Ter Wal: the Innovative Firm

The Innovative Firm

Norwegian Business School (BI) May 22-24, 2017

The study of innovation is a key pillar of management research. Innovation is seen as a major source of organizational competitive advantage and an important driver of economic growth. Governments have increasingly turned to innovation as a key mechanism to enable and support economic development, developing policies to support and shape the innovative efforts of firms, universities and other organizations.

Dr ter Wal’s component of the course will offer a thorough theoretical understanding of three key themes of innovation research. The learning objectives of the sessions are as follows:  Understand the foundations of the innovation concept.  Develop an overview of key themes in the innovation management literature and appreciate the frontier of research in these themes.  Theorize about the antecedents and effects of innovation.  Gain insight into the contingencies of innovation: the conditions that enable or constrain innovation processes.  Apply innovation theories to research into organizational managerial challenges.

In the first session, we will look at the antecedents of innovation at the individual level: creativity. Creative individuals are the cornerstone of the innovative firm. The class discussion will focus on where creativity comes from and what firms can do to foster and leverage the creativity of their staff for the development of innovations.

In the second session, we will then shift to the firm level. Increasingly, firms engage in open innovation practices designed to capitalize on using external knowledge for internal innovation. We will discuss how firms learn new knowledge, zooming in onto the role of external inputs.

In the third and final session, we take the meso-level perspective of networks. Both individuals and firms seek to leverage their embeddedness in communication and collaboration networks to generate and implement innovation. The class discussion will focus on how the structure of inter- and intra-firm networks helps or constrains the innovation process.

All three sessions are designed to prepare students to engage with fundamental debates in innovation research, to take stock of the state-of-the-art of the literature, and to formulate directions how the field may be further advanced. Ter Wal: The Innovative Firm

NOTE ON THE READINGS AND COURSE PREPARATION

Over the course of three sessions we will discuss academic papers in relation to three core themes in innovation management research. These sessions seek to inform you of the main ideas and research challenges in the study of innovation, drawing together some of the key readings on the nature of the innovation process and helping to provide an overview of this rich and evolving literature. Each session combines a small number of classic papers with more recent examples of the scholarly work emerging from this tradition.

The sessions are organised as a facilitated reading group. In each session, we will review and discuss six or seven milestone articles in the field. There are no formal presentations and students are expected to read all of the papers, and to be prepared to discuss them during the class session.

 The discussion will cover the following issues:  What is the main idea?  What is the gap that the article addresses?  What previous ideas does it build on?  What is its main theoretical contribution?  What is the underlying theoretical logic, the core argument?  How does this article advance thinking in innovation in your opinion?  How has this article influenced the work of others?

The value of the seminar is in its discussion. Although I will be present as a facilitator in each session, the role of the facilitator is not to lecture to you, but rather ask questions. You should be prepared to discuss each article, assess its contribution, understand its logic and have an opinion of its contribution to research in innovation management. All articles will be assigned to a student who will summarize for the benefit of the class. This one-page summary should explain the research idea and context, assess theoretical and/or empirical evidence, and examine the impact of the paper. The summaries should be emailed to me by 6 pm the day before the session and will be shared with the whole group after class.

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ABOUT THE PROFESSOR

Anne ter Wal joined Imperial College Business School in 2009 and is Assistant Professor in the Department of Innovation and Entrepreneurship. His research, often in collaboration with leading multinational companies, focuses on the management of Research and Development.

An important theme in his research is the management of creativity. A question he addresses is how managers can strike the balance between providing R&D scientists and engineers with sufficient autonomy to allow them to try something new and exercising control to ensure their efforts align with business objectives.

Anne’s research also focuses on the role of networks in the innovation process. For example, he studies how individuals access new knowledge and ideas through networks within and between organizations and the challenges they face when seeking to apply these ideas into the creation of novel products and services.

Prior to joining Imperial College, Anne was a doctoral researcher at the Section of Economic Geography at Utrecht University. His doctoral thesis analysed under which conditions collaboration networks in geographical clusters emerge.

His work has been published in leading journals in geography, innovation studies and management, including the Administrative Science Quarterly, Organization Science, Research Policy, the California Management Review, the Journal of Product Innovation Management, the Journal of Economic Geography and Economic Geography.

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Session 1: Creativity and the Innovative Firm

Managing creativity is a daunting task. At an early stage it is difficult to distinguish unconventional, yet promising ideas from ones that are downright foolish. In this session we will discuss how you firms can manage creative processes. We will look at what makes creative work different from other types of work and discuss the implications this has for effective management of creativity in innovative firms.

Readings:

1. Amabile, T. (1988). A model of creativity and innovation in organizations. Research in Organizational Behavior 10: 123-167. 2. Kanter, R.M. (2000). When a thousand flowers bloom: Structural, collective, and social conditions for innovation. In: R. Swedberg (ed.), Entrepreneurship: The social science view. Oxford: Oxford University Press. 3. Dougherty, D. (1992). Interpretive barriers to successful product innovation in large firms. Organization Science 3(2): 179-202. 4. Oldham, G.R. and A. Cummings (1996). Employee creativity: Personal and contextual factors at work. Academy of Management Journal 39 (3): 607-634. 5. Howell, J. and Higgins C. (1990). Champions of technological innovation. Administrative Science Quarterly 35 (2): 317-341. 6. Criscuolo, P., A. Salter & A.L.J. Ter Wal (2014). Going underground: Bootlegging and individual innovative performance. Organization Science 25 (5): 1287-1305.

Session 2: Open Innovation and the Innovative Firm

Firms increasingly realize the potential of open innovation and attempt to tap into the pool of knowledge and ideas that exists outside the company. In this session we will discuss how firms learn based on external knowledge. The session also covers the challenges that typically arise in open innovation settings and what firms can do to tackle these.

Readings:

1. Cohen, W. M. and D. A. Levinthal (1990). Absorptive capacity: A new perspective on learning and innovation. Administrative Science Quarterly 35: 128-152. 2. Zahra, S. A. and G. George (2002). Absorptive capacity: A review, reconceptualization, and extension. Academy of Management Review 27(2): 185-203. 3. March, J. (1991), Exploration and exploitation in organizational learning. Organization Science 2 (1): 71-87. 4. Katila, R. and G. Ahuja (2002). "Something old, Something new: A longitudinal study of search behavior and new product introduction." Academy of Management Journal 45(8): 1183-1194. 5. Laursen, K. and A. Salter (2006). Open for innovation: The role of openness in explaining innovation performance among UK manufacturing firms. Strategic Management Journal 27: 131-150. 6. Salter, A., P. Criscuolo and A.L.J. Ter Wal (2014). Coping with open innovation: responding to the challenges of external engagement in R&D. California Management Review 56 (2): 77-94.

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7. Ter Wal, A.L.J, P. Criscuolo and A. Salter (2017). Making a marriage of materials: the role of gatekeepers and shepherds in the absorption of external knowledge and innovation performance. Research Policy, forthcoming.

Session 3: Networks and the Innovative Firm

The third session will be about the role of networks within and between organizations. The creation of new ideas in organizations crucially depends on the structure in which employees interact. For example, in professional services firms such as consultancy firms, employees frequently seek advice from one another to find solutions to the problems they encounter in their work. In this session we will discuss on networks matter for innovative firms and how dwell on the question how firms can try and influence the communication in their organization in an attempt for foster the generation and implementation of new ideas.

Readings:

1. Perry-Smith, J.E. and C.E. Shalley (2003). The social side of creativity: a static and dynamic social network perspective. Academy of Management Review 28 (1): 89-106. 2. Powell, W. W., K. W. Koput, et al. (1996). Interorganizational collaboration and the locus of innovation: Networks of learning in biotechnology. Administrative Science Quarterly 41: 116-145. 3. Burt, R. S. (2004). Structural holes and good ideas. American Journal of Sociology 110(2): 349-399. 4. Ahuja, G. (2000). Collaboration networks, structural holes and innovation: a longitudinal study. Administrative Science Quarterly 45: 425-455. 5. Hargadon, A. and Sutton R. (1997) Technology brokering and innovation in a product development firm Administrative Science Quarterly 42 (4): 716-749. 6. Fleming, L., S. Mingo and D. Chen (2007). Collaborative brokerage, generative creativity, and creative success. Administrative Science Quarterly 52: 443-475. 7. Ter Wal, A.L.J., Alexy, O., Block, J., and Sandner, P., “The best of both worlds: the benefits of open-specialized and closed-diverse syndication networks for ventures’ success. Administrative Science Quarterly 61 (2016) 393-432.