous, there is limited actionable advice on how managers can develop such capability. Against this backdrop, we report from a two-year action research study into a small software firm, TelSoft. Based on Pettigrew's contextualist inquiry, we develop a framework that integrates existing theory on contextual ambidexterity with a generic process for improving software organizations, and we apply this framework to analyze how TelSoft improved its coordination of products, projects, and innovation efforts. As a result, we offer principles for how software managers can build ambidextrous capability to improve firm-level coordination.     

Innovation Labs: An Examination into the Use of Physical Spaces to Enhance Organizational Creativity

Recent years have seen an increase in the number of innovation labs, purpose‐built physical facilities designed to enhance and support creativity and innovation in organizations. This rising phenomenon may be driven by the increasing emphasis placed on innovation as the key to the survival of modern day organizations. Innovation labs are attracting greater attention from organizations, yet little is known about their effectiveness. Using a mixed‐method approach this paper aims to evaluate the effectiveness of a major UK‐based facility in enhancing creativity and to explore users' attitudes towards this rising organizational phenomenon. The findings have implications for the management of existing innovation labs and those in the planning.