The Importance of Management Innovation (original) (raw)
Ambidexterity as a Solution for the Challenge of Organizing Innovation
Organisations are facing the dilemma on how to innovate. To pursue exploratory and exploitative activities simultaneously, firms must choose from two different approaches to ambidexterity: creating a different unit within the organisation or embedding the innovation through the firm. After having researched in different size and sector companies, we have found that large firms tend to organize innovation through a separate unit whilst small-medium size firms prefer to embed innovation in the firm. Our research also shows that the selected approach will vary according to the sector: industrial firms prefer to set up a different unit, technological firms prefer embedding innovation in the organization and financial firms are changing from one model to the other without a clear tendency.
THE AMBIDEXTROUS ORGANIZATION IN PRACTICE: BARRIERS TO INNOVATION WITHIN RESEARCH AND DEVELOPMENT
Academy of …, 2008
Research and development activities need an ambidextrous organization as they are both, explorative and exploitative. Building on multiple case studies, we are able to identify the specific challenges of different organizational forms to support ambidexterity by applying a barriers approach to innovation. We discuss possible underlying reasons for these challenges and suggest solutions based on different roles in innovation management.
Innovation through Ambidexterity: How to Achieve the Ambidextrous Organization Constantinos Markides
It has long been recognized in the literature that the pursuit of radical or disruptive innovation by established firms poses an organizational challenge for the firm. This is because the skills, structures, processes and mindsets required for exploiting the existing business are fundamentally different and often conflict with those required for radical innovation (i.e. exploration). This has led researchers to propose the need for "ambidextrous" organizations-companies capable of achieving efficiency in their existing business while at the same time having the strategic foresight to innovate and explore new businesses. Past research has found some support for a positive relationship between performance and the ability to be ambidextrous. There is, however, little evidence on how a firm can actually achieve ambidexterity. In this paper, we explore the issue of ambidexterity in the context of diversified firms. Specifically, we examine diversified firms that need to manage divisions that face conflicting demands for integration and responsiveness. Not all divisions of a diversified firm face such conflicting demands, so we focus on only those divisions that do. These divisions must be given autonomy to be locally responsive but must also be centrally controlled to allow for the efficient exploitation of interdependencies with the parent (and other divisions in the diversified firm). We use theory to propose ways by which a diversified firm could achieve such ambidexterity in its handling of these divisions. We then utilize questionnaire data from the 100 biggest business Groups in Taiwan to empirically test our hypotheses. We find that granting operational autonomy to separate divisions while centralizing strategic and financial controls promotes the achievement of ambidexterity. We also find that ambidexterity could be promoted through the use of strong values, rotation of managers and internal training programs.
Innovation Streams and Ambidextrous Organizational Designs: On Building Dynamic Capabilities
2004
This article empirically explores the relations between alternative organizational designs and a firm's ability to explore as well as exploit. We operationalize exploitation and exploration in terms of innovation streams; incremental innovation in existing products as well as architectural and/or discontinuous innovation. Based on in-depth, longitudinal data on 13 business units and 22 innovations, we describe the consequences of organization design choices on innovation outcomes as well as the ongoing performance of existing products. We find that ambidextrous organization designs are relatively more effective in executing innovation streams than functional, cross-functional, and spinout designs. Further, transitions to ambidextrous designs are associated with increased innovation outcomes, while shifts away from ambidextrous designs are associated with decreased innovation outcomes. We describe the nature of ambidextrous organizational designs-their characteristics, underlying processes, and boundary conditions. More broadly, we suggest that the locus of integration and degree of structural differentiation together affect a firm's ability to explore and exploit. We suggest that the senior team's ability to attend to and deal with contradictory internal architectures is a crucial determinant of a firm's ability to exploit in the short term and explore over time.
The purpose of this work is to discuss the issue of how companies aiming to increase their innovative capacity should decide about their organizational structure. To accomplish this goal, a bibliographic review about the theme was carried out, as well as an exploratory research, conducted by case study in a Brazilian petrochemical company that had recently re-organised its structure regarding innovative activities. The results suggest that the studied company decided upon its organisational structure without considering the whole process of innovation, focusing efforts only on the Research and Development area. Its organizational structure is still based on traditional forms, with centralized decisions and well demarcated functions. A more "adhocratic" structure, considering innovation as an integrated process would foster the company innovative capacity in the future.
A Dialectic Perspective on Innovation: Conflicting Demands, Multiple Pathways, and Ambidexterity
Industrial and Organizational Psychology, 2009
Innovation, the development and intentional introduction of new and useful ideas by individuals, teams, and organizations, lies at the heart of human adaptation. Decades of research in different disciplines and at different organizational levels have produced a wealth of knowledge about how innovation emerges and the factors that facilitate and inhibit innovation. We propose that this knowledge needs integration. In an initial step toward this goal, we apply a dialectic perspective on innovation to overcome limitations of dichotomous reasoning and to gain a more valid account of innovation. We point out that individuals, teams, and organizations need to self-regulate and manage conflicting demands of innovation and that multiple pathways can lead to idea generation and innovation. By scrutinizing the current use of the concept of organizational ambidexterity and extending it to individuals and teams, we develop a framework to help guide and facilitate future research and practice. Readers expecting specific and universal prescriptions of how to innovate will be disappointed as current research does not allow such inferences. Rather, we think innovation research should focus on developing and testing principles of innovation management in addition to developing decision aids for organizational practice. To this end, we put forward key propositions and action principles of innovation management.
Organizational Structure and Innovation
NHRD Network journal, 2012
The economic environment in India over the past couple of decades compelled a shift in the business strategies of most business organizations, from a market push, to a market-pull based strategy. While earlier demand was high and supply scarce, the reversal of the trend to a high-supply-lower-demand situation, has led to a competitive environment, posing considerable challenges to business organizations. Faced with escalating customer expectations, organizations have had to go back to their drawing boards to analyse how to adjust quickly and adopt new ways to remain competitive. The view is clear: firms need to design structure, strategy and systems to instill a culture of innovation to compete and perform in the market place. The Concept and Importance of Innovation T he concept of innovation has a long history and has taken different meanings, depending on different strategies used to compete in the marketplace. Since 1950, different approaches of competing in the marketplace have been used, such as the efficiency approach (e.g. lean management), the quality movement (e.g. quality circles and standards), flexibility, and finally, innovativeness (Bolwijn and Kumpe, 1998). Innovation covers the entire gamut of processes-from the generation of the first idea to the introduction of a product or service into the market. Functional alignment between R&D, Production and Marketing is the key to the innovation of organizations.