Innovation Adoption and Organizational Identity: Identity Dynamism as a Strategic Resource for Top Management Team Decision Making

Ryan  Raffaelli; Mary Ann  Glynn; Michael   Tushman

Working Paper | 2016

Innovation Adoption and Organizational Identity: Identity Dynamism as a Strategic Resource for Top Management Team Decision Making

by Ryan Raffaelli, Mary Ann Glynn and Michael Tushman

Abstract

Organizations continuously face decisions about whether to adopt radical innovations. We examine the relationship between innovation adoption and identity, linking identity with firm strategy to explain innovation adoption over time. We conceptualize identity as comprised of two related dimensions—"who we are" and "what we do"—that provide symbolic meaning and a strategic orientation, respectively. Our core argument is that the degree of coupling between these constituent elements of identity affects managerial perceptions of the relevance of an innovation to the firm, and in turn, their decision to adopt and successfully sustain radical innovations. The ability of senior executives to frame, manage, and adapt these two components enables the adoption of radical innovations. We advance a new theoretical construct, identity dynamism, which describes how processes of coupling and loosening "who we are" from "what we do" either enables or inhibits innovation adoption. We illustrate a range of conditions when organizational identity is an important dynamic capability. These ideas lead to a range of senior team implications that shape their firm's ability to adopt and/or shape product class evolution.

Keywords: dynamic managerial capabilities; organizational identity; innovation adoption; Mission and Purpose; Organizational Culture; Innovation and Invention; Adoption;

Language: English

Format: Print

Citation:

Raffaelli, Ryan, Mary Ann Glynn, and Michael Tushman. "Innovation Adoption and Organizational Identity: Identity Dynamism as a Strategic Resource for Top Management Team Decision Making." Working Paper, 2016.

This study examines how community-based brick-and-mortar retailers can achieve sustained market growth in the face of online and big box retail competition. The appearance of Amazon.com in 1995 led to a significant decline in the number of independent bookstores in the United States, leading many analysts to predict the demise of the sector. However, between 2009 and 2018 independent bookstores proved to be far more resilient than expected. The American Booksellers Association (ABA) reported a 49% percent growth in the number of “indie” booksellers, from 1,651 in 2009 to 2,470 in 2018. This study identifies several key factors that contributed to the independent bookstore resurgence: (1) COMMUNITY: Independent bookstore owners promoted the idea of consumers supporting their local communities by shopping at neighborhood businesses. (2) CURATION: Independent booksellers began to focus on curating inventory that allowed them to provide a more personal and specialized customer experience. (3) CONVENING: Independent booksellers started to promote their stores as intellectual centers for convening customers with likeminded interests—offering lectures, book signings, game nights, children’s story times, young adult reading groups, even birthday parties. Some bookstores routinely host over 500 events a year. Finally, the ABA played an important role in disseminating best practices and data, reinforcing the sector’s core values, setting up external partnerships, and advocating on behalf of its independent bookstore members.

Article | Strategy & Leadership | 2019

Overcoming Cultural Resistance to Open Source Innovation

John Winsor, Jin Hyun Paik, Michael Tushman and Karim R. Lakhani

Purpose: This article offers insight on how to effectively help incumbent organizations prepare for global business shifts to open source and digital business models.
Design/methodology/approach: Discussion related to observation, experience and case studies related to incumbent organizations and their efforts to adopt open source models and business tools.
Findings: Companies that let their old culture reject the new risk becoming obsolete if doing so inhibits their rethinking of their future using powerful tools like crowdsourcing, blockchain, customer experience-based connections, integrating workflows with artificial intelligence (AI), automated technologies and digital business platforms. These new ways of working affect how and where work is done, access to information, an organization’s capacity for work and its efficiency. As important as technological proficiency is, managing the cultural shift required to embrace transformative industry architecture – the key to innovating new business models -- may be the bigger challenge.
Research limitations/implications: Findings are based on original research and case studies. Insights are theoretically, based on additional study, interviews, and research, but need to be tested through additional case studies.
Practical implications: The goal is to make the transition more productive and less traumatic for incumbent firms by providing a language and tested methods to help senior leaders use innovative technologies to build on their core even as they explore new business models.
Social implications: This article provides insights that will lead to more effective ideas for helping organizations adapt.
Originality/value: This article is based on original research and case experience. That research and experience has then been analyzed and viewed through the lens of models that have been known to work. The result is original insights and findings that can be applied in new ways to further adoption within incumbent organizations.

Keywords: open source innovation; Organizational Culture; Organizational Change and Adaptation; Business Model; Technological Innovation; Collaborative Innovation and Invention;

Citation:

Winsor, John, Jin Hyun Paik, Michael Tushman, and Karim R. Lakhani. "Overcoming Cultural Resistance to Open Source Innovation." Strategy & Leadership 47, no. 6 (2019): 28–33. View Details

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In 1983, 14 years after the introduction of the battery-powered quartz watch, mechanical watches and the Swiss watchmakers who built them were predicted to be obsolete (Landes, 1983). Unexpectedly, however, by 2008 the Swiss mechanical watchmaking industry had rematerialized to become the world’s leading exporter (in monetary value) of watches. This study reveals the process and mechanisms associated with technology reemergence, i.e., the resurgence of substantive and sustained demand for an old (legacy) technology following the introduction of a new dominant design. Drawing on the case of mechanical watchmaking, it reveals how technology reemergence is a decidedly cognitive process, unfolding in two phases: a first phase marked by a redefinition of the meanings and values associated with the legacy technology and facilitated by mechanisms of value recombining, temporal distancing, identity marking, and conceptual bridging and a second phase marked by a redefinition of market boundaries and facilitated by mechanisms of competitive set reclaiming and enthusiast consumer mobilizing. For mechanical watchmakers, the process culminated in competitive and consumer differentiation that ushered in innovation reinvestment and a period of substantive and sustained demand growth for mechanical watches. This paper contributes to research on technology cycles, cognition, and incumbent responses to discontinuous change.

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Innovation Adoption and Organizational Identity: Identity Dynamism as a Strategic Resource for Top Management Team Decision Making

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