The Role of External Involvement in the Creation of Management Innovations

Abstract

Abstract:There has recently been renewed scholarly interest in management innovating, the creation of new organizational practices, structures, processes and techniques. We suggest that external involvement in the process of management innovating can transpire in three different ways: direct input from external change agents; prior external experience of internal change agents; and the use of external knowledge sources by internal change agents. We ask whether the type of innovation created (radical or not; systemic or not) depends on the use of these three forms of involvement and whether the forms are substitutes or complements. We empirically investigate this through an archival study of 23 major historical innovations, using in-depth data from a large number of sources in the academic literature. We use three complementary methods of analysis: Unstructured qualitative observations, correlational analysis and crisp set qualitative comparative analysis. We find that the presence of external change agents is associated with systemic and incremental innovations; that the absence of external experience is associated with systemic and radical innovations; and that the presence of external sources of knowledge has no clear effect. Furthermore the three forms of involvement act to a large degree as substitutes. We contribute new theoretical arguments for the 1 facilitators of management innovation, demonstrate the usefulness of an open innovation lens to the study of management innovation, show that management innovating is a relatively complex form of strategic process and highlight how the creation of management innovations is similar to and different from the genesis of other types of innovation. 2 An important domain in organization studies concerns innovation in the nature of the practices used to manage organizations. This has often been framed as management innovation and is a topic that has long attracted scholarly and practical attention (Abrahamson, 1991;Damanpour and Evan, 1984;Kaplan, 1998;Stata, 1989;Volberda, Van Den Bosch and Heij, 2013). In a broad sense the study of management innovation allows scholars to map progress (or its absence) in how organizations are managed, and to track efforts by organizations to improve their effectiveness over time. Recently, there has been a resurgence in work in this area (Damanpour, Walker and Avellaneda, 2009; Foss, Pedersen, Pyndt, and Schulz, 2012;Vaccaro, Jansen, Van Den Bosch and Volberda, 2012), probably best exemplified through the work of Birkinshaw, Hamel, and Mol (2008) who developed new insights into the process of management innovation, arguing that it is driven by the work of internal and external change agents who grapple with specific organizational and environmental contexts. For the purposes of this paper, we follow the definition of management innovation suggested by Birkinshaw et al (2008: 825): "the invention and implementation of a management practice, process, structure or technique that is new to the state of the art and is intended to furthe...

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