EDITORIAL
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Editorial
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n this first issue of the 17th volume of Creativity and Innovation Management, quite divergent perspectives on creativity and innovation management are represented in all eight articles. In addition to these both theoretically and practically relevant and inspiring contributions, we intend to support you by supplying information on events from within our CIM community as well as from related networks. With respect to our CIM community, we wish to further strengthen this community by the 2nd Creativity and Innovation Management Community meeting to be held in Buffalo, 28–30 May 2008. This community meeting on Creative Leadership is hosted by Gerard Puccio and his colleagues. We, together with our founding editors Tudor Rickards and Susan Moger, hope to meet many of you in Buffalo. You will find the program of that event on our website. The first six articles of this first 2008 issue are not specifically clustered. The last two articles are brought together by our guest editors and members of the editorial board, Ming-Huei Chen and Geir Kaufmann. These articles are presented as a mini special, based on presentations from the 2006 R&D Management conference on Creativity and R&D, held in Taiwan. Iván Orosa Paleo and Nachoem Wijnberg start this issue by formulating an important question in the field of creativity and innovation management: ‘How to understand and measure the output innovativeness of an organization?’ The authors characterize their contribution as a theoretical exploration, illustrated by a particular case study concerning the Noorderslag Festival, one of the betterestablished popular music festivals in the Dutch music industry. In their theoretical exploration and methodology two indicators of innovativeness are constructed: the ‘referent innovativeness index’ and the ‘classification innovativeness index’. A second contribution is about ‘Innovation intermediaries: why internet marketplaces for technology have not yet met the expectations’ by Ulrich Lichtenthaler and Holger Ernst. The authors interviewed intellectual property and technology managers in 25 medium-sized and large industrial companies, who represent the potential licensees and licensors in the internet © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
exchanges. The results of this research show relatively limited success rates of internet marketplaces regarding the number of technology transactions. Jan Kratzer and Christopher Lettl report in their contribution an empirical study among children on ‘a social network perspective of lead users and creativity’. This study, guided by lead user theory, creativity research, and network theory, investigates 16 classes of children examining the relationship between the children’s social networks and their resulting creativity and lead userness. The main result is that children who are positioned as bridging links between different groups in social networks reveal both a high degree of lead userness and a high level of creativity. The fourth article ‘Creative potential and practised creativity: identifying untapped creativity in organizations’ by Trudy DiLiello and Jeffery Houghton concerns the construct validity of ‘creativity potential’ (i.e. creative capacity, skills and abilities that the individual possesses) and ‘practised creativity’ (i.e. perceived opportunity to utilize creativity skills and abilities on the job). Data for this study were collected within one strategic command of the US Department of Defense, utilizing a web-based survey. The results suggest that by cultivating environments that support creativity, modern organizations may be able to tap into heretofore idle creative potential. Alexander Styhre and Michael Eriksson report insights from a Swedish project, Artists in Residence (AIRIS), wherein artists (musicians, painters, actors, dancers and choreographers) collaborated with a regular company, with the aim of helping the co-workers think in new and creative terms. Although the effects were limited, the project shows that there is a great potential in bringing artists into industry. The sixth contribution ‘Exploring the effect of cognitive biases on customer support services’ is written by Heiko Gebauer, Regine Krempl and Elgar Fleisch. These authors argue that product-oriented firms on the one hand have a growing interest in extending and innovating their customer support service, and on the other hand experience a lot of difficulties in realizing this successfully. In this article four cognitive biases of managers are elaborated
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through 12 mini-cases and 8 in-depth cases: disbelief in the financial potential, risk aversion, tendency to set over-ambitious objectives, and fundamental attribution error. The R&D Management Conference Taiwan was held during 8–11 November 2006, and was sponsored by Creativity and Innovation Management. Our editorial board members Ming-Huei Chen and Geir Kaufmann, inspired by the discussions and papers presented at the event, wrote up a critical review on Employee’s Creativity and R&D for CIM, which also serves as a theoretical introduction to the ‘practitioner’s insight’ presented in Taiwan by Steve Boehlke, included in this mini special. Boehlke’s article is entitled ‘The politics of creativity: Four domains for inquiry and action by leaders in R&D’. He takes a practitioner’s view to examine the politics in facilitating creativity in an organization based on a so-called ‘under the radar’ workshop which includes more than 200 leaders, managers of scientists and engineers in R&D over the past four years. Four domains of action were identified to motivate professionals in R&D fields, namely (1) pacing productivity, (2) learning from failure, (3) managing connections, and (4) paying the price. This paper makes a relevant contribution for practitioners to stimulate creativity in R&D fields. After the mini special, Olaf Fisscher reviews the book Creative Leadership, Skills that drive Change, recently written by Gerard Puccio, Mary Murdock and Marie Mance. The title of this book fits coincidentally very well with the title ‘Creative Leadership’ of the CIM com-
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munity meeting as mentioned above. Lisete Barlach reviews the new edition of the book Cultures of Creativity, edited by Ulf Larsson, containing an overview and analysis of the creativity of Nobel Prize laureates. An honourable event we would like to draw your attention to regards the Leermeester Award, recently received by Jan Buijs. To underline the contribution of Jan Buijs to the field of creativity and innovation management, we offer free access to three of the articles he published in CIM. As usual, at the end of the issue you may find current calls for papers. This issue includes invitations to participate and contribute to the Workshop on Creative Leadership, Buffalo, USA, 28–30 May 2008. In addition, calls for other conferences are included as well. As already mentioned in the editorial of the previous issue, Klaasjan Visscher has joined the editorial team. Klaasjan is a lecturer and researcher in the field of organization studies, design methodology and innovation management. He works at the University of Twente and is a close colleague of Olaf, Petra, and Jeannette. Before joining the editorial team, he has been an advisor and regular reviewer for CIM. We wish you a good reading of this issue, and, we hope to meet you in Buffalo! January 2008 Olaf Fisscher Petra de Weerd-Nederhof Klaasjan Visscher
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Organizational Output Innovativeness: A Theoretical Exploration, Illustrated by a Case of a Popular Music Festival Iván Orosa Paleo and Nachoem M. Wijnberg Different interpretations of innovation and innovativeness lead to different approaches and different methods to measure organizational output innovativeness. Two indicators of innovativeness are derived from two divergent approaches: the Referent Innovativeness Index and the Classification Innovativeness Index. The article uses the case of the popular music festival to discuss how these indexes can be operationalized and calculated, as well as to outline the implications of the differences between the methods.
Introduction
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s it possible to say that one organization is more innovative than another? Or that an organization has become more innovative than it was five years earlier? This study analyses the theory on which such statements could be based and proposes ways to make the actual measurements. The innovativeness of an organization usually refers to the innovative performance of an organization as a whole in a particular time period, usually a year, and usually with regard to its output of goods and services. As will be discussed below, although it is also possible to speak about the innovative performance of an organization with regard to how innovative its processes and possibly organizational structure is, the focus of this paper will be on innovative output. To stress this point we will be using the term ‘organizational output innovativeness’ to denote precisely what we are discussing. Arguments highlighting the innovative performance of organizations are especially significant for organizations in industries where being perceived as innovative has become an important and sometimes dominant determinant of the value of products and producers (Wijnberg & Gemser, 2000). Notwithstanding this interest in organizational innovativeness with respect to output, the concept has rarely been given systematic attention. The main © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
purpose of this paper is to show how different ways to understand innovation lead to different ways to understand organizational output innovativeness. These ways range from focusing on the extent of the novelty to the focal organization and competitive actors (e.g., Kleinschmidt & Cooper, 1991), to looking at changes in existing classification systems, directly or indirectly brought about by individual innovations (e.g., Wijnberg, 2004), We will explore how these different ways can be operationalized to measure organizational output innovativeness in accordance with particular theoretical perspectives. We will illustrate our proposals for the construction and operationalization of indices of innovativeness by looking at one particular case, that of a popular music festival, considered as an organization producing an event consisting of a series of musical performances (Orosa Paleo & Wijnberg, 2006). The product or output of the festival can be described as the line-up or programme of the festival in a particular year, containing many different artists. The structure of the paper is as follows. First, we review the literature on artistic innovation, in both the high art and the popular realms. Second, we explore the economic and organizational science literature, regarding different conceptualizations of innovativeness, to show how different ways of understanding product innovation and innovativeness – in the
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sense of the importance of an innovation – can result in different ways of understanding innovativeness. Third, we will present the data and methodology that will be used in our empirical analysis. Fourth, the empirical results will be presented. Finally, conclusions will round off the paper.
Innovativeness and Innovation The concept of innovativeness has been used in two rather different ways: to describe an innovation and to describe an organization. On the one hand, it denotes the magnitude or importance of the innovation (Kleinschmidt & Cooper, 1991; Garcia & Calantone, 2001; Brockman & Morgan, 2003). On the other hand, it has also been used to describe an organization’s capacity to innovate (Woodside, 2004; Hurley, Hult & Knight, 2005), and thus a precursor to innovative performance. In this sense, innovativeness is treated as a cultural precursor that provides the social capital to facilitate innovative behaviour, and subsequently considered as a central aspect to understanding how to create innovative and adaptive organizations (Hurley, Hult & Knight, 2005). Innovativeness relates to a series of individual and group level properties that are characteristics of individual and group idea generation, learning, creativity and change. In this vein, innovativeness reflects the potential of organizations to produce innovative products: the extent to which the organizational structure of a firm could influence its capacity to release an innovative product into the market. As stated in the introduction, the purpose of this paper is to look at the aggregate measure of the innovative performance of an organization in a given period, which we indicate by the term organizational output innovativeness. To do so we have to return to the first meaning of the term innovativeness, the importance of an innovation. All authors agree on at least one point: innovation implies novelty (Schumpeter, 1942; Daneels & Kleinschmidt, 2001; Garcia & Calantone, 2001; Wijnberg, 2004). The degree of innovativeness of a particular innovation has to do with how new it is, in an ex post sense. However, the consensus stops there, before answering the question, which is often not even asked explicitly: new to whom? Precisely by asking this question, it is possible to distinguish several different approaches to the determination of the importance of innovation. We have chosen to focus on two of them. According to the first, novelty of a product is determined by the extent to which it is new to larger groups of competitors, starting
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with the focal firm itself (Kleinschmidt & Cooper, 1991). Subsequently, product innovations can be classified according to their novelty-to-the-firm, novelty-to-the-industry and novelty-to-the-world, and deemed as highly innovative, moderately innovative and ‘low’ innovative. In a survey performed by Kleinknecht, Reijnen and Verweij (1990), firms were asked to self-evaluate the innovations they had performed on a scale ranging from ‘new to the firm’, along ‘new for the Dutch industry’, to ‘new for the world’. In their analysis of art organizations, Castañer and Campos (2002) argue along similar lines with regard to one dimension of product innovativeness, namely the referent, which can be self (the focal organization’s own past), or local (all other organizations in the local field, usually the country) or cosmopolitan (all other organizations in the field around the world). In all these cases, the importance of a product innovation depends on the size of the group of competitors – ranging from the focal firm itself to the whole world – to which the product is new. An alternative approach can be distinguished in which the focus is not on the innovation’s novelty to the referent but on the innovation’s impact on the competitive environment. Studies in which different dimensions are defined, e.g., production and market (Abernathy & Clark, 1985) or technological and commercial (Garcia & Calantone, 2001; Daneels & Kleinschmidt, 2001), can be seen as steps towards such an approach. Something which is new, as seen from different perspectives at the same time, scores highest on innovativeness. This approach can be extended not only by taking into account different constituencies and dimensions, but also by attempting to consider the economic environment into which the innovation is introduced as a whole. The selection systems framework (Debackere et al., 1994; Wijnberg & Gemser, 2000; Wijnberg, 2004; Priem, 2007) describes competition in terms of interactions in a market between producers, consumers and selectors. The selectors, who may be consumers, producers or experts, ultimately determine the value of products and the outcome of the competitive processes in the industry/market dominated by a particular selection system. Something is more innovative if it is recognized as more innovative to the relevant selectors in the relevant selection system. This means that each of the dimensions, as distinguished for instance by Garcia and Calantone (2001), can be significant, but only when it is crucial for the relevant selectors. If the selectors are consumers, the dimension of new to market will be most important; if the selectors are technical experts the dimension of new from a technological © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
ORGANIZATIONAL OUTPUT INNOVATIVENESS
perspective will be dominant. The more innovative a product is, the greater will be its impact on competitive dynamics, precisely because of the innovation’s impact on the decision-making processes of selectors. Competitive dynamics are hard to measure directly. However, it can be argued that the classification scheme used by relevant selectors to categorize products in the industry will reflect the preferences of selectors, and therefore that the competitive dynamics can be observed by studying classificatory dynamics. Classification systems serve as vehicles to categorize innovations by indicating differences and similarities with existing categories, facilitating the cognition of new products and allowing its comparison with existing and/or new, competing products (DiMaggio, 1987). Thus, innovations can be detected by looking at the emergence of new categories or genres (see, for instance, Mezias & Mezias, 2000). If a product can be easily classified in a longstanding and stable category, it will not be considered to be very innovative. In contrast, if a product is different enough to be among the first to occupy new (sub)categories or even result in the creation of a new (sub)category, it will score high on innovativeness. Ultimately, highly innovative products could potentially bring about changes in the very composition of the selection system itself, as changes will occur not only in the extant classification scheme, but also, importantly, in the set of relevant selectors in the industry (Wijnberg, 2004). Summarizing, the preceding discussion of product innovation and how to determine the importance of the innovation provides the necessary foundation for the construction of two different measures of organizational output innovativeness. On the one hand, the extent of novelty of products can be determined by finding out whether the product is new to wider cycles of referents: the focal firm, the industry, etc. On the other hand, it can be measured by assessing the impact on competitive dynamics as evidenced by how the products are classified and their resulting impact on the dynamics of the classification system. In the empirical part of this study, we operationalize both approaches and compare the results. Before we do so, we will take a brief look at the music industry and music festivals, the subject of the case to which we will apply the operationalizations.
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major source of transformation of market structures and competitive dynamics. Hirsch (1972) and Caves (2000) stress the high degree of uncertainty regarding the evaluation of the quality of musical products, resulting in an enhanced importance of certification processes and demand–supply intermediation. Additionally, the music industry is a field in which being considered innovative is often a powerful sales argument for competing products or producers (Wijnberg & Gemser, 2000). This is particularly true in the highly competitive music festival sub-industry: innovativeness of participating artists is an important criterion to a festival’s line-up programmers, who aim to attract the attention of audiences and of other incumbents in the industry. The perceived innovativeness of music festivals can boost their credibility as certifiers of the innovativeness of artists – the fact that artist A performed at the highly innovative festival X signals that artist A probably is interestingly innovative him/herself (Orosa Paleo & Wijnberg, 2006). The case of the music festival is also suitable to an empirical study of innovativeness due to data availability. The line-ups of festivals are usually well documented and information about the career history of the artists appearing in that line-up is relatively easy to obtain. Also, most industries have explicit product classifications – think of cars classified as saloons, hatchbacks, etc., as well as newer categories such as sport utility vehicles – but there are few industries in which the dynamics of classification processes are as visible as in the music industry. Audiences, producers and artists use, produce and reproduce musical genres in order to confer musical products with meaning (DiMaggio, 1987). New genres are created when new products do not conform to pre-existing categories. Stylistic differences between new products and between new and existing products will therefore be expressed in the creation of new categories in generic classification systems, and the study of the evolution of the latter will allow us to draw conclusions about the innovative performance of producers of new musical products. The particular case study presented in this paper concerns the Noorderslag Festival, one of the better established popular music festivals in the Dutch music industry, which takes place every year in Groningen, the largest city in the north-east of the Netherlands.
The Music Industry and the Music Festival
Methodology
The music industry is a conspicuous example of an industry in which stylistic innovation is a
As we discussed above, there are two main theoretical approaches to innovativeness of a
© 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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new product, regarding the different realms in which the group of referents to which the product is new operate, or regarding changes in competitive dynamics occasioned by the new product and evidenced by how the product is classified relative to the dynamics of the classification system. To obtain a measure of organizational output innovativeness the individual product measures need to be aggregated. Thus, we will construct two aggregate measures of organizational innovativeness: the first, the Referent Innovativeness Index, will represent how new the products are to the organization and its competitors. The second, the Classification Innovativeness Index, will represent the novelty of the product as reflected in how the artists are classified relative to the dynamics of the classification system of the music industry. In respect to both indexes, we will restrict ourselves to the Dutch context, not looking at the novelty of artists to festivals outside the Netherlands or their classificatory status outside the Netherlands. There are two very simple reasons for this restriction: because all the artists performing at Noorderslag are Dutch, the overwhelming majority of them will be new to the world outside the Netherlands, which makes the meaning of innovativeness in that sense rather empty; second, most of these Dutch artists will not have yet found their way to classification databases outside the Netherlands.
Databases We made use of four main databases, which we developed into two intermediate datasets, one concerning festival appearances and generic classification of artists participating in Noorderslag, and another one concerning genre dynamics in the Dutch Top 40. The first main database is that provided by the Nationaal Pop Instituut (henceforth NPI), in which data on the age of artists, generic categorization and record releases can be found. The second database is festivalinfo.nl, a comprehensive Internet resource with up-to-date information concerning Dutch artists’ performance schedule, as well as performance history records. The third database was provided by the Stichting Nederlandse Top 40, and contains information about Dutch Top 40 charts in the period 1965–2003. The fourth one is the complete list of the Noorderslag Festival line-ups through its 20-year existence (http://www.noorderslag.nl). The intermediate datasets we used to make the calculations are: 1. performance and genre data on all the bands performing at Noorderslag in the years under consideration;
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2. data covering the rise and fall of (selected) subgenres in the Dutch Top 40. We compiled complete information for a total of 45 artists/groups out of 52 for the 2004 festival, and 40 artists/groups out of 46 for the 2005 festival. The time-frame of the study thus consists of these 2 years although some of the data necessary for the construction of the indices date from 40 years ago.
Indexes Referent Innovativeness Index The first approach asks for a measurement of the novelty of the artists included in the line-up of the festival in one particular year. We considered novelty of products with respect to two spheres of agents: the organization itself and the Dutch festival industry. So we have two attributes per product: • Novelty to the organization (hereafter NO) reflects the extent to which artists have already participated in the Noorderslag festival in previous years. The data come from http://www.noorderslag.nl. • Novelty to the industry (hereafter NI) reflects the extent to which artists have had previous exposure in any of the music festivals organized in the Netherlands. Data on participation of artists in Dutch festivals was obtained from festivalinfo.nl. The latter comes with an important limitation, since records only start in 1999. Therefore, we added information from other websites which provide information on popular artists and music festivals in the Netherlands: musicfrom.nl, gomagazine.nl and djguide.nl. However, the information in these websites is not always complete and it is therefore possible that previous performances before 1999 have escaped our notice, skewing the results towards a higher degree of innovativeness. For each of the attributes, the scores assigned to each individual artist/group range from 0 to 3. If an artist had never performed in Noorderslag before, he/she/they were assigned a NO of 3; if they had never performed in a Dutch festival before, the NI was 3. If they had performed at Noorderslag or in Dutch festivals one year before the year under consideration, NO and/or NI became 2. Two years before gave a score of 1. Three years or even longer before gave a score of 0 on the two attributes of innovativeness. From the scores on these attributes we calculated the Referent Innovativeness Index © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
ORGANIZATIONAL OUTPUT INNOVATIVENESS
(hereafter RII): a non-negative index, the value of which ranges from 0 to 1. The numerator is the sum of the scores on novelty, NI and NO, for each artist. The denominator would express the maximum score that could be obtained (which, because maximum scores for each artist on each attribute is 3, see below, the total maximum is six multiplied with the number of artists), given the number of artists in the line-up of that year, thus suggesting that the innovativeness of a festival in year t is a proportion of the total possible innovativeness, which has a maximum of 1. Formally, the RII can be expressed as: N
N
∑ NI + ∑ NO n t
RII (t ) =
n =1
n t
n =1
6N
Classification Innovativeness Index The second approach leads us to look at how the artists in the line-up can be classified and how that relates to the dynamics of the classification system in the Dutch music industry. First, we assigned each artist in the line-up to a particular genre, using the NPI database. Where the artist was assigned multiple genres by NPI, we looked only at the youngest one. Second, we determined the age of each (sub)genre. The age of individual subgenres is defined as the difference between the year of the current festival and the start date of the (sub)genre. The start date of a (sub)genre was determined by looking at the historical descriptions of genres in the NPI database, typically including a list of ‘important recordings’, and taking the year of the release of the first important recording. If no such list was given, we determined the years of release of the two oldest records by artists ascribed to the genre: the simple average of these two figures would yield the start date. Third, we scored each of the artists – again ranging from 0 to 3 – on the basis of the age of the subgenre(s), yielding a measure of innovativeness per artist, the age of genre (hereafter AG). In contrast to our approach in respect to the RII, we did not simply assign scores of 3 to artists in genres new to the year of performance, 2 to artists in genres 1 year old, etc. Because there is a significant lag before new genres are recognized as such, we first conducted a preliminary analysis of genre dynamics in the Netherlands. To do so, we used the second intermediate database which consisted of genre identifications, using not just information from the NPI, but also the internet databases of Allmusic and Muziekweb, of all the artists that figured in the Dutch Top 40 in the period 1963–2003. Of the 248 subgenres that © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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appear in the yearly Top 40 in the period considered, we discarded those subgenres with less than five overall records in the period considered or that did not have at least one year in which they figured in the chart at least four times in one year. It does not make sense to calculate average genre dynamics for all subgenres, because the paucity of data points for most subgenres will fail to generate meaningful patterns (see also Christianen, 1995). The resulting sample of genres was 48. Then, we constructed intervals considering four moments in the evolution of a subgenre: the entry date in the Top 40 database, the year in which the number of hits was equal to or greater than 4, the year in which the maximum number of hits was attained, and the exit date from the Top 40. The exit date was calculated in two ways. Those genres active in 2003 were considered to exit the charts one year later, i.e., 2004. The remaining genres were considered inactive after three consecutive years with no hit records. The next step involves the calculation of the averages for each of the following distances: • entry date – first year in which n ⱖ 4 (n = hits by artists of subgenre i) • year of maximum n – exit date • exit date – entry date The results were respectively 5, 10 and 18 years (see Table 1). On the basis of this preliminary analysis, we assigned the score of 3 to artists in subgenres between 0 and 5 years old, 2 to artists in subgenres between 5 and 10 years old, 1 to artists in subgenres between 10 and 18 years old, and 0 to artists in subgenres older than 18 years. After determining the AG scores for all the artists in the line-up, we calculated the Classification Innovativeness Index (hereafter CII) which is a non-negative index, ranging from 0 to 1. The numerator is the AG. Again, the denominator expresses the maximum score on aggregate innovativeness, thus suggesting that the innovativeness of a festival in period t is a proportion of the total possible innovativeness, the latter amounting to a maximum of one. N
∑ AG
N t
CII (t ) =
n =1
3N
Results Tables 2–4 show a descriptive analysis of the Noorderslag festival line-up for the years 2004 and 2005. Table 5 depicts the situation regarding subgenre composition of the line-up. The average age of subgenres displayed in the line-up was
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Table 1. Score Interval Dimensions – 48 Subgenres from the Dutch Top 40 (1965–2003) Subgenre Adult Alt. Pop Rock Adult Contemporary Album Rock Alternative Pop Rock Am Pop Arena Rock Baroque Pop Blues Rock British Blues British Invasion British Psychedelia Bubblegum Club Dance Dance Pop Deep Soul Disco Eurodance Europop Folk Rock Fink Gabber Glam Rock Glitter Hard Rock Heavy Metal Hip Hop House Nederbeat New Wave Pop Pop Rap Pop Rock Prog. Rock Art Rock Psychedelic Psychedelic Pop Rave Reggae Pop Rock & Roll Singer Songwriter Soft Rock Soul Southern Soul Sunshine Pop Synthpop Techno Teen Pop Urban Vocal Pop
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t0
t1
ⱖ4
Maximum
ⱖ 4–t0
t1–max
t1–t0
1978 1971 1967 1979 1969 1965 1966 1965 1965 1965 1967 1966 1977 1974 1968 1969 1975 1970 1965 1974 1995 1971 1971 1965 1968 1980 1978 1965 1978 1965 1988 1965 1967 1966 1966 1990 1970 1965 1965 1966 1966 1968 1965 1971 1990 1988 1974 1965
2004 2004 1996 2004 1975 1995 1970 1974 1974 1975 1973 1977 2004 2004 1970 1995 2003 2000 1974 1987 1998 1980 1979 1995 2001 2004 2000 1972 1992 2001 1994 2004 1994 1976 1971 1996 1994 1994 1977 1993 1997 1970 1969 1989 1998 2004 2004 1981
1988 1978 1970 1988 1970 1979 1967 1965 1965 1965 1967 1970 1978 1983 1968 1974 1993 1975 1965 1984 1996 1974 1972 1965 1991 1991 1990 1966 1979 1965 1991 1965 1977 1967 1968 1992 1988 1965 1970 1970 1968 1968 1967 1984 1992 1999 1978 1973
1988 1986 1970 1988 1970 1979 1968 1965 1965 1965 1967 1972 1993 1986 1968 1978 1994 1994 1965 1984 1996 1974 1972 1975 1992 1991 1993 1966 1984 1966 1991 1984 1977 1967 1968 1992 1988 1965 1973 1978 1980 1968 1967 1984 1992 1999 1987 1973 Average
10 7 3 9 1 14 1 0 0 0 0 4 1 9 0 5 18 5 0 10 1 3 1 0 23 11 12 1 1 0 3 0 10 1 2 2 18 0 5 4 2 0 2 13 2 11 4 8 5
16 18 26 16 5 16 2 9 9 10 6 5 11 18 2 17 9 6 9 3 2 6 7 20 9 13 7 6 8 35 3 20 17 9 3 4 6 29 4 15 17 2 2 5 6 5 17 8 10
26 33 29 25 6 30 4 9 9 10 6 11 27 30 2 26 28 30 9 13 3 9 8 30 33 24 22 7 14 36 6 39 27 10 5 6 24 29 12 27 31 2 4 18 8 16 30 16 18
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Table 2. Noorderslag Festival Line-up (2004) Artist name
Year
First appearance at nl festival
Age
Subgenre
Subgenre age
ADHD ADI-J Alamo Race Track Audiotransparent Bart Skils Basic One Benny Sings Di-rect DJ Chuckie Don Diablo Double Trouble Eleven Epica Gideon Green Hornet Husan Intwine K-liber Lawn League of XO Gentlemen Marike Jager Moss Oil Olabola Opgezwolle Peter Pan Speedrock RMXCRW SneakerFreak Solid Decay Soundtronics Stuurbaard Bakkebaard Suzanna Tasha’s World Terry Toner & Herr Arter This Beautiful Mess Tiedo Treble Voicst We vs Death Within Temptation Wonder Woost Wyatt Zea zZz
2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004 2004
2003 n/a 2001 2001 1995 1991 1999 1999 1993 2002 1996 2001 2002 n/a 1992 n/a 2001 1999 1997 2000 2003 1998 1997 2001 1997 1996 n/a 2003 2002 n/a 1996 1995 2000 2003 1997 2000 2003 1994 2000 1996 2001 2003 1996 1996 2000
1 n/a 3 3 9 13 5 5 11 2 8 3 2 n/a 12 n/a 3 5 7 4 1 6 7 3 7 8 n/a 1 2 n/a 8 9 4 1 7 4 1 10 4 8 3 1 8 8 4
Hiphop Drum ‘n Bass Alternative Alternative Electro Bubbling Lounge Rock DJ’s Bigbeat Hiphop Alternative Gothic Techno Garage-rock Bhangra Rock Bubbling Alternative Hiphop Singer/Songwriter Alternative Hardcore Funk Nederhop Hard Rock Drum ‘n’ Bass Unplugged Techno Bhangra Alternative Kaap Verdië Nu Soul Electro Alternative Rock Meidengroepen Alternative Post-rock Gothic Tekstdichters Alternative Alternative Alternative Psychedelica
22 7 16 16 12 16 5 42 15 7 22 16 12 12 23 12 42 16 16 22 42 16 22 32 22 22 7 12 12 12 16 7 2 12 16 42 36 16 6 12 17 16 16 16 39
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Table 3. Noorderslag Festival Line-up (2005) Artist name
Year
First appearance at nl festival
Age
Ali B. & Band Asrai Autumn Beef Blues Brother Castro Brace Clark, Alain & Band Climax David Gilmour Girls DJ Dana DJ Nuno dos Santos DJ Promo Drillem Electro Côco Erik Vandenberge Face Tomorrow Gem Ghost Trucker ft. Roald van Oosten en Rick Elstgeest Harry Merry Intersection Kasba K-liber Lange Frans & Baas B feat. D-Men Lemonseven LPG Mala Vita Malkovich Marike Jager Mondo Leone Seymour Bits Smutfish Solo Spider Rico Textures THC The Flexican The Sheer The Strikes Vladimir Voicst
2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005
2000 1988 1995 1999 2001 1997 2003 2001 2002 1993 1993 1992 2003 1999 2002 1997 2003 2004
5 17 10 6 4 8 2 4 3 12 12 13 2 6 3 8 2 1
2005 2005 2005 2005 2005
1996 1999 2001 1999 1997
9 6 4 6 8
Singer/Songwriter Marokko Marokko Bubbling Nederhop
2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005 2005
2000 2002 2001 2000 2001 2004 1998 2004 2004 1997 2000 1995 n/a 2000 2004 n/a 1994
5 3 4 5 4 1 7 1 1 8 5 10 n/a 5 1 n/a 11
Pop Lo-Fi Reggae Hardcore Singer/Songwriter Singer/Songwriter House Americana Singer/Songwriter Garage-rock Nu Metal Hiphop DJ’s Britpop Bluesrock Alternative Alternative
18.2 years in the 2004 festival, rising up to 21.55 years in the 2005 festival. This is also reflected in the proportion of acts associated to subgenres younger than 18 years (the threshold of positive scoring for our CII): 31 acts (69 per
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Subgenre
Nederhop Gothic Gothic Reggae Alternative R&B Funk Nederhop House Hardhouse Techhouse Gabber Electro Samba Unplugged Emo-core Alternative Alternative
cent) were labelled with a subgenre younger than 18 years in 2004, whereas this figure dropped to 22 acts (55 per cent) in 2005. Although the changes are not large from one festival to the next, both indexes of © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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Table 4. Previous Exposure of Artists – Noorderslag (2004–2005) 2004
Composition
Number of genres Average genre age Number of genres <18 years % Average artist age Ratio genre age/ artist age
31
RII CII
2004
2005
0.73 0.30
0.69 0.24
0.78 7
0.18 9
11 11 9 33
2 2 3
in
Noorderslag
2004
2005
25 18.20 31
27 21.50 22
0.69 4.80 3.79
0.55 5.58 3.85
innovativeness reflect a decrease. For the 2004 festival, the RII yields a result of 0.73, dropping to 0.69 in 2005 (see Table 6). The CII correspondingly shows a decrease in the innovativeness of Noorderslag, from 0.30 in 2004 to 0.24 in 2005.
Discussion and Conclusions In both years, the RII turns out much higher than the CII. The divergence is important © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
Table 6. Results (Novelty Innovativeness Index, Classification Innovativeness Index)
2005
Artists with Dutch 34 previous exposure % 0.76 Artists with 9 Noorderslag previous exposure % 0.20 No previous Dutch 11 performance Previous Dutch performance Dutch t-1 19 Dutch t-2 7 Dutch ⱖ t-3 8 No previous 36 Noorderslag performance Previous Noorderslag performance t-1 3 t-2 5 ⱖt-3 1
Table 5. Genre (2004–2005)
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because, as we discussed in the theory section, most studies of innovation focus on the novelty-to-referent criterion, incorporated in the RII, and while novelty is a prerequisite for innovation, most authors on the music industry emphasize stylistic novelty when discussing the innovations they deem really important, while stylistic novelty often is signalled by classification dynamics and the appearance of new (sub)genre names. Even Peterson and Berger (1996), who in an earlier study (Peterson & Berger, 1975) used a simple novelty criterion, suggest, ‘non-trivial innovation in music is generally signalled by the wide use of a new name for a style of music and an associated group of performers’ (p. 176). Of course, there can be some interrelatedness between the indices insofar as bands that are new to referents are also more likely to represent new genres. However, even if one prefers the classification index as the most meaningful indicator of organizational innovativeness, that does not make the referent index superfluous. In fact, the RII can add much value to the interpretation of the CII results. Comparing the CII and RII scores of Noorderslag leads to the conclusion that Noorderslag is more concerned about showcasing relatively young bands, while innovation in terms of new subgenres is not a central issue. We do not have sufficient information to propose firm conclusions about Noorderslag in relation to other Dutch festivals, but the data suggest that Noorderslag’s reputation rests not so much on its innovative performance as such, but more on its function as a springboard for new Dutch bands. This study has its limitations. Compared to other industries, the music industry is exceptional with regard to the availability of data, not only about products and sales, but also about classifications of products and producers. However, it certainly is not the only industry to which our approaches could be usefully adapted. See, for instance, the analysis of Lounsbury and Rao (2004) on category durability and change in the American mutual funds industry. The basic story about organizational output innovativeness is fully generalizable to other industries and can prove highly
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useful to achieve a better understanding of what it means to state that an organization is innovative. We have shown how different measures of the innovativeness of organizations can be deduced from different perspectives on product innovation. Of course, in the operationalization of both indexes we have taken many decisions that could have been made differently, primarily with respect to the scoring schemes. The importance of this study lies not in determining the scores or establishing that the 2005 Noorderslag festival seems slightly less innovative than in 2004, and the case study is not a test of the robustness and usefulness of the indexes and the underlying methodology. The main contribution of this study is to show how the concept of organizational output innovativeness can be understood in the light of current theoretical approaches to innovation and to show that the principal ways in which this concept can be understood can be translated into operationalizable indexes, based on measurable data. Precisely by detailing the choices that have to be made to derive meaningful measures from the theoretical approaches, this study has clarified what one has to know to be able to make statements about an organization being more or less innovative. By doing so this study has also demonstrated that the concept of organizational output innovativeness can be usefully employed to achieve a better understanding of innovation management.
Acknowledgements This paper benefited greatly from the useful suggestions and comments of Gerda Gemser and Kristin McGee. The authors would also like to thank Ming Ming Chiu, Joeri Mol, Paul Rutten and Michael Christianen, as well as Geurt van Woudenberg of SENA, Paul de Korver and Matthijs Brouwer of the National Pop Instituut. The usual disclaimer applies.
References Abernathy, W.J. and Clark, K.B. (1985) Innovation: Mapping the Winds of Creative Destruction. Research Policy, 14, 3–22. Brockman, B.K. and Morgan, R.M. (2003) The Role of Existing Knowledge in New Product Innovativeness and Performance. Decision Sciences, 34, 385–420. Castañer, X. and Campos, L. (2002) The Determinants of Artistic Innovation: Bringing in the Role of Organisations. Journal of Cultural Economics, 26, 29–52.
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Caves, R.E. (2000) Creative Industries. Contracts Between Art and Commerce. Harvard University Press, Cambridge, MA. Christianen, M. (1995) Cycles in Symbol Production? A New Model to Explain Concentration, Diversity and Onnovation in the Music Industry. Popular Music, 14, 55–93. Danneels E. and Kleinschmidt E.J. (2001) Product Innovativeness from the Firm’s Perspective: Its Dimensions and Their Relation with Project Selection and Performance. Journal of Product Innovation Management, 18, 357–72. Debackere, K., Clarysse, B., Wijnberg, N.M. and Rappa, M.A. (1994) Science and Industry: A Theory of Networks and Paradigms. Technology Analysis & Strategic Management, 6, 21–38. DiMaggio, P. (1987) Classification in Art. American Sociological Review, 52, 440–55. García, R. and Calantone, R. (2001) A Critical Look at Technological Innovation Typology and Innovativeness Terminology: A Literature Review. Journal of Product Innovation Management, 19, 110– 32. Hirsch, P. (1972) Processing Fads and Fashions: An Organization Set Analysis of Cultural Industry Systems. American Journal of Sociology, 77, 639– 59. Hurley R.F., Hult, G.T.M. and Knight, G.A. (2005) Innovativeness and Capacity to Innovate in a Complexity of Firm-Level Relationships: A Response to Woodside (2004). Industrial Marketing Management, 34, 281–3. Kleinknecht, A.H., Reijnen, J.O.N. and Verweij, J.J. (1990) Innovatie in de nederlandse Industrie en Dienstverlening: een enquête-onderzoek. Ministerie van Economische Zaken, Den Haag. Kleinschmidt, E.J. and Cooper, R.G. (1991) The Impact of Product Innovativeness on Performance. Journal of Product Innovation Management, 8, 240–51. Lounsbury, M. and Rao, H. (2004) Sources of Durability and Change in Market Classifications: A Study of the Reconstitution of Product Categories in the American Mutual Fund Industry, 1944– 1985. Social Forces, 82, 969–99. Mezias, J.M. and Mezias, S.J. (2000) Resource Partitioning, the Founding of Specialist Firms and Innovation: The American Feature Film Industry, 1912–1929, Organization Scence, 11, 306– 22. Orosa Paleo, I. and Wijnberg, N.M. (2006). Popular Music Festivals and Classification: A Typology of Festivals and an Inquiry into their Role in the Formation of Musical Genres. International Journal of Arts Management, 8, 50–61. Peterson, R.A. and Berger, D.G. (1975) Cycles in Symbol Production: The Case of Popular Music. American Sociological Review, 40, 158–73. Peterson, R.A. and Berger, D.G. (1996) Measuring Industry Concentration, Diversity, and Innovation in Popular Music. American Sociological Review, 61, 175–8. Priem, R.L. (2007) A Consumer Perspective on Value Creation. Academy of Management Review, 32, 219–35. Schumpeter, A.J. (1942) Capitalism, Socialism and Democracy. Harper & Row, New York. © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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Wijnberg, N.M. (2004) Innovation and Organiztion: Value and Competition in Selection Systems. Organisation Studies, 25, 1413–33. Wijnberg, N.M. and Gemser, G. (2000) Adding Value to Innovation: Impressionism and the Transformation of the Selection System in Visual Arts. Organisation Science, 11, 323–9. Woodside, A.G. (2004) Firm Orientations, Innovativeness, and Business Performance: Advancing a System Dynamics View Following a Comment on Hult, Hurley, and Knight’s 2004 Study. Industrial Marketing Management, 34, 275–9.
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Iván Orosa Paleo is a PhD candidate at the Faculty of Economics and Business, University of Groningen, the Netherlands. He is interested in the analysis of change in industrial and market environments. In his dissertation, he deals with the role of organizations in the development of classification systems, processes of genre formation and attribution of economic value to musical products and producers in the context of the music industry. Nachoem M. Wijnberg (N.M.Wijnberg@ uva.nl) is Professor of Cultural Entrepreneurship and Management at the University of Amsterdam Business School. He received his PhD from the Rotterdam School of Management. His interests range from innovation management to entrepreneurship to organization theory, with special attention to the competitive dynamics of the cultural industries.
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Innovation Intermediaries: Why Internet Marketplaces for Technology Have Not Yet Met the Expectations Ulrich Lichtenthaler and Holger Ernst A few years ago, internet marketplaces for technology, e.g., yet2.com, received great attention. In the light of open innovation processes, it was assumed that they could be an appropriate means to overcome the imperfections in the markets for technology. Little is known about the performance of these innovation intermediaries, and very limited information is provided by the firms that run the marketplaces. Therefore, we have interviewed intellectual property and technology managers in 25 medium-sized and large industrial companies, who represent the potential licensees and licensors in the internet exchanges. The results show relatively limited success rates of internet marketplaces regarding the number of technology transactions that have been initiated, particularly in comparison with the hopes that had initially been placed in these tools. Moreover, important problems and recent trends in these web-enabled exchanges are identified, and propositions are developed regarding major consequences for initiating and managing technology transactions.
Introduction
I
n recent years, the markets for technology have received great attention from researchers and practitioners (Guilhon, 2001; Gans & Stern, 2003). In these markets, firms acquire and commercialize technological knowledge to complement and capitalize on their technology portfolios (Clarke & Rollo, 2001; de WeerdNederhof & Fisscher, 2003). In contrast to the markets for most products and services, the markets for technology have remained imperfect (Cesaroni, 2004; Lichtenthaler & Ernst, 2007). As technological knowledge is usually commercialized by selling products and services, the markets for technology are not common (Gans & Stern, 2003; Van Looy, Martens & Debackere, 2005). At the same time, there are many imperfections in these markets, which result in high transaction costs (Arora, Fosfuri & Gambardella, 2001; Davis & Harrison, 2001). These two phenomena are mutually dependent because a reduction of the imperfections would lead to a stronger use of the technology markets, which would reduce some of their deficiencies (Lichtenthaler, 2007). Along with the ‘new economy’ hype, many researchers and practitioners assumed that
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the internet could help firms to overcome these market imperfections. The examples of successful pioneering companies, e.g., IBM, which have realized great benefits from technology licensing, further increased the great hopes (Kline, 2003; Chesbrough, 2007). In particular, internet marketplaces for technology were expected to encourage inter-organizational technology transactions. A variety of companies, which were often backed by venture capital, have emerged to facilitate technology trade through internet platforms. Prominent examples are yet2.com, NineSigma, InnoCentive, and the Patent & Licenses Exchange (Bauman, 2000; Huston & Sakkab, 2006). While their service offerings differ, most of these firms try to become the central webenabled marketplace for trading technological knowledge (Bauman, 2000; Chesbrough, 2006). Because of these great hopes, there is now – several years later – also great interest in the performance of these marketplaces (Howells, 2006; Huston & Sakkab, 2006). Very little is known about their success regarding the number of technology transactions that have been initiated, and hardly any information is distributed by the firms that run the marketplaces. Therefore, we have asked the potential © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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beneficiaries of these marketplaces about their experiences. We have interviewed intellectual property and technology managers of technology-intensive companies, who represent the potential licensees and licensors in these markets. Accordingly, this article addresses the following central questions. What are the experiences of industrial firms regarding internet marketplaces for technology? Why have internet marketplaces for technology not yet met the great expectations of researchers and practitioners? The remainder of the paper is structured as follows. In the next section, we provide a brief overview of previous research. Afterwards, the research design is described. Subsequently, the results of the study are presented before highlighting some recent trends in the field. On this basis, we discuss theoretical and managerial implications and develop propositions regarding major consequences for initiating and managing technology transactions. Finally, opportunities for further research are presented. As such, this article offers several contributions. It is among the first empirical studies on internet marketplaces for technology to analyse their managerial implications. In the light of increasing interest in technology transactions (Rivette & Kline, 2000; Grant & Baden-Fuller, 2004), it deepens our understanding of the discrepancies between a few successful pioneering firms in trading technology and many others. Moreover, it contributes to overcoming the under-emphasis on empirical research into technology intermediaries (Spulber, 1999; Howells, 2006). Accordingly, this research deepens our understanding of managing technology transactions and realizing value from technology in open innovation systems (Gassmann, 2006; van der Meer, 2007). Finally, our findings have implications for emerging themes in knowledge management, e.g., organizational boundaries (Arora, Fosfuri & Gambardella, 2001; Santos & Eisenhardt, 2005). These issues have been highlighted as areas ripe for further study in recent reviews of the literature on intermediaries (Howells, 2006), knowledge management (Argote, McEvily & Reagans, 2003), technology exploitation (Lichtenthaler, 2005), and open innovation (West, Vanhaverbeke & Chesbrough, 2006).
Past Research Interest in the role of technology intermediaries has emerged from various fields over the past 20 years (Spulber, 1999; Chesbrough, 2006). These fields include: (1) literature on technology transfer and diffusion, (2) research into managing innovation processes, (3) litera© 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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ture on systems and networks of innovation, and (4) research into service organizations (Howells, 2006). The first line of research has identified the role of intermediaries in identifying partners, helping package technology, selecting suppliers and providing support in deal making (Watkins & Horley, 1986; Seaton & Cordey-Hayes, 1993). The second stream has addressed intermediaries as organizations, whose key function is their brokering role in the technology transfer process (Hargadon & Sutton, 1997; McEvily & Zaheer, 1999). The third line of research has underscored the role of public and private intermediaries that help companies to adapt specialized solutions to the needs of individual user firms (Stankiewicz, 1995; Lynn, Reddy & Aram, 1996). The fourth stream has highlighted the bridging roles that certain types of service firms play in innovation systems (Howells, 1999; Miles, 2000). Regarding more general research into interfirm exchanges, transaction cost theory needs to be tailored to the specific characteristics of the technology markets (Seely Brown & Duguid, 1998). In particular, firms may influence their transaction costs in the medium to long term by developing dynamic capabilities of trading technology based on learning effects. The examples of successful pioneering firms in out-licensing support this capabilitybased view of outward technology transfer (Davis & Harrison, 2001; Kline, 2003). Moreover, the capability-based perspective has received great attention in inward technology transfer, above all in the literature on absorptive capacity (Cohen & Levinthal, 1990; Zahra & George, 2002). In conclusion, there are various lines of research that have deepened our understanding of intermediaries in the markets for technology, but the insights into their roles are limited, especially regarding internet marketplaces for technology (Lichtenthaler, 2005; Howells, 2006).
Research Design In the light of the limitations of previous research and increasing technology trade, it is the goal of this study to gain insight into the intermediating role of internet marketplaces for technology. The study’s focus is on the experiences of medium-sized and large industrial companies whose main business is internal technology exploitation. Accordingly, these firms focus on the application of technologies in their own products and services (March, 1991; Cesaroni, Di Minin & Piccaluga, 2005). Thus, we have analysed the internet-based technology exchanges neither of start-up companies nor of firms that provide mainly R&D
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services. Nearly all of the companies in the sample have at least considered or have already realized technology transactions as the technology source and recipient. Therefore, all firms could be analysed regarding potential inward and outward technology transfer. A thorough review of previous research has shown that technology trade through internet marketplaces has not yet been examined in detail (Lichtenthaler, 2005; Howells, 2006). Accordingly, a qualitative research design was chosen to respond to the need for deep understanding, local contextualization, and causal inference (Miles & Huberman, 1994). Our discussion of past research has demonstrated that these needs apply to the analysis of firms’ experiences with internet marketplaces for technology. Hence, the case study method was chosen because of the study’s exploratory character. In the light of a highly complex research object, the case study method allowed for a flexible and comprehensive examination of the issues. The process of conducting case studies followed the suggestions that have been given in seminal works on case study research (Eisenhardt, 1991; Yin, 2003; Eisenhardt & Graebner, 2007). Thus, our approach was similar to the designs of case study-based works that have been published recently in leading journals (Schweizer, 2005). Through the focused selection of mediumsized and large industrial companies, different experiences with internet marketplaces could be analysed (Miles & Huberman, 1994). Technology trade was studied at the organizational level and at the level of specific technology transfer projects. By applying the firm-level view, the overall experiences were analysed. By examining specific projects, the firms’ technology transfer processes were studied in the context of a specific project. Only the simultaneous analysis of the micro level of projects and the macro level of corporate experiences allowed for drawing implications for managing technology trade (Miles & Huberman, 1994). Besides analysing firms from various industries, the sample comprises firms where licensing plays different roles regarding its importance, objectives and management. Thus, the experiences of these firms provided different perspectives on technology marketplaces. After five preliminary unstructured interviews, questionnaires were used as a basis for semi-structured interviews in the final study. This procedure ensured comparability and ample opportunity for unobstructed narration. The data collection process followed Yin (2003). During the interviews, the interviewer took notes and typed them up each night. All data were included in writing up of the cases, even when not specifically requested in
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the questionnaire. Furthermore, additional documents, e.g., company-internal analyses of licensing transactions and company-external publications, were studied. Next, the memoing process was followed to record patterns that the interviewer noted within and across cases (Yin, 2003). Each interview was structured to facilitate within-case as well as subsequent cross-case analyses (Miles & Huberman, 1994). After these analyses, the implications that are presented in this article were drawn. In companies with a dedicated licensing unit, this unit’s head was interviewed. In companies without a dedicated unit, we talked to the head of the corporate intellectual property department. In ten companies, a second person from the R&D department, who is not directly occupied with licensing, was interviewed. By drawing on the insights of this second person, a more detailed picture of a firm’s experiences could be gained. Altogether, 35 persons were interviewed in 25 German and Swiss companies. The firms’ average R&D intensity is about 6 per cent. Seven of these firms are active in the chemical/pharmaceutical industry; nine are active in the automotive/machinery industry; and the other nine firms are active in the semiconductors/electronics industry. With an average of 8,457 employees and average revenues of €2,135 million, the companies in the sample are relatively large. We followed a sampling strategy in which we sought variance regarding the topics analysed in this study. In particular, the choice of industries was influenced by prior research, which reported different functions of technology licensing in these industries (Grindley & Teece, 1997; Teece, 1998; Rivette & Kline, 2000). As the purpose of the study was deepening our understanding of internet marketplaces for technology, the sample was not selected to ensure representation of the population of all medium-sized and large industrial firms. Instead, the sample was selected to include sufficient variation to explore factors relating to the internet marketplaces. Despite participation being voluntary, the sample was not a selfselected group of firms. As the following section shows, there was sufficient variance in the managerial approaches of firms to internet marketplaces for technology. This sampling process followed prior works in leading journals (e.g., Edmondson, Bohmer & Pisano, 2001).
Results Current Practice All companies are well aware of the potential benefits of internet marketplaces and have at © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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least studied the web pages of different service providers in detail. In various cases, however, no consideration had been given to actually putting technologies into the marketplaces because the strategy of these firms focused exclusively on the application of technologies in their own products. Similarly, various companies did not have any interest in licensing in technologies through these platforms because of their focus on internal R&D. By contrast, many firms have actively tried to use the marketplaces by offering technologies or searching in detail for interesting technologies. In general, the firms that addressed the internet marketplaces most actively are the firms that also carry out internal activities of initiating technology transactions more actively. For instance, most of the firms that offered various technologies on the internet marketplaces also have a dedicated internal organizational unit that is directed towards managing technology licensing activities. This finding points to the complementary character of internet marketplaces and a firm’s internal activities of identifying technology transfer opportunities. Finally, these complementary activities may result in a portfolio of interfirm technology transactions that comprises various contractual forms, e.g., licensing agreements, strategic alliances and joint ventures. Some of these technology-based relations even ended up in a transfer of parts of organizational units beyond the transfer of technological knowledge, i.e., acquisitions in inward technology transfer and spin-offs in outward technology transfer. For example, one contact evolved into a strategic alliance that eventually resulted in the acquisition of a part of a relatively small firm by one of the large chemical firms in the sample. In general, the success rate of relying on internet marketplaces for technology has been relatively low with regard to the number of technology transactions that have been initiated, particularly in comparison with the hopes that had initially been placed in the marketplaces. Many industrial firms have invested substantial time and resources in preparing and documenting technologies for the internet exchanges and in searching for suitable technologies. For instance, several firms have set up internal projects with participants from different organizational units to decide on their technology offerings. However, most companies have not realized any technology transaction by means of web-enabled platforms. The maximum of transactions for a single company has been one out-licensing agreement and one in-licensing agreement. As a result, most industry experts have relatively reserved attitudes to these marketplaces, © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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which sharply contrast the euphoria that existed several years ago. Nearly all firms that have not actively tried to realize technology deals are informed surprisingly well about the unsuccessful activities of other companies regarding the number of technology transactions that have been initiated through the marketplaces. The limited success of these firms has been communicated through informal inter-firm networks. On this basis, only two of the 25 companies wanted to give the internet marketplaces another chance in the short to medium term by offering a considerable portion of their technology portfolios on yet2.com and closely screening further marketplaces. One firm even plans to assign a person exclusively to the co-ordination of its technology offerings on yet2.com and other internet marketplaces, particularly with regard to an adequate preparation and documentation of the technologies. Regarding technology acquisition, most companies still plan to search the internet platforms or post a notice of a technology need when trying to identify potential technology sources in the future. However, these firms do not expect to realize many licensing transactions by means of the marketplaces.
Licensors’ Perspective According to the industry experts, the most severe deficit of internet marketplaces is that the commercialization of technology through these platforms constitutes a relatively unsystematic approach because it does not address specific technology customers. Instead, the firm’s intention to license technological knowledge is communicated very broadly. Furthermore, offering a technology through the internet is a relatively passive approach. This offer merely constitutes an invitation to treat because the initiative for the actual technology transaction has to come from the potential licensee. An additional reason why a first inquiry has often not occurred is inherent in the technologies that have been offered. In many cases, the source firms have put relatively unattractive technologies in the databases. The main aim behind these offers was the optimization of the technology portfolio by externally leveraging technologies of relatively limited value. Accordingly, the success rate of commercializing technology through these marketplaces measured by the number of technology transactions that have been initiated is relatively low. Thus, it is necessary to offer a substantial portion of the technology portfolio to arrive at a single technology transaction. However, this open approach is often impossible because of
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the concerns of top management and highranking R&D employees. While these reluctant attitudes are partly based on rational arguments following corporate strategy, they are often complemented by irrational feelings of individuals, who are resistant to the idea of transferring a firm’s technology assets. This resistance is particularly strong if the technologies are of relatively high value or close to a firm’s core technologies. Furthermore, offering a large number of technologies requires substantial resources. A thorough presentation of the technologies is essential to generate interest from potential licensees. Because of these resource requirements, many firms argue that the time needed to identify technology customers can be put to better using other – more proactive – commercialization channels. This is particularly true in cases where a firm may describe possible applications of a technology in relative detail. If these ideas exist, potential licensees may be identified in a more direct way by relying on the firm’s existing business relationships, i.e., buyers, suppliers and competitors, or on its contacts in other industries through formal and informal networks. As a result, internet marketplaces currently do not seem to be an appropriate means to significantly reduce the transaction costs in the markets for technology from the perspective of potential licensors. Moreover, the challenge of identifying interesting applications before actively commercializing technology is not overcome. Because of the interdependencies between the limited use of the technology markets and the problems inherent in them, which may not directly be offset by webenabled exchanges, this vicious circle is likely to persist in the future – at least to a certain degree.
Licensees’ Perspective Similar to the licensors’ perspective, industry experts consider the unsystematic approach to be the main disadvantage of identifying and acquiring technology by means of internet marketplaces. Usually, it is difficult or impossible to find an appropriate technology for a specific technology need. Despite containing large numbers of technologies, one reason for this problem is the limited number of technologies that are offered in the marketplaces. While this limitation is inherent in a database approach, it is aggravated by the fact that many of the technologies represent residual knowledge, which is of relatively low value and unused in the source firms. Moreover, the number of technologies that are offered in one particular technological field is often limited.
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In many cases, the focus of the internet exchanges is still on the technological fields of the websites’ founding members. If a particular technology need exists, it may therefore be easier to direct the resources for identifying potential technology sources to other channels. Examples of more systematic approaches are patent analyses and a firm’s networks. These networks not only encompass formal relationships with other firms, e.g., strategic alliances, but also informal personal relationships, e.g., inter-firm contacts between technology or intellectual property experts. Furthermore, potential licensors may be observed in many cases as a part of regular technology intelligence processes. If no specific technology need exists, the search for technologies in internet marketplaces is a random approach with limited chances of initiating a technology transaction. Because of increasing technology convergence, the technology descriptions on the web pages often do not include the specific application for which the technology need exists. Thus, the identification of a technology still requires a creative element by matching the particular technology with the application that the person who is searching the marketplace has in mind. For this challenge, posting a technology need does not represent a solution because it merely transfers the need to establish a link from the potential licensee to the potential licensor. An additional problem of externally acquiring technological knowledge is the fact that a firm will be continually observed by the potential licensor regarding infringements of its intellectual property rights if no agreement is reached between the parties. This may happen for a number of reasons, e.g., inappropriate prices or characteristics of the technologies. Finally, this process may lead to infringement lawsuits. In this context, one intellectual property expert frankly stated: ‘Nobody likes to pay license fees’. In addition to these practical difficulties, these factors are also brought forward to justify the ‘Not Invented Here’ syndrome, i.e., negative attitudes to the acquisition of external technology. In particular, this bias may be found among R&D experts, who often tend to invent around the intellectual property rights of other firms instead of attempting to get a licence for these technologies.
Integrated Perspective A comparison of the licensors’ and licensees’ perspectives shows major similarities between these views. The main problem of internet exchanges is the unsystematic nature of partner identification. Because of the limited success rate in identifying and realizing © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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transactions, the search process requires considerable resources. As technology transfer through web-based exchanges constitutes only one of a number of channels, the alternative ways appear more promising to many firms, particularly if a detailed idea exists for applying a technology. Thus, internet marketplaces may only mitigate the difficulty of linking technologies to appropriate applications or vice versa, but this still represents the critical managerial challenge. In addition, the importance of cultural barriers has to be highlighted, although they are not a problem specific to internet-based exchanges. These cultural barriers often prevent a more active approach to trading technology. In many cases, they may therefore be considered the underlying cause of refraining from technology transactions. An integrated perspective also points to some industry differences. Firms from the chemical/pharmaceutical industry appear to have initially attributed a higher importance to technology licensing through internet marketplaces than firms from the other industries. However, chemical/pharmaceutical companies also seem to internally manage their licensing activities more proficiently than firms from the other industries. Thus, the data support prior research, which has underlined the high importance of licensing transactions in this sector. Accordingly, these firms are now relatively reluctant to use internet marketplaces for technology because alternative channels, e.g., informal inter-firm networks, seem to have provided an essential avenue for initiating technology transactions in this sector in the past. Similarly, the importance of internet marketplaces appears to be surprisingly low in the electronics/semiconductors industry although the relevance of licensing in this industry has been described in relative detail in prior research. By contrast, the potential of internet marketplaces for technology is considered surprisingly high in the automotive/ machinery industry. As technology licensing in this sector has received limited attention in prior research, it deserves further study to offer a better understanding to firms aiming at optimally utilizing their technologies in this field.
Discussion Recent Trends Very recently, major changes have occurred in the strategic approach of various internet marketplaces. While these developments could be observed in various marketplaces, they appear to have influenced in particular yet2.com. © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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At the beginning, yet2.com focused on its internet-based infrastructure (Bauman, 2000). Potential licensors put their offers online, whereas potential licensees could search for technologies in the database. Recently, however, yet2.com seems to have realized that the complexity of technological knowledge requires a more active approach to exchanging technology. This new understanding of technology transactions has led yet2.com to substantially transform its business model (Jahn, 2005). Before this reorientation, yet2.com had about 80 employees, who were occupied mainly with marketing and acquiring new users of its internet platform. After redirecting the business model, yet2.com employs about 20 people, who are not primarily occupied with marketing but with actively facilitating technology transactions. Thus, yet2.com no longer focuses exclusively on its internet database. The internet platform still constitutes an important feature, but yet2.com attempts to play a more active role in connecting licensors and licensees. Thus, the business model has been transformed from focusing on the webenabled infrastructure towards concentrating on a more active approach to technology brokering. Therefore, the 20 employees at yet2.com comprise mainly scientists and engineers, often with PhD degrees in their technological fields. Their knowledge is used to facilitate deals on technology packages instead of focusing on patent rights (Jahn, 2005). These new service offerings led to approximately ten technology transfers in 2004. This figure is contrasted with the 90,000 registered users, which underlines the difficulties in facilitating technology transactions. As a result of the new strategic approach, however, yet2.com expects to strongly increase the number of deals that are closed as a result of its brokering activities in the coming years (Jahn, 2005). Similar to the strategic changes at yet2.com, various other internet marketplaces for technology that were created in recent years, e.g., NineSigma, pursue a more active approach to facilitating technology exchanges. Thus, a major portion of their service offerings refers to active brokering, whereas databases only represent additional infrastructure to facilitate deals. Thus, yet2.com’s reorientation is not a singular development. Instead, it may represent a new approach to internet marketplaces, which links them to active forms of technology brokering.
Theoretical and Managerial Implications The limited success rates of internet exchanges with regard to the number of technology transactions that have been initiated have
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various consequences for managing technology transactions. In particular, some problems of internet marketplaces do not apply to other types of intermediaries, which offer consulting services beyond introducing technologies in databases (Bryant & Reenstra-Bryant, 1998; Sawhney, Prandelli & Verona, 2003; Howells, 2006; Verona, Prandelli & Sawhney, 2006). Accordingly, industrial firms could rely more on agents (Bidault & Fischer, 1994; Morgan & Crawford, 1996), who help a company to proactively identify technology customers or reactively identify infringers of its intellectual property. Similarly, the recent developments of internet marketplaces, which tend to offer integrated services including a more active component, may help to overcome the deficits of pure databases. As such, our analyses point to the superiority of accessing integrated service offerings of intermediaries that go beyond internet-related databases. Therefore, we posit the following proposition: Proposition 1: Integrated service offerings help firms to enhance their benefits from relying on intermediaries in the markets for technology. Moreover, firms should attempt to adequately use their own knowledge, which is distributed across the organization (Ernst, Leptien & Vitt, 2000; Basadur & Gelade, 2006), in order to link technologies and applications (Kogut & Zander, 1992; Cillo, 2005). This finding is consistent with prior research into managing licensing transactions (Gallini & Winter, 1985; Anand & Khanna, 2000; Agrawal, 2006; Lichtenthaler, 2007). A successful approach to this central challenge of exchanging technology could be the ‘functional market concept’. This concept emphasizes ‘thinking in functions’ by focusing on technologies as means to reach various objectives, thus separating a technology from a certain context (Weiß, 2004). In particular, diversified firms may rely on the overlapping knowledge bases of their business units and technological fields to identify licensing opportunities (Brockhoff & Chakrabarti, 1988; Griffin & Hauser, 1996). Furthermore, the identification of exchange partners may be integrated into a firm’s regular technology intelligence processes (Gassmann & Gaso, 2004; Frishammar & Hörte, 2005). Thus, it appears beneficial to rely on intermediary services as a complement rather than as a substitute for a firm’s internal activities (Wenger & Snyder, 2000; Verona, Prandelli & Sawhney, 2006). Accordingly, we suggest the following proposition: Proposition 2: Complementing intermediary services with internal activities helps
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firms to enhance their benefits from relying on intermediaries in the markets for technology. Furthermore, companies may rely on the knowledge embedded in their interorganizational networks (Madhavan, Koka & Prescott, 1998; Grant & Baden-Fuller, 2004). These formal and informal ties may lead directly to technology transactions, and they may also provide information and indirect contacts to other firms which may finally facilitate technology transactions (Gulati, 1999; Hislop, 2002). In addition, these networks may help to increase the technology push and market pull effects in a firm’s licensing activities. For instance, most large pharmaceutical firms openly communicate their intention to license in technologies, and they have established dedicated licensing units. This open approach has strengthened technology push effects, i.e., technology offers that the pharmaceutical firms receive from biotechnology companies (Rothaermel & Deeds, 2004; Gassmann & Reepmeyer, 2005). By contrast, an advanced example of combining market pull effects and networks is IBM’s website alphaWorks (http://www.alphaworks.ibm. com), which was created in 1996 by IBM’s internet division hoping that outside companies and developers would contribute ideas about bringing the programs to market (Wolpert, 2002). Today, thousands of persons are using the web site, on which over 200 technologies, usually at the early stages of development, are available for download, including the option to license these technologies. The positive effects of complementing intermediary services with the knowledge embedded in a firm’s inter-organizational networks, which go beyond a company’s internal activities, suggest the following proposition: Proposition 3: Complementing intermediary services with inter-firm networks helps firms to enhance their benefits from relying on intermediaries in the markets for technology. Usually, a main strength of internet marketplaces is their cross-industry character (Johansson, 2004; Chesbrough, 2006). For instance, an electronics firm that we interviewed had licensed a technology to a chemical company through an internet platform. Thus, dividing marketplaces into industry areas does not seem beneficial. However, the IBM example has shown that leading companies may create their own marketplaces to enlarge and intensify their offline networks. This approach may help to combine personal contacts with the advantages of web-based © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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tools. The emphasis on networks may help to reduce some deficiencies of the marketplaces because it contributes to a realistic view of managing technology transactions (Ford, 1988; Bessant & Rush, 1995; Sawhney, Verona & Prandelli, 2005). In particular, the development of internal capabilities of managing technology transactions seems to be inevitable. Internal capabilities are important for co-ordinating external service providers, e.g., by thoroughly preparing technology offers in the marketplaces. By suggesting a relationship between internal competencies and organizational boundaries, this study has provided support for competence-based perspectives in boundaries research, which go beyond efficiency-based analyses, e.g., transaction costs (Fisscher et al., 2001; Santos & Eisenhardt, 2005). Similar to the development of alliance capability, learning effects in coordinating the service offerings of intermediaries likely have positive effects (Sawhney & Prandelli, 2000; Lichtenthaler & Lichtenthaler, 2004; Kale & Singh, 2007), and they suggest the following proposition: Proposition 4: Developing dynamic capabilities of co-ordinating intermediary services helps firms to enhance their benefits from relying on intermediaries in the markets for technology. In addition, it has to be highlighted that technological knowledge is an idiosyncratic good (Steele, 1989; Fosfuri, 2006). Apart from the fact that technologies are dynamically evolving, Granstrand (2000) has identified the following six major properties of technological knowledge, not all of them shared by other types of knowledge. Technology has an artifact link, it has a science link and, in general, a relatively high degree of codifiability. Furthermore, it has a practical purpose, it is linked to globally oriented common systems for its operationalization and assessment, and it may be protected by patent rights (Granstrand, 2000). Besides the challenges of actually transferring technology, the characteristics of technological knowledge lead to appropriability issues, which exist in all types of intellectual property regimes (Cummings & Teng, 2003; Pisano, 2006). Thus, the technology source often has to actively support the technology transfer to ensure successful technology absorption at the recipient (Amesse & Cohendet, 2001; Agrawal, 2006). This is necessary if a firm enters an agreement as a licensor or as a licensee (Teece, 1998; Arora, Fosfuri & Gambardella, 2001). Accordingly, we propose: Proposition 5: An active support of the technology transfer helps firms to enhance © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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their benefits from relying on intermediaries in the markets for technology. Intermediaries in general and internet marketplaces for technology in particular may mitigate the market imperfections that result from these technology and market characteristics (Shohet & Prevezer, 1996; Lichtenthaler & Ernst, 2006). However, the markets for technology will likely remain less perfect than the markets for most products and services. Moreover, the nature of technological knowledge contributes to explaining the differences between some markets, where intermediation works efficiently, and other markets, e.g., technology markets, where intermediation remains difficult despite information and communication technologies that facilitate intermediary services (Granstrand, 2000; Howells, 2006). In particular, intellectual property rights may function as a facilitator of technology transactions. The analysis of Arora, Fosfuri and Gambardella (2001) suggests that ‘stronger IPRs [intellectual property rights] can enhance the efficiency of technology transfers, and hence encourage the diffusion of technology, including parts of the technology that patents do not protect’ (Arora, Fosfuri & Gambardella, 2001, p. 117; see also Williamson, 1991). The fact that intellectual property rights work particularly well in specific industries and technology areas, e.g. in the chemical industry, has contributed considerably to the emergence of markets for technology in these fields (Levin et al., 1987; Teece, 1998; Arora & Fosfuri, 2000; Cesaroni & Mariani, 2001). Therefore, firms should respond to these differences in the appropriability regimes by aligning their intermediary services with the particular situation (Chesbrough, 2006; Howells, 2006). Hence, we propose: Proposition 6: Aligning the intermediary services with appropriability regimes helps firms to enhance their benefits from relying on intermediaries in the markets for technology.
Conclusion Simultaneous to the ‘new economy’ bubble, there seems to have been an exaggerated hope to overcome the imperfections in the markets for technology by means of internet exchanges. Today, these marketplaces have not yet met the great expectations of most researchers and practitioners. Instead, they merely represent an additional way of identifying technologies or applications. While the hopes in the beginning may have been unrealistic, there are possibilities for improving the
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current situation. The new approach of internet marketplaces, which goes beyond providing infrastructure to include additional consulting services, appears to be a promising avenue. In particular, it takes into account that most technology exchanges do not constitute arm’s length transactions because technological knowledge is an idiosyncratic good. As the volume of technology trade likely continues to increase, the market imperfections may simply be reduced by higher numbers of technology transactions. In addition, increasing technology transactions may change the organizational cultures of many companies towards more open approaches to transferring technology. In the light of growing technology transactions, future studies may help to deepen our understanding of the role of internet marketplaces for technology. In particular, large-scale empirical studies constitute an interesting avenue for further research. These studies may analyse firms’ propensity to rely on intermediaries and the intermediaries’ impact on the performance of corporate licensing strategies. These studies may lead to results that are equally relevant to academics and practitioners.
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Howells, J. (2006) Intermediation and the Role of Intermediaries in Innovation. Research Policy, 35, 715–28. Huston, L. and Sakkab, N.Y. (2006) Connect and Develop: Inside Procter & Gamble’s New Model for Innovation. Harvard Business Review, 84, 58–66. Jahn, T. (2005) Marktplatz für Ideen. McK Wissen, 82–7. Johansson, F. (2004) The Medici Effect: Breakthrough Insights at the Intersection of Ideas, Concepts, and Cultures. McGraw-Hill, New York. Kale, P. and Singh, H. (2007) Building Firm Capabilities through Learning: The Role of the Alliance Learning Process in Alliance Capability and Firm-Level Alliance Success. Strategic Management Journal, 28, 981–1000. Kline, D. (2003) Sharing the Corporate Crown Jewels. MIT Sloan Management Review, 44, 89–93. Kogut, B. and Zander, U. (1992) Knowledge of the Firm, Combinative Capabilities, and the Replication of Technology. Organization Science, 3, 383–97. Levin, R.C., Klevorick, A.K., Nelson, R.R. and Winter, S.G. (1987) Appropriating the Returns from Industrial Research and Development. Brookings Papers on Economic Activity, 3, 783–820. Lichtenthaler, U. (2005) External Commercialization of Knowledge: Review and Research Agenda. International Journal of Management Reviews, 7, 231–55. Lichtenthaler, U. (2007) The Drivers of Technology Licensing: An Industry Comparison. California Management Review, 49, 67–89. Lichtenthaler, U. and Ernst, H. (2006) Attitudes to Externally Organising Knowledge Management Tasks: A Review, Reconsideration and Extension of the NIH Syndrome. R&D Management, 36, 367– 86. Lichtenthaler, U. and Ernst, H. (2007) Developing Reputation to Overcome the Imperfections in the Markets for Knowledge. Research Policy, 36, 37–55. Lichtenthaler, U. and Lichtenthaler, E. (2004) Alliance Functions: Implications of the International Multi-R&D-Alliance Perspective. Technovation, 24, 541–52. Lynn, L.H., Reddy, N.M. and Aram, J.D. (1996) Linking Technology and Institutions: The Innovation Community Framework. Research Policy, 25, 91–106. McEvily, B. and Zaheer, A. (1999) Bridging Ties: A Source of Firm Heterogeneity in Competitive Capabilities. Strategic Management Journal, 20, 1133–56. Madhavan, R., Koka, B.R. and Prescott, J.E. (1998) Networks in Transition: How Industry Events (Re)shape Interfirm Relationships. Strategic Management Journal, 19, 439–59. March, J.G. (1991) Exploration and Exploitation in Organizational Learning. Organization Science, 2, 71–87. van der Meer, H. (2007) Open Innovation – The Dutch Treat: Challenges in Thinking in Business Models. Creativity and Innovation Management, 16, 192–202. Miles, I. (2000) Services Innovation: Coming of Age in the Knowledge-Based Economy. International Journal of Innovation Management, 4, 371–89.
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Ulrich Lichtenthaler (Ulrich.Lichtenthaler@ whu.edu) is an assistant professor of Technology and Innovation Management at WHU – Otto Beisheim School of Management, Vallendar, Germany. His research interests include technology exploitation, technology transfer, interfirm alliances and licensing. He has published in the Journal of Product Innovation Management, Journal of Business Venturing, Research Policy, IEEE Transactions on Engineering Management, International Journal of Management Reviews, R&D Management, California Management Review and other journals. Holger Ernst is professor at WHU – Otto Beisheim School of Management, Vallendar, Germany where he holds the Chair for Technology and Innovation Management. He was visiting professor at the Kellogg School of Management, Northwestern University, Evanston, IL, USA in 2005 and 2006. His main research interests are in the fields of technology and innovation management, intellectual property management, new product development and entrepreneurship. He has published in the Journal of Product Innovation Management, International Journal of Management Reviews, Journal of Engineering and Technology Management, IEEE Transactions on Engineering Management, Research Policy and R&D Management. He consults multiple European organizations in the area of technology, patent and innovation management.
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A Social Network Perspective of Lead Users and Creativity: An Empirical Study among Children Jan Kratzer and Christopher Lettl Generating ideas at the ‘fuzzy front end’ of new product development is risky and has serious consequences for all preceding development stages. One of the currently most prominent techniques in supporting this idea-generation stage is the lead user approach. Involving lead users in idea generation closely correlates to individual creativity, and both, in turn, to the provision of information in social networks. This study, guided by lead user theory, creativity research and network theory, investigates 16 school-groups of children examining the relationship between the children’s social networks and their resulting creativity and lead userness. In addition, the interplay between lead userness and creativity is discussed and empirically tested. The main result of this study is that children who are positioned as bridging links between different groups in social networks reveal both a high degree of lead userness and a high level of creativity.
Introduction
T
he idea-generation stage is often called the ‘fuzzy front end’ of new product development because it typically lacks well-defined processes and reliable information (Dahl & Moreau, 2002). The new product development literature suggests several strategies for generating new product ideas, including such techniques as benchmarketing (Ulrich & Eppinger, 2000), user observation (Leonard & Rayport, 1997), analogical thinking (Srinivasan, Lovejoy & Beach, 1997) and lead user analysis (von Hippel, 1986). Of these techniques, lead user analysis has the greatest empirical support as a driver of commercially attractive and highly novel new product ideas (e.g., Lüthje, Lettl & Herstatt, 2003; Lüthje, Herstatt & von Hippel, 2005; Franke, von Hippel & Schreier, 2006; Schreier, Oberhauser & Prügl, 2007). However, creating new product ideas is particularly difficult when engaged in complex and uncertain markets such as markets for children (e.g., Kunst & Kratzer, 2007). There is a growing interest in the children’s consumer market both in the academic literature and from a business point of view. McNeal (1992) identified children as representing three markets in one: a primary
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market spending its own savings or allowances; a secondary market of ‘influencers’ on mainly parental spending; and a tertiary, future market of potential adult consumers. Children are very often inventors themselves, developing new product ideas at the ‘fuzzy front end’ that are relevant to many peer children and sometimes even for adults. More and more firms have started to leverage the fantasy and creativity of children for their new product development: children have been developing ideas for building models for LEGO and computer game features for computer game producers (Jeppesen & Molin, 2003). Acknowledging the high potential of children as idea creators, the United States Patent and Trademark Office together with the Advertising Council and the National Inventors Hall of Fame launched a national campaign in April 2007 to more systematically facilitate innovation by children (http:// www.uspto.gov). As children are lacking in previous experience and well-established cues to the quality or functionality of products, the interpersonal exchange of information becomes extraordinarily important (Hanson & Putler, 1996). This interpersonal exchange of information is the most important informal means of © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
A SOCIAL NETWORK PERSPECTIVE OF LEAD USERS AND CREATIVITY
communication between consumers (Rosen, 2000; Derbaix & Vanhamme, 2003). As Burt (2004) proposes, people connected to groups beyond their own can expect to find themselves delivering valuable ideas and being more creative. Creativity may be couched in the social networks of children, because new ideas require the recombination of existing knowledge (Csikszentmihalyi & Sawyer, 1995). There is a growing body of research showing the importance of social networks for creativity (e.g., Leenders, Van Engelen & Kratzer, 2003, 2007; Burt, 2004; Kratzer, Leenders & Van Engelen, 2004). In the scope of this study, creativity is defined according to Amabile (1988), who argues that creativity is exhibited when a product or service is generated that is both novel and useful with respect to the firm. Social networks of children may also be important for innovation activities because they may engage in developing new ideas themselves, possessing need- and use-related knowledge as consumers. A user innovator who is socially connected to other users is provided with valuable information how to improve her/his solution (Franke & Shah, 2003; Harhoff, Henkel & von Hippel, 2003). Accordingly, lead user behaviour inevitably refers to a certain degree of creativity and both lead user characteristics and individual creativity may be embedded in social networks. This study investigates the issues raised among networks of children guided by two questions: 1. Can lead users and creative individuals among children be identified by the nature of their social networks? 2. Is there an interplay between the children’s creativity and the extent to which they can be identified as lead users? In this paper we aim to simultaneously extend and integrate lead user theory and concepts about creativity by exploring social networks of children. In this way the study adds threefold to the existing literature. First, the study contributes directly to the field of lead user research by linking individual positions within social networks and lead user characteristics. Lead users are described as users who are ahead of an important market trend and expect high benefits from innovating and will be most likely to develop attractive innovations (e.g., Urban & von Hippel, 1988; Morrison, Roberts & Midgley, 2000; Franke & von Hippel, 2003; Lüthje, Lettl & Herstatt, 2003; Lüthje, Herstatt & von Hippel, 2005). Despite these encouraging findings, there is generally still a limited understanding of who lead users are and why they are leading-edge © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
Figure 1. Network Configurations of Centrality and Betweenness Centrality
27
Degree
in a given field. Second, the study attempts to integrate lead user theory and creativity research as two inevitably linked but scarcely integrated fields. Third, the study is one of the first to engage in lead user theory and creativity research concentrated on children as the study population. Our empirical study is executed among 16 school-groups encompassing 366 children.
Social Networks, Lead Users and Individual Creativity: Hypotheses When studying social networks, it appears that social structures comprise clustered networks of people with various ties among them (Bandura, 2001). Among others, Burt (1992, 2004), Granovetter (1973) and Freeman (1979) tried to identify and characterize the weak links in networks bridging these clusters. Freeman (1979)1 conceptualized this structural configuration as betweenness centrality. This kind of centrality does not refer to the number of ties, but refers to the extent to which an actor facilitates the flow of information being positioned on many informational paths. In contrast to betweenness centrality, another centrality measure refers to the number of direct contacts of individuals embedded within clusters. This measure is called degree centrality (Freeman, 1979). Figure 1 depicts the differences between the two centrality measures. The shaded ovals represent actors with a high degree centrality, the black oval represents an actor with a high betweenness centrality. Lead users are on the leading edge of an important market trend and develop radically new product concepts by applying diverse knowledge bases to a perceived problem or 1
There are other conceptualizations such as the constraint concept of Burt (1992); however, degree centrality has proved to be the most straightforward and robust measure (Krackhardt, 2002).
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need (von Hippel, 1986; Riggs & von Hippel, 1994; Lilien et al., 2002). The main incentive of lead users to innovate is to find appropriate solutions for their needs. Lead users tend to combine and reassemble any type of prior technological knowledge which leads to a solution best fitting their needs (von Hippel, 2005). Insights into archetypal lead user innovations such as the first device for gas chromatography (Riggs & von Hippel, 1994), the first surgical navigation systems, the first medical robot for neurosurgery and the first biocompatible implant for hernia surgery (Lettl, Herstatt & Gemuenden, 2006), or the first mountain bike (Lüthje, Herstatt & von Hippel, 2005) reveal that the respective lead user inventors combined diverse technological knowledge fields. Like lead users, individuals with diverse knowledge bases are expected to be more creative than individuals without (e.g., Burt, 2004). Based on insights from cognitive psychology, social network theory, creativity research and the concept of sticky information, we expect that a children’s position as a bridging link between two groups makes him or her more likely to be a lead user and to be more creative. Researchers in cognitive psychology generally agree that creativity consists in reassembling elements from existing knowledge bases in a novel fashion to produce a new idea (e.g., Ward, 1994; Holyoak & Thagard, 1995; Gentner, Holyoak & Kokinov, 2001). Therefore, the combination of diverse knowledge bases is often emphasized as a driver of truly innovative thought and radically new concepts (e.g., Ebadi & Utterback, 1984; Boden, 1994; Dahl & Moreau, 2002). Being the bridging link between two groups facilitates access to diverse knowledge bases and thus the development of radically new solutions. Burt (1992) argues that information access and control advantages are created when relations bridge between groups, which does not necessarily indicate a high number of direct contacts as shown in Figure 1. Actors with a social network bridging different groups monitor information more effectively, and they receive information faster (Staber, 2004). Information flowing in weakly connected networks tends to be less redundant and thus of greater value to individuals seeking new information (Staber, 2004). A weak tie has a greater chance of seeing good ideas and new opportunities (Staber, 2004). As Burt (2004) suggests, people who stand near the holes in a social structure have a greater propensity to have good ideas. The argument is that opinions and behaviours are more homogeneous within than between groups, so people connected across groups are more familiar with alterna-
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tive ways of thinking and behaving, which gives them more options to select from, interpret and synthesize. In addition, people whose networks bridge between groups have an advantage in detecting and developing rewarding opportunities. Information arbitrage is their advantage. They are able to see early and to see more broadly (Burt, 2004). Crossing group boundaries may also lessen the problem of sticky information (von Hippel, 1994; Lüthje, Herstatt & von Hippel, 2005). In any kind of situation, an individual operates in a particular communication environment consisting of a number of friends and acquaintances with whom a topic is discussed most frequently. These friends are usually highly similar with the individual and with each other, and most of the individual’s friends are friends of each other, thus constituting an interlocking network (Rogers, 1976). The similarity of individuals stimulates and facilitates effective communication inside such a network, but it acts like a barrier preventing new ideas from entering the network. Lüthje, Herstatt and von Hippel (2005) suggest that there is an information asymmetry which prevents the flow of information between distant units that may be caused by restricted absorptive capacities due to these information asymmetries. Individuals bridging groups may be able to interpret and process non-local and sticky information due to their permanent embeddedness in non-local network channels. The reasoning above leads us to two hypotheses. Hypothesis 1: The higher the betweenness centrality of a child in his/her social network, the more likely a child can be identified as a lead user. Hypothesis 2: The higher the betweenness centrality of a child in his/her social network, the higher is the creativity of a child. When following this discussion, the association between being a lead user and being creative becomes obvious. We assume that there is an interplay between both behaviours, because both require diverse knowledge, information advantages and bridging links to overcome communication barriers embedded in social networks. However, the extent to which someone can be characterized as a lead user requires more than scoring high in creativity and vice versa. According to von Hippel (1986), lead users are denoted by characteristics such as being ahead of a trend and recognizing expected benefits. These characteristics may also be determined by social networks but independent of individual creativity. Therefore, we are not proposing that © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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being creative and a lead user are one side of the same coin, but explore individual creativity and lead userness as possibly interlinked based on specific network constellations of individuals. It may even be that the children’s development of their cognitive capacity results first in certain personal characteristics such as lead userness and translates with increasing age into higher levels of creativity given a specific network constellation. However, this argument is rather speculative; therefore, we are not proposing any causal relationship between the two. The reasoning above leads us to the third hypothesis. Hypothesis 3: There is an interplay between the children’s creativity and the extent to which they can be identified as lead users.
Research Design Study Design, Procedure and Participants To address the hypotheses empirically, we gathered data in seven randomly selected schools in the Netherlands. Piaget (1971) and Roedder John (1999) emphasized the age of 7 years as a major cognitive turning point. Around this age children make the transition from pre-operational to the concrete operational and analytic stage. This implies that children around this age become better at logical, systematic thought using multiple pieces of information. In addition, language skills develop and children learn about classifications. Selman (1980), studying the social side of child development, describes this turning point at the age of 6 years and Valkenburg and Cantor (2001) state that this stage has already been reached by the age of 5 years. We decided to select children from 2-year groups orientating ourselves at the cognitive and social development of children as suggested by Piaget (1971), Roeddder John (1999), Selman (1980), Valkenburg and Cantor (2001), and a pragmatic point – the children had to be able to read and complete a questionnaire. A pre-test carried out during the ‘CineKid FilmFestival 2005’ in Amsterdam suggested that children younger than 7 years had some difficulty in reading and completing the questionnaires. We decided to use a cluster sample, grouping the children into two groups: ‘group 5’ (age 7/8) and ‘group 7’ (age 9/10). These groups also contained a small minority of children of other ages (up to age 12), as a result of recidivists. Moreover, in order to collect data about social networks, which are not ego-centred (Wasserman & Faust, 1994), the boundaries of the networks © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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have to be defined. As children spend the majority of their time in schools (around 6–8 hours a day in the Netherlands), we investigated full networks of school groups as suggested by Defares et al. (1971). The final cluster sample contained seven public primary schools, which means we had eight ‘group 5’ groups and eight ‘group 7’ groups. The total sample contained 366 children. The average size of a group was around 23 children.
Data Collection Collecting data from children is difficult because children’s interpretations of questions and definitions are often ambiguous. A child’s cognitive, communicative and social skills are still developing as he/she grows older, and this affects a child’s ability to answer survey questions (Borgers, 2004). To collect data about children’s social networks we therefore used a questionnaire and an experimental design. The questionnaires served to measure the extent to which the children could be identified as lead users and different control variables (the questionnaire was kept as clear and short as possible). The response rate was very high at 98 per cent. The children were asked to fill in the questionnaire one week before the experiment. During the experiment the children were asked to develop ideas improving an online application, labelled ‘CineKidStudio’, for their personal use. The online application is developed specifically for children aged 7–12 years and serves as a tool to develop different kinds of widely employed media content. This online application was introduced in advance of the experiment. A time-span of 25 minutes was set for idea development, and the children were allowed to interact with whomever and for as long as they wanted during this time. While the children were developing their ideas, the interactions were recorded by a research assistant using a matrix with all the names of the children. We also asked the children to note down their interactions during the experiment. The registrations of the children and the research assistant were very similar, so we decided to use the registration from the research assistant for our analyses, resulting in a list of all interactions taking place within all 16 groups. In addition, after the experiment, the ideas of all the children were evaluated by external experts who are familiar with this online application, and a number of ideas were considered to be potentially very valuable in improving the present version of this application.
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Operationalizations Measuring the Social Networks of the Children The data that were gathered during the experiment resulted in a matrix containing all interactions between the children from each group.2 These matrixes allowed calculation of the betweenness and degree centrality for each child in each group. (a) Betweenness Centrality Betweenness centrality may be defined loosely as the number of times that an actor needs a given actor to reach another actor or is reached by this actor. More precisely (but not quite correctly), it is the number of shortest paths (between all pairs of actors) that pass through a given actor in a network. This kind of centrality does not refer to the number of ties, but refers to the extent to which an actor facilitates the flow of information being positioned on many informational paths. In formal terms, betweenness centrality refers to the probability that a ‘communication’ from actor j to actor k takes a particular route. Here, it is assumed that lines have equal weight and communications will travel along the shortest routes, and therefore it is assumed that such a communication follows one of the geodesics (Wasserman & Faust, 1994). If Bjk is the proportion of all geodesics linking actor j and actor k, which pass through actor i, the betweenness of actor i is the sum of all Bjk where i, j and k are distinct (Borgatti, Everett & Freeman, 2002). So, holding a high degree of betweenness centrality does not refer to the number of direct contacts, but to the number of shortest paths that an actor facilitates. This measure, proposed by Freeman (1979), is calculated with UCINET VI (Borgatti, Everett & Freeman, 2002). (b) Degree Centrality Degree centrality is based on the number of units directly connected to the unit under scru2
In the questionnaire 1 week before the experiment, we measured the interaction networks of all groups using a sociometric method, called SAGS (Seracuse-Amsterdam-Groningen Sociometric Scale; Defares et al., 1971). The resulting networks from the questionnaire and the experiment correlate highly between 0.7 and 0.9 using QAP correlations. We decided to use the networks of the experiment for our analyses because in this way we could clearly separate the measurement of lead-user characteristics and idea-generation interaction. In addition, the results presented would not be different using the interaction matrixes based on the questionnaires.
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tiny. The definition of actor centrality is that the most central actor must be the most active, in the sense that this actor has the largest number of direct ties to other actors in the network (Freeman, 1979). In this way, it measures the balance between having a peripheral position or a small number of direct contacts or having a central position or a high number of direct contacts. The measure is focused on the level of communication activity for internal communication within the schoolgroups of the children. The degree centrality of each child is calculated using UCINET VI (Borgatti, Everett & Freeman, 2002). Among the proposed measures of positional centrality, degree centrality is the simplest and most straightforward (Zemljic & Hlebec, 2005). A typical interaction matrix of one group is displayed in Figure 2 using a sociogram. This sociogram illustrates that certain children score higher in betweenness centrality (e.g., numbers 18 and 22), others higher in degree centrality (e.g., numbers 11, 20 and 4), whereas certain children were extremely peripherally situated (e.g., numbers 21 and 23).
Lead Userness The item-batteries to identify the extent to which the children are lead users are derived from earlier studies. However, we had to exclude a number of items, because the cognitive capabilities of children disallowed using them, e.g., items about the monetary value of products. In addition, we had to minimize the number of items for the same reason. The pretest among 45 children justified our selections of items. Our final measure for lead userness consists of six indicators, measured on a 1-to-5 Likert-type scale. The indicators refer to the two characteristics of a lead-user suggested by von Hippel (1986). In addition, one indicator suggested by Lüthje and Herstatt (2004) was included, which refers to the dissatisfaction of a user with current market offerings. Translated into the world of children these indicators were: 1. I think that toys should be nicer and more advanced. (1 – always to 5 – never) 2. I invent toys myself. (1 – always to 5 – never) 3. I think I can better invent and advance toys than adults. (1 – always to 5 – never) 4. I invent new toys thinking that I will be somehow rewarded for it. (1 – always to 5 – never) 5. I am normally the first to adapt new toys. (1 – always to 5 – never) 6. I would prefer to be the only one having new toys. (1 – always to 5 – never) © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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Figure 2. A Typical Social Network of a Group of Children The scale achieved a Cronbach’s alpha value of 0.83, which implies that the internal consistency was high enough to combine the indicators into a single measure of lead userness.
Creativity Measuring creativity is notoriously difficult. In the majority of creativity studies, creativity is measured in one of two ways. First, by the performance of (groups of) individuals on standardized creativity tests – constructed and scored similarly to tests of verbal and mathematical intelligence. Alternatively, a second group of measures entails the rating of actual products in response to open-ended instructions. Rating is then performed by outside experts. Since we could not apply standardized creativity tests, we asked external experts. These external experts were leading employees of the organization who develops and sells the online application the children were asked to improve with their ideas. The evaluation was based for each child on (a) idea quality and (b) idea quantity on a scale from 1 – very high to 7 – very low. We oriented our measurement of creativity on the nature of the design process itself, assuming that originality and number of problem solutions generated and © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
considered directly affect the usefulness and originality of outcomes. These assumptions are supported by modern design literature (e.g., Pahl & Beitz, 1992; Dym, 1994). The two evaluation scales were combined into one scale for creativity.
Control Variables There are many other factors that have been shown to or may be affecting behavioural effects embedded in social networks. While it is not possible to include all other variables in this study, we chose to include two variables that have been suggested to affect most prominently the social networks of children. First, we included gender because boys and girls express and satisfy their needs and feelings differently (Del Vecchio, 2002). In addition, Kalmijn (2003) reports that gender influences social networks, since women are likely to have more frequent contacts with friends than men do. This variable is included as a dummy, where male = 0 and female = 1. Second, we included age because children of different ages have diverse likes and dislikes: as a child grows older the thoughts, expectations and feelings of a child change (Craig & Baucum, 2003). Additionally, research shows that social
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Table 1. Descriptive and Correlation Coefficientsa Variables
Mean
SD
2
3
4
5
6
1. 2. 3. 4. 5. 6.
3.82 2.61 0.53 10.05 37.02 17.40
1.19 0.82 0.51 1.21 9.52 21.11
0.64** –
0.14 -0.13 –
0.30** 0.09 -0.15 –
0.03 0.29** -0.14 0.23* –
0.53** 0.67** -0.09 0.11 0.37** –
a
Creativity Lead userness Gender Age Degree centrality Betweenness centrality
Two-tailed tests are reported; * p < 0.05, ** p < 0.01.
Table 2. Multiple Regressions – Lead Usera Variables Constant Gender Age Degree centrality Betweenness centrality Adjusted R2 (sig. of change)
Model 1
Model 2
Model 3
2.56** -0.17 0.01
2.72** -0.14 -0.06 0.04*
0.01
0.06
3.583** 0.01 -0.06 -0.01 0.42** 0.45**
a
Unstandardized coefficients are shown (standard errors in parentheses). Two-tailed tests are reported; * p < 0.05, ** p < 0.01.
networks are not stable over time. Stages in the life course will influence the social networks of actors (Kalmijn, 2003).
Analyses To test Hypotheses 1 and 2, we carried out multiple regressions as illustrated in Tables 2 and 3. Both tables show three models presenting a stepwise approach of, first, entering the control variables as baseline model, second, entering degree centrality in Model 2 and, finally, entering betweenness centrality in Model 3. We use this stepwise procedure to present separately the effects of the control and the two independent variables. All models were tested for violations of multicollinearity by checking the VIF (variable inflation factor) and CI (condition index) and the distribution of residuals. The distribution of betweenness centrality was moderately right skewed so we transformed this variable, using the natural logarithm, achieving a normal distribution. The descriptive information about all the relevant variables are presented in Table 1. Table 1 is also used to test Hypothesis 3.
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Results Table 1 shows that creativity, lead userness and betweenness centrality are positively correlated. All these results are statistically significant. Creativity and lead userness correlate moderately highly with r = 0.64, so that we find support for Hypothesis 3. This correlation shows that there is an interplay between lead userness and creativity: children who are more creative also tend to score higher on lead user characteristics and vice versa. In Table 1 lead userness also correlates positively with degree centrality. This correlation is also statistically significant. Age correlates positively and statistically significantly with creativity and degree centrality as Table 1 illustrates. Finally, there is a positive correlation between degree centrality and betweenness centrality at a statistically significant level. In Table 2 the results with respect to lead userness are presented. Neither gender nor age have any statistically significant impact on lead userness. This situation changes in Model 2 when degree centrality is entered. However, the explained variance of Model 2 at 6 per cent © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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Table 3. Multiple Regressions – Creativitya Variables Constant Gender Age Degree centrality Betweenness centrality Adjusted R2 (sig. of change)
Model 1
Model 2
Model 3
5.32** -0.11 0.34**
4.76** -0.09 0.32** 0.01
0.07
0.11
4.31** -0.09 0.32** 0.02 1.03** 0.28**
a
Unstandardized coefficients are shown (standard errors in parentheses). Two-tailed tests are reported; * p < 0.05, ** p < 0.01.
is still fairly low even though degree centrality affects lead userness at a statistically significant level. In Table 2 Model 3, the positive effect of degree centrality on lead userness loses statistical significance, whereas betweenness centrality achieves statistical significance. As Model 3 shows, betweenness centrality is positively related to lead userness and increases the explained variance from 6 to 42 per cent. As illustrated in Table 3 Model 1, age positively impacts creativity statistically significantly, but only explains 7 per cent of variance. Degree centrality and betweenness centrality are stepwise entered in Models 2 and 3 to separate out their effects. As Model 2 shows, degree centrality does not impact creativity at a statistical significant level, whereas including betweenness centrality yields a statistically significant effect on creativity and increases the explained variance from 11 to 28 per cent. This increase is also statistically significant. In summarizing the results, the following three points can be made. First, the correlations between creativity and lead userness shown here support Hypothesis 3. Second, both creativity and lead userness are positively influenced by betwenness centrality. These results support Hypotheses 1 and 2. Third, in contrast to lead userness, creativity is positively impacted by age.
Discussion and Conclusions Children are increasingly interesting as a market, but also as subjects for creating ideas at the ‘fuzzy front end’ of product development. Since children lack past experience and well-established cues about existing products, the interpersonal exchange of information among them is extraordinarily important for them. Therefore, the perspective of social net© 2008 The Authors Journal compilation © 2008 Blackwell Publishing
works allows crucial insights into children’s lead userness and creativity. This study attempts to reveal these patterns and finds the following results. First, lead users can be found in the network role of betweenness centrality. This means lead users are bridges between cliques/clusters of people. Having this ‘boundary spanning’ position also entails having a wider reach and variety of obtaining information and overcoming communicational barriers. In this way, lead users may have a very sensitive but key position in social networks of consumers; namely, they make it possible to link people of distant clusters, translating information asymmetries into symmetries. Using this information advantage, lead users are able to and can be utilized to create highly novel ideas in the ‘fuzzy front end’ of new product development. The second result is that betweenness centrality also determines the creativity of children in our sample. Similar to the effect on lead users, creativity is stimulated by a high informational diversity, by structural holes and by minimizing communication barriers. Thus, children exposed to this information advantage show lead user characteristics such as being ahead of a trend or recognizing the benefits of new ideas earlier than the majority, and at the same time they are capable of developing highly novel ideas in a creative process. Our third result is that, not very surprisingly, we found that being creative and lead user correlate positively with each other. However, this result can only be regarded as a first step to integrate lead user theory and creativity research based on social networks. There is a circulation of a whole variety of different information in social networks. This different information may, on the one hand, stimulate characteristics of being ahead of trends and recognizing benefits in creating ideas, while on the other, also increasing the likelihood of creating many and highly quali-
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tative ideas. Based on our results we are unable to pose any causal relationship between lead user and creativity. Which is the chicken and which the egg cannot be clarified because lead user characteristics and creativity exist in a circle of cause and effect. Children who stay in a favourable network position may develop lead user characteristics, which in turn stimulate them to utilize the information advantage and to be creative. Alternatively, the favourable network position may also cause individual creativity resulting in developing lead user characteristics. Another interesting outcome of this study is that the social structure of lead users can be identified independently of the age or gender of the examined children. In contrast, age influences creativity, so with increasing age and cognitive capacity, children are able to develop more and better ideas. This result is a weak indication that children first develop lead user characteristics, which translate into increasing levels of creativity with increasing age. The managerial implications of these findings are manifold. The most important implication is that markets for children are segmented into children who are at the leading edge of product-relevant knowledge and capabilities of being creative and children who are not. Involving children and smoothing idea generation at the ‘fuzzy front end’ raises the question what kind of children are appropriate. Our study implies the selection of children with diverse networks rather than children who are only locally embedded. There may be different methods of selecting particularly appropriate children, using selfreports, parents or teachers as information source. For example, as we came to realize during our research, teachers are able to rank their pupils according to their information diversity. Like many studies, this study also has shortcomings. The study is one of the first to investigate social networks of children, which is not a deficiency in itself, but restricts our ability to generalize the results. Further research needs to apply the social network perspective to lead users as adults. To better understand the social network structures of lead users is an important, yet underdeveloped area in lead user innovation research. The embeddedness in social networks is an ever-changing process throughout the life course, and it may be that the behavioural effects of social networks may change as well. This also leads to another suggestion for future research. Social networks are dynamic, so in order to trace and follow individual changes in network configurations over a lifetime, longitudinal research designs are required. Longitudinal research would
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also make it possible to clarify the ‘chicken and egg’ problem about lead userness and creativity. The third deficiency can be derived from our study. The sample was restricted in number and to networks of certain school groups, so future research may go a step further in studying social networks of children in a more multi-faceted way. One option for a follow-up study would be to carry out research in Montesori or Jenaplan schools, were children of different ages stay together in one group. Our study is focused on children and, as such, we avoid drawing explicit predictive or prescriptive conclusions for an adult population. However, we believe that our research effort contributes to different research fields, including ‘adult’ research, by integrating for the first time such widely separated streams as lead user theory, creativity research and network theory.
References Amabile, T.M. (1988) A Model of Creativity and Innovation in Organizations. Research in Organizational Behavior, 10, 123–67. Bandura, A. (2001) Social Cognitive Theory of Mass Communication. Media Psychology, 3, 265–99. Boden, M.A. (1994) Dimensions of Creativity. MIT Press, Cambridge, MA. Borgatti, S.P., Everett, M.G. and Freeman, L.C. (2002) Ucinet 6 for Windows. Analytic Technologies, Harvard, Cambridge, MA. Borgers, N. (2004) Questioning Children’s Responses. NUGI, Amsterdam. Burt, R. (1992) Structural Holes: The Social Structure of Competition. Harvard University Press, Cambridge, MA. Burt, R. (2004) Structural Holes and Good Ideas. American Journal of Sociology, 110, 349–99. Craig, G.J. and Baucum, D. (2003) Human Development, 9th edn. Prentice Hall, Upper Saddle River, NJ. Csikszentmihalyi, P. and Sawyer, K. (1995) Shifting the Focus from Individual to Organizational Creativity. In Ford, C.M. and Goia, D.A. (eds.), Creative Action in Organizations. Sage, Thousand Oaks, CA, pp. 167–73. Dahl, D.W. and Moreau, P. (2002) The Influence and Value of Analogical Thinking during New Product Ideation. Journal of Marketing Research, 34, 47–60. Defares, P.B., Kema, G.N., Van Praag, E. and Van der Werf, J.J. (1971) Syracuse-Amsterdam-Groningen Sociometric Scale. Annual Report University of Groningen (the Netherlands). Del Vecchio, G. (2002) Creating Ever-Cool: A Marketer’s Guide to a Kid’s Heart, 3rd edn. Pelican, Louisiana. Derbaix, C. and Vanhamme, J. (2003) Inducing Word-of-Mouth by Eliciting Surprise – A Pilot Investigation. Journal of Economic Psychology, 24, 99–116. © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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Dym, C.L. (1994) Engineering Design: A Synthesis of Views. Cambridge University Press, Cambriodge. Ebadi, Y.M. and Utterback, J.M. (1984) The Effects of Communication on Technological Innovation. Management Science, 30, 572–85. Franke, N. and Shah, S. (2003) How Communities Support Innovative Activities: An Exploration of Assistance and Sharing among End-Users. Research Policy, 32, 157–78. Franke, N. and von Hippel, E. (2003) Satisfying Heterogeneous User Needs via Innovation Toolkits: The Case of Apache Security Software. Research Policy, 32, 1199–215. Franke, N., von Hippel, E. and Schreier, M. (2006) Finding Commercially Attractive User Innovation: A Test of Lead-User Theory. Journal of Product Innovation Management, 23, 301–15. Freeman L.C. (1979) Centrality in Social Networks: Conceptual Clarification. Social Networks, 1, 215– 39. Gentner, D., Holyoak, K.J. and Kokinov, B.N. (2001) The Analogical Mind: Perspectives from Cognitive Science. MIT Press, Cambridge, MA. Granovetter, M. (1973) The Strength of Weak Ties. American Journal of Sociology, 78, 1360–80. Hanson, W.A. and Putler, D.S. (1996) Hits and Misses: Herd Behavior and Online Product Popularity. Marketing Letters, 7, 297–305. Harhoff, D., Henkel, J. and von Hippel, E. (2003) Profiting from Voluntary Spillovers: How Users Benefit from Freely Revealing Their Innovations. Research Policy, 32, 1753–69. Holyoak, K.J. and Thagard, P.R. (1995) Mental Leaps. MIT Press, Cambridge, MA. Jeppesen, L.B. and Molin, M.J. (2003) Consumers as Co-developers: Learning and Innovation outside the Firm. Technology Analysis & Strategic Management, 15, 363–84. Kalmijn, M. (2003) Shared Friendship Networks and the Life Course: An Analysis of Survey Data on Married and Cohabiting Couples. Social Networks, 23, 231–49. Krackhardt, D. and Holly, R. (2002) Festschrift for Linton C. Freeman: Introduction. Social Networks, 24, 311–14. Kratzer, J., Leenders, R.Th.A.J. and van Engelen, J.M.L. (2004) Stimulating the Potential: Creativity and Performance in Innovation Units. Creativity and Innovation Management, 13, 63–70. Kunst, L. and Kratzer, J. (2007) Diffusion of Innovation through Social Network of Children. Young Consumers, 8, 36–51. Leenders, R.T.A.J., Van Engelen, J.M.L. and Kratzer, J. (2003) Virtuality, Interaction, and New Product Team Creativity: A Social Network Perspective. Journal of Engineering and Technology Management, 20, 69–92. Leenders, R.T.A.J., Van Engelen, J.M.L. and Kratzer, J. (2007) Systematic Design Methods and the Creative Performance of New Product Teams: Do They Contradict or Complement Each Other? Journal of Product Innovation Management, 24, 166– 79. Leonard, D. and Rayport, J. (1997) Spark Innovation through Emphatic Design. Harvard Business Review, 75, 102–12.
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Lettl, C., Herstatt, C. and Gemuenden, H.G. (2006) Users’ Contributions to Radical Innovation: Evidence from Four Cases in the Field of Medical Equipment Technology. R&D Management, 36, 251–72. Lilien, G., Morrison, P.D., Searls, K., Sonnak, M. and von Hippel, E. (2002) Performance Assessment of the Lead User Generation Process for New Product Development. Management Science, 48, 1042–59. Lüthje, C. and Herstatt, C. (2004) The Lead User Method: An Outline of Empirical Findings and Issues for Future Research. R&D Management, 34, 553–68. Lüthje, C., Lettl, C. and Herstatt, C. (2003) Knowledge Distribution among Market Experts: A Closer Look into the Efficiency of Information Gathering for Innovation Projects. International Journal of Technology Management, 26, 561– 77. Lüthje, C., Herstatt, C. and von Hippel, E. (2005) User-Innovators and ‘Local’ Information: The Case of Mountain Biking. Research Policy, 34, 951– 65. McNeal, J. (1992) Kids as Consumers. Lexington, New York. Morrison, P.D., Roberts, J.H. and Midgley, D.F. (2000) Determinents of User Innovation and Innovation Sharing in a Local Market. Management Science, 46, 1513–27. Pahl, G. and Beitz, W. (1992) Engineering Design: A Systematic Approach. Springer, Berlin. Piaget, J. (1971) Psychology and Epistemology: Towards a Theory of Knowledge. Viking Press, New York. Riggs, W. and von Hippel, E. (1994) Incentives to Innovate and the Sources of Innovation: The Case of Scientific Instruments. Research Policy, 23, 459– 69. Roedder John, D. (1999) Consumer Socialization: A Retrospective Look at Twenty-Five Years of Research. Journal of Consumer Research, 26, 183– 213. Rogers, E.M. (1976) New Product Adoption and Diffusion. Journal of Consumer Research, 2, 290– 301. Rosen, E. (2000) The Anatomy of Buzz: How to Create Word-of-Mouth Marketing. HarperCollins, London. Schreier, M., Oberhauser, S. and Prügl, R. (2007) Lead Users and the Adoption and Diffusion of New Products: Insights from Two Extreme Sport Communities. Marketing Letters, 18, 15–30. Selman, R.L. (1980) The Growth of Interpersonal Understanding. Academic Press, New York. Srinivasan, V., Lovejoy, W.S. and Beach, D. (1997) Integrated Product Design for Marketability and Manufacturing. Journal of Marketing Research, 34, 154–63. Staber, U. (2004) Networking beyond Organizational Boundaries: The Case of Project Organizations. Creativity and Innovation Management, 13, 30–40. Ulrich, K.T. and Eppinger, S.D. (2000) Product Design and Development, 2nd edn. McGraw-Hill, New York.
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Urban, G. and von Hippel, E. (1988) Lead User Analyses for the Development of New Industrial Products. Management Science, 35, 569–82. Valkenburg, P.M. and Cantor, J. (2001) The Development of a Child into a Consumer. Applied Developmental Psychology, 22, 61–72. von Hippel, E. (1986) Lead Users: A Source of Novel Product Concepts. Management Science, 32, 791– 805. von Hippel, E. (1994) ‘Sticky Information’ and the Locus of Problem Solving: Implications for Innovation. Management Science, 40, 429–39. von Hippel, E. (2005) Democratizing Innovation: Users Take Center Stage. MIT Press, Boston, MA. Ward, T.B. (1994) Structured Imagination: The Role of Category Structure in Exemplar Generation. Cognitive Psychology, 27, 1–40. Wasserman, S. and Faust, K. (1994) Social Network Analysis. Cambridge University Press, New York. Zemljic, B. and Hlebec, V. (2005) Reliability of Measures of Centrality and Prominence. Social Networks, 27, 73–88.
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Dr Jan Kratzer (
[email protected]) is an Associate Professor of Business Development at the Faculty of Business and Economics of the University of Groningen, the Netherlands. His research is mainly on the communication patterns within new product development teams and projects, the development of social network measures, open innovation networks, and the embeddedness of marketing roles in social networks. His work has appeared in Journal of Product Innovation Management, Research-Technology Management, Technovation, Journal of Mathematical Sociology, Journal of Engineering and Technology Management, and Creativity and Innovation Management. He has authored two books, Communication and Performance: An Empirical Study in Innovation Teams, and InnovationNet©: The Art of Creating and Benefiting from Innovation Networks (with R.T.A.J. Leenders, J.M.L. van Engelen and L. Kunst). Dr Christopher Lettl (
[email protected]) is Professor of Technology and Innovation Management at the Aarhus School of Business, University of Aarhus, Denmark. He specializes in user-based innovation, open innovation, market-oriented new product development and entrepreneurial aspects of innovation. His work has appeared in IEEE Transactions on Engineering Management, R&D Management, Schmalenbach Business Review (German Version), International Journal of Technology Management, Journal of Engineering and Technology Management, Journal of Business and Industrial Marketing, Creativity and Innovation Management, among others.
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Creative Potential and Practised Creativity: Identifying Untapped Creativity in Organizations Trudy C. DiLiello and Jeffery D. Houghton This study examines the construct validity of creative potential and practised creativity, two overlooked aspects of creativity that may be useful for identifying untapped creative resources in organizations. Results of an exploratory factor analysis (EFA) and a confirmatory factor analysis (CFA) utilizing structural equation modelling techniques provide some initial evidence in support of the construct validity of these concepts. These findings appear to have important managerial implications for increasing creativity and overall organizational effectiveness. The results presented here also suggest some directions for future research aimed at examining the relationships between creative potential, practised creativity and other variables of interest.
C
reativity and innovation are critical competencies for 21st-century organizations seeking to lead or adapt to change (Amabile, 1988; Woodman, Sawyer & Griffen, 1993). Individual creativity is often presented as an essential component for facilitating organizational innovation (Amabile, 1988; Woodman, Sawyer & Griffen, 1993), which generally refers to the implementation of creative ideas in an organizational context and is imperative for long-term organizational success and survival (Kanter, 1983; Utterback, 1994; Amabile et al., 1996; Tushman & O’Reilly, 1997). However, creativity is an elusive and complex construct that is somewhat difficult to define. Although theorists do not entirely agree upon a single definition, consistent concepts appear across most existing definitions. Guilford (1950) stated that ‘the creative person has novel ideas’ and will submit ‘uncommon, yet acceptable, responses’ (p. 452). Likewise, Sternberg and Lubart (1999) define creativity as ‘the ability to produce work that is both novel (i.e., original, unexpected) and appropriate (i.e., useful, adaptive concerning task constraints)’ (p. 3). Similarly, Barron and Harrington (1981) use the terms ‘novel’, ‘originality’, and ‘far-reachingness’ in their definition of creativity (p. 442). Finally, Martindale (1989) suggested that creativity ‘must be original, it must be useful or appropriate for the situation © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
. . . and it must actually be put to some use’ (p. 211). Given the common themes across these definitions, it appears that the value of creativity in organizations may relate to an ability to harvest novel yet appropriate ideas in order to increase organizational efficiencies, solve complex problems and improve overall effectiveness. The United States Department of Defense (DoD) is an example of an organization that acknowledges the importance of leveraging the creativity of workforce members in order to transform its culture and business practices. The DoD’s ability to fulfil its mission of averting enemy terrorization depends in large part on the extent to which it can develop new capabilities. The DoD has acknowledged the importance of change within the military and supporting organizations. Indeed, creativity and innovation have been identified by the Office of the Secretary of Defense (OSD) as ranking among the most effective means for facilitating the changes necessary for maintaining a competitive advantage. In this article we examine two somewhat overlooked aspects of creativity, creative potential and practised creativity, that may be useful for identifying untapped creative resources in competitive organizations like the DoD. Thus, the primary purpose of the present study is to examine the construct validity of
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creative potential and practised creativity using an exploratory factor analysis (EFA) along with a confirmatory factor analysis (CFA) utilizing structural equation modelling techniques. We will also examine the discriminant validity (e.g., Campbell & Fiske, 1959) of these constructs relative to the similar construct of organizational support for creativity. We first review several key dimensions of creativity before narrowing our focus to the concepts of creative potential and practised creativity. We then examine the construct validity of these concepts using data gathered within one strategic command of the DoD. We conclude with a discussion of the implications of our findings and make some suggestions for future research. The current study has the potential to serve as a catalyst for future research examining the relationships between creative potential, practised creativity and other variables of interest by providing an initial reliability assessment of items intended to measure these constructs.
Key Creativity Dimensions Individual creativity has been measured in a number of different ways, ranging from the assessment of the characteristics and personality traits of highly creative individuals to the measurement of creative products and achievements. A number of models based on comprehensive reviews of creativity theory and research have been developed that describe individual creativity dimensions (e.g., Amabile, 1988; Woodman & Schoenfeldt, 1989; Ford, 1996). Knowledge, divergent thinking (cognitive style), personality, autonomy and intrinsic motivation are recurring factors in each of these models. In particular, research findings suggest that domainspecific knowledge is a necessary prerequisite for effective creative functioning (Weisberg, 1999). Essential knowledge and information is often embedded in social networks, which become important components in facilitating individual creativity (Kijkuit & van den Ende, 2007; Leenders, van Engelen & Kratzer, 2007). The knowledge aspect of creativity has been assessed directly by measures such as intelligence tests (Brown, 1989) and indirectly by factors such as years of education (Simonton, 1992). Likewise, Hocevar and Bachelor (1989) include divergent thinking (cognitive style) and personality inventories as two of the eight categories they used for classifying over 100 measures of creativity. The concept of autonomy, as it relates to creativity, has been studied primarily in the context of work environment assess-
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ments (e.g., Amabile et al., 1996; Cummings & Oldham, 1997; Shalley, Gilson & Blum, 2000). Intrinsic motivation is another key concept that may be related to creativity (e.g., Maslow, 1970; Deci & Ryan, 1985; Amabile et al., 1994; Deci & Flaste, 1995; Bandura, 1997; Herzberg, Mausner & Snyderman, 2003). Some research has suggested that creativity may be positively related to intrinsic motivation and negatively related to extrinsic motivation (e.g., Amabile et al., 1994). Several key factors may influence intrinsic motivation including selfdetermination (e.g., Deci & Ryan, 1985), competence (e.g., Bandura, 1997), autonomy (e.g., Hackman & Oldham, 1975; Cummings & Oldham, 1997; Shalley, Gilson & Blum, 2000), challenge (e.g., Locke et al., 1984; Bandura, 1997; Shalley, Gilson & Blum, 2000), task involvement (e.g., Hackman & Oldham, 1975; Csikszentmihalyi, 1996) and interest (e.g., Bandura, 1997). Additionally, Tierney and Farmer (2002) have suggested that creative self-efficacy, defined as ‘the belief one has the ability to produce creative outcomes’ (p. 1138), is another key factor influencing intrinsic motivation and creativity. In contrast, certain extrinsic factors have been posited to restrict creative performance by undermining intrinsic motivation. These factors include an expected evaluation (Amabile, 1979; Shalley & Oldham, 1985; Shalley, Oldham & Porac, 1987; Shalley, 1995), a contracted-for reward (Amabile, Hennessey & Grossman, 1986), restricted choice (Amabile & Gitomer, 1984), surveillance, unrealistic deadlines, competition (Amabile, 1982, 1985, 1988; Deci & Ryan, 1985; Shalley & Oldham, 1997) and goal setting (Shalley, Oldham & Porac, 1987; Shalley, 1995). Of the extrinsic motivators thought to undermine creativity, the effects of both expected evaluation and rewards on creativity appear to be particularly complex. Indeed, research examining the relationship between expected evaluation and creativity has yielded somewhat inconsistent results (Amabile, 1996). Task complexity (Shalley & Oldham, 1985), the level of task motivation, the amount of time spent on a creative project, the individual’s personality, the type of pre-task activity, the individual skill level (Amabile, 1996) and the goal-setting method (Shalley, 1995; Shalley, Oldham & Porac, 1987) may all affect the impact of expected evaluation on creativity. Furthermore, research suggests that when evaluation is work-focused, constructive, and ‘conveys positive recognition of competence and valued work’ (Amabile, 1996, p. 152), creativity may actually be enhanced. Much like the findings on expected evaluation, the use of rewards in the context of creativity has also resulted © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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in inconsistent findings (Eisenberger & Cameron, 1998). For instance, some research suggests that competency-based rewards may not necessarily undermine creativity because this type of reward may be viewed as a tribute to one’s skills and abilities rather than as an inducement to complete the given task (e.g., Rosenfield, Folger & Adelman, 1980). Research also suggests that when intrinsically motivated people are able to work in an environment that allows them autonomy and includes challenging activities, they are likely to be more involved (Csikszentmihalyi, 1996; Bandura, 1997) and more creative (Deci & Ryan, 1985; Eisenberger, Fasolo & DavisLaMastro, 1990; Amabile et al., 1994; Shalley, 1995; Cummings & Oldham, 1997). In addition, people tend to produce more creative work when they perceive encouragement from management to solve problems creatively (Amabile et al., 1996, Tierney & Farmer, 2004). The work environment, as perceived by the individuals in the workplace, is perhaps the most critical influence in determining the ultimate creativity of those individuals (Amabile, Burnside & Gryskiewicz, 1999). In summary, it seems fair to suggest that creativity is more likely to occur when an individual has certain characteristics or innate skills and abilities (e.g., Hinton, 1970; Woodman & Schoenfeldt, 1989; Simonton, 1992; Tierney & Farmer, 2002), has domain specific knowledge embedded within social networks (e.g., Weisberg, 1999; Kijkuit & van den Ende, 2007; Leenders, van Engelen, & Kratzer, 2007), is intrinsically motivated (e.g., Amabile et al., 1994), and perceives a work environment that supports creativity (Cummings, Hinton & Gobdel, 1975; Woodman, Sawyer & Griffen, 1993; Amabile, 1996). In short, creativity is a complex construct with multiple dimensions that must be carefully assessed in order to create a true and accurate composite of an individual’s creative capacity (cf. Woodman & Schoenfeldt, 1989; Feldhusen & Goh, 1995).
Creative Potential and Practised Creativity Almost four decades ago, Hinton (1968) noted an important distinction between creative potential and actual creative output. Hinton suggested that if the individual’s creative output is inhibited by the environment then the individual will not be able to utilize his/her creative potential (Scott, 1965; Hinton, 1968; George & Zhou, 2001). Moreover, this inability to utilize creative potential will most likely go unnoticed because there will be nothing to measure or observe (Hinton, 1968). Unfortu© 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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nately, little attention has been paid to this distinction over the years since Hinton’s original observations. Although Tierney and Farmer (2002) recently presented a measure of creative self-efficacy that assesses a portion of the distinction that Hinton identified, little or no empirical research has examined the concepts of creative potential and practised creativity. Creative potential may be defined as the creative capacity, skills and abilities that the individual possesses (Hinton, 1968, 1970). In contrast, practised creativity may be defined as the perceived opportunity to utilize creativity skills and abilities on the job (DiLiello & Houghton, 2006). Practised creativity is different from creative performance, which is measured externally by products or achievements that can be assessed or observed (Hinton, 1968; Amabile, 1996). Practised creativity is also distinct from the related concept of organizational support for creativity, which has been defined as ‘an organizational culture that encourages creativity through the fair, constructive judgement of ideas, reward and recognition for creative work, mechanisms for developing new ideas, and active flow of ideas, and a shared vision of what the organization is trying to do’ (Amabile, Burnside & Gryskiewicz, 1999, p. 15). A number of important conditions must be present within an organization for its work environment to support individual creativity (e.g., Amabile, 1988; Mumford & Gustafson, 1988; Ford, 1996) and employees with strong creative potential are more likely to actually practise creativity when they perceive strong support from the organization (DiLiello & Houghton, 2006). When individuals in the workplace perceive themselves as having creative potential but do not perceive the ability to use or practise this potential, then important untapped organizational resources may exist. Being able to identify these untapped resources may be especially beneficial in many organizations in which people are continually being told to ‘do more with less’. Among other implications, the ability to use one’s creative skills and abilities in the workplace may contribute to job satisfaction and increased retention (e.g., Shalley, Gilson & Blum, 2000). In addition, the organization reaps the benefits of the individual’s creative ideas, making the work environment a fertile place to grow, learn and work.
Method Sample and Procedure Primary data were collected from the US Army Contracting Agency (ACA), a strategic
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command of the United States Department of Defense, utilizing a web-based survey. The data were gathered as part of a larger study examining a number of creativity-related issues within the ACA. The entire ACA workforce of approximately 1,900 was invited to participate. The total number of respondents to the survey was 693, yielding a response rate of approximately 37%. This response rate was above average compared with previous response rates for federal employee surveys and with response rates for e-mail surveys in general (Sheehan, 2001). The Tailored Design Method (Dillman, 2000) was used to deploy the online survey. Two e-mails were sent to the ACA workforce. The first e-mail included an informed consent notification, the purpose of the study, the approval and sponsorship of the study, confidentiality statement and a link to the online survey. The second e-mail served as a reminder. The reminder e-mail summarized the initial message, added a personal note and provided a four-day extension and a link to the online survey. A response rate check indicated a fairly representative percentage response from each of nine regional offices within the ACA with no indications of any type of systematic non-response bias. The average age of the respondents was approximately 46 and the average job tenure was approximately 12 years. Sixty per cent of the respondents were female. Cases were randomly selected and split into two subsamples. Subsample 1 was used to conduct an exploratory factor analysis and to perform a reliability analysis. Subsample 2 was used to conduct a confirmatory factor analysis using structural equations modelling techniques. List-wise deletion for missing data resulted in final sample sizes of 327 and 335 for subsamples 1 and 2, respectively.
Measures Creative Potential Six survey items were used to measure creative potential (see Table 1). Creative potential consists in part of personal feelings regarding the ability to be creative, what Tierney and Farmer (2002) call creative self-efficacy. Creative self-efficacy includes feeling good at generating novel ideas, having confidence in one’s ability to solve problems creatively, having the knack for developing others’ ideas, and finding creative ways to solve problems. Thus, items 1–4 were used with permission from Tierney and Farmer (2002) in order to measure the creative self-efficacy component of creative potential. The remaining two survey items (5 and 6) were developed to reflect two other important aspect of creative
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potential: having the talent or expertise to do well in one’s work and possessing the ability to take risks by trying out new ideas (cf. Amabile, Burnside & Gryskiewicz, 1999). All items were measured using a five-point Likert-type scale ranging from Strongly Agree to Strongly Disagree. Practised Creativity Existing individual creativity theory was utilized to operationalize the concept of practised creativity. Based on the distinctions identified by Hinton (1968, 1970), five survey items (7–11) were developed that describe a variety of opportunities in the workplace to use one’s expertise, creativity skills and abilities (see Table 1). All items were measured using a fivepoint Likert-type scale ranging from Strongly Agree to Strongly Disagree. Perceived Organizational Support Perceived organizational support was measured for the purpose of assessing the discriminant validity of the practised creativity construct. Six survey items from ‘Keys: Assessing the Climate for Creativity’ were used with permission from the Center for Creative Leadership (Amabile, Burnside & Gryskiewicz, 1999) to represent perceived organizational support (see Table 1). All items were measured using a five-point Likert-type scale ranging from Strongly Agree to Strongly Disagree.
Results Exploratory Factor Analysis: Subsample 1 An exploratory factor analysis (EFA) with principal components extraction and varimax rotation was performed on the 17 items intended to measure creative potential, practised creativity and organizational support for creativity utilizing the data from Subsample 1. A critical value of 0.40 was chosen as the cutoff point in determining whether an item defined a factor and the ‘eigenvalue greater than one test’ and the scree test were used to define factors (Gorsuch, 1974). As anticipated, three interpretable factors emerged as shown in Table 1. Each of the three factors demonstrated good scale reliability with coefficient alphas of 0.84, 0.84 and 0.94, respectively. All factor loadings exceeded 0.40 and all items loaded unambiguously on the correct factors with no cross-factor loadings greater than 0.40.
Confirmatory Factor Analysis: Subsample 2 In order to further assess construct validity, a confirmatory factor analysis (CFA) was © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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Table 1. Exploratory Factor Analysis Results (Subsample 1 Data) Factor loadings
1
Factor 1: Creative Potential Scale a = 0.84 1. I feel that I am good at generating novel ideas. 2. I have confidence in my ability to solve problems creatively. 3. I have a knack for further developing the ideas of others. 4. I am good at finding creative ways to solve problems. 5. I have the talent and skills to do well in my work. 6. I feel comfortable trying out new ideas. Factor 2: Practised Creativity Scale a = 0.84 7. I have opportunities to use my creative skills and abilities at work. 8. I am invited to submit ideas for improvements in the workplace. 9. I have the opportunity to participate on team(s). 10. I have the freedom to decide how my job tasks get done. 11. My creative abilities are used to my full potential at work. Factor 3: Perceived Organizational Support Scale a = 0.94 12. People are recognized for creative work in this organization. (KEYS-35) 13. Ideas are judged fairly in this organization. (KEYS-42) 14. People are encouraged to solve problems creatively in this organization. (KEYS-49) 15. This organization has a good mechanism for encouraging and developing creative ideas. (KEYS-61) 16. People are encouraged to take risks in this organization. (KEYS-62) 17. Rewards are given for innovative and creative ideas.
2
3
0.776 0.842 0.648 0.833 0.685 0.671
0.700 0.744 0.707 0.660 0.712
0.859 0.852 0.801 0.864 0.739 0.844
Note: N = 327. Extraction Method: Principal Component Analysis. Rotation Method: Varimax with Kaiser Normalization.
performed on the data from subsample 2 utilizing LISREL 8 (Jöreskog & Sörbom, 1993). More specifically, three competing models were examined. Model 1 consisted of all items loading onto a single creativity factor. Model 2 specified the loading of the first six items onto a creative potential factor and the remaining items, including the six perceived organizational support items, onto a second ‘organizational creativity’ factor. Model 3 contained three factors: creative potential, practised creativity and perceived organizational support for creativity, with individual items loading onto the factor they are purported to measure. An increase in fit from Models 1–3 would provide evidence in support of the construct validity of creative potential and practised creativity, as well as support for the discriminant validity of practised creativity relative to perceived organizational support for creativity. © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
In accordance with the recommendations of Hoyle and Panter (1995), the following fit indexes were used to assess the fit of the three models: chi-square (c2, e.g., Bollen, 1989a), the goodness-of-fit-index (GFI, Jöreskog & Sörbom, 1981), the non-normed fit index (NNFI, Bentler & Bonnett, 1980), the incremental fit index (IFI, Bollen, 1989b), and the comparative fit index (CFI, Bentler, 1990). The use of multiple fit indexes is generally advisable in order to provide convergent evidence of model fit. The values of GFI, NNFI, IFI and CFI range from 0 to 1.0, with values closer to 1.0 indicating a well-fitting model (Bentler & Bonnet, 1980; Hoyle & Panter, 1995). Descriptive statistics and intercorrelations among indicator variables are presented in Table 2. Fit indexes for the covariance structure models tested are shown in Table 3. The onefactor model demonstrated a fairly poor fit
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3.99 4.32 3.91 4.10 4.53 4.21 3.73 3.59 3.60 3.81 3.26 3.26 3.16 3.37 3.01 2.90 3.04
1
2
0.683 – 0.602 0.573* – 0.730 0.455* 0.388* 0.669 0.571* 0.669* 0.573 0.375* 0.500* 0.686 0.424* 0.512* 0.920 0.193* 0.175* 1.03 0.073 0.108** 1.00 0.071 0.034 0.982 0.110** 0.129** 1.04 0.094 0.120** 1.09 0.018 0.022 1.04 -0.020 -0.001 1.02 0.012 0.026 1.06 0.008 0.011 1.05 -0.063 -0.056 1.11 0.032 0.020
SD
4
5
– 0.523* – 0.282* 0.403* – 0.313* 0.442* 0.457* 0.225* 0.271* 0.202* 0.144* 0.163* 0.155* 0.145* 0.116** 0.124** 0.113** 0.154* 0.223* 0.106 0.115** 0.170* -0.067 0.028 0.041 -0.035 0.045 0.043 -0.067 0.035 0.064 -0.038 0.096 0.029 -0.056 -0.040 -0.012 -0.014 0.051 0.088
3
Note: N = 335. * p < 0.01 (two-tailed), ** p < 0.05 (two-tailed).
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17
M
– 0.295* 0.204* 0.156* 0.264* 0.250* 0.171* 0.192* 0.215* 0.191* 0.113** 0.185*
6
– 0.594* 0.374* 0.495* 0.560* 0.425* 0.463* 0.529* 0.418* 0.379* 0.420*
7
– 0.471* 0.402* 0.591* 0.438* 0.474* 0.509* 0.484* 0.411* 0.404*
8
– 0.336* 0.419* 0.335* 0.349* 0.372* 0.342* 0.278* 0.360*
9
– 0.598* 0.378* 0.423* 0.450* 0.411* 0.398* 0.363*
10
Table 2. Means, Standard Deviations, and Intercorrelations among Indicator Variables (Subsample 2 Data)
– 0.478* 0.496* 0.533* 0.543* 0.412* 0.475*
11
– 0.802* 0.728* 0.744* 0.603* 0.767*
12
– 0.777* 0.800* 0.604* 0.694*
13
15
16
17
– 0.777 – 0.662* 0.667* – 0.674* 0.757* 0.629* –
14
42 CREATIVITY AND INNOVATION MANAGEMENT
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Table 3. Fit Indexes for Covariance Structure Analyses Model 1. One-factor model 2. Two-factor model Model 1–2 difference 3. Three-factor model Model 1–3 difference 4. Null
c2
df
GFI
NNFI
IFI
CFI
1204.2 534.47
119 118
0.61 0.82
0.62 0.85
0.62 0.87
0.67 0.87
280.66
116
0.92
0.94
0.95
0.95
3389.2
df
669.73
1
253.81
2
136
(c2 [119, N = 335] = 1204.2, GFI = 0.61, NNFI = 0.62, IFI = 0.67, CFI = 0.67) The two-factor model yielded substantially better fit than the one-factor model (c2 [118, N = 335] = 534.47, GFI = 0.82, NNFI = 0.85, IFI = 0.87, CFI = 0.87), but the three-factor model demonstrated the best fit of the models tested (c2 [116, N = 335] = 280.66, GFI = 0.92, NNFI = 0.94, IFI = 0.95, CFI = 0.95). In addition, c2 difference tests (Anderson & Gerbing, 1988; Bollen, 1989a) indicated statistically significant c2 differences between each of the three models. Thus, the three-factor model was retained as the best-fitting model. The standardized solution for this model is shown in Figure 1 with measurement error effects omitted for clarity.
1 0.48 0.49 0.42 Creative Potential
The results of the present study provide some initial evidence supporting the construct validity of creative potential and practised creativity. EFA results suggested a clear factor structure for each construct with high factor loadings and virtually no significant crossloadings for any of the items. The reliability of the items used to measure each construct was also quite good, with coefficient alphas of 0.84 for each of the constructs. CFA results provided additional evidence in support of the construct validity of these concepts. A threefactor model with factors for creative potential, practised creativity and organizational support for creativity showed superior fit over competing one- and two-factor models, indicating reasonably effective measurement, fairly clean factor structures and evidence of discriminant validity. These results suggest important implications for organizational decision makers. The difference between creative potential and practised creativity could represent important untapped resources that could boost innovation, productivity and job satisfaction if utilized. In the past, this type of untapped
2 3 0.54
0.33
4 5
0.42 6
0.68
7 0.76
8 0.54
Practised Creativity
0.65 0.83
Discussion
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c2 difference
9 10
11
12
0.94 0.92
13
0.88
Perceived Organizational Support
0.95 0.77 0.91
14 15 16
17
Figure 1. Confirmatory Factor Analysis Results: Three-Factor Model Note: N = 335. All parameter loadings were significant at the a = 0.05 level. creative potential was largely invisible because there was nothing to measure aside from creative outcomes such as songs, poems, patents, numbers of suggestions, etc. By measuring and considering employee perceptions of their own creative potential and practised creativity,
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organizational leaders may effectively assess the existing creativity gap within their organization. Organizational leaders could then utilize this information to design interventions aimed at tapping into these dormant creative resources, resulting in a win-win situation, in which employees experience more freedom to exercise their creative potential thus increasing innovation, satisfaction, productivity and organizational effectiveness. Although the results reported here suggest exciting implications for unleashing creative resources, this study is nevertheless subject to certain limitations. First, the present sample was relatively homogeneous, consisting entirely of members of the Army Contracting Agency within the United Stated Department of Defense. We have argued that such as sample is especially appropriate for creativity research because organizations such as the DoD take a keen interest in tapping all creative resources available in order to sustain a competitive advantage. Nevertheless, it remains to be seen whether the concepts examined here would demonstrate a similar degree of construct validity in other samples of interest. Second, all items were self-reported and collected in a single survey at a single point in time, thus raising concerns regarding measurement issues such as response set and social desirability biases. Nevertheless, despite some inherent weaknesses, self-report data is widely used in behavioural research, particularly in the measurement of personality, cognition and other unobservable behavioural processes. In addition, studies generally support the validity of self-reports as a substitute for many types of objective and subjective data (e.g., Crockett, Schulenberg & Petersen, 1987). Finally, although this study assessed the construct validity of these constructs, including an examination of discriminant validity, it did not examine convergent validity. Convergent validity occurs when scores on a given scale designed to measure a certain construct correlate with scores on another instrument designed to measure the same construct (e.g., Campbell & Fiske, 1959). An examination of convergent validity was impossible in the current study because there are no other known measurement items available for measuring these constructs. Future research should focus on the further examination of the construct validity of these concepts, particularly across other organizational samples of interest. Construct validation is not something that can be accomplished in a single study, but rather is a process that requires an accumulation of evidence (Messick, 1995). Future research should also examine the relationships among creative
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potential, practised creativity and organizational support for creativity by specifically testing the hypothesis that individuals with strong creative potential are more likely to practise creativity when they perceive strong support from the organization (DiLiello & Houghton, 2006). Such research could help to provide a framework that would aid organizations such as the DoD in assessing and reducing the gap between creative potential and practised creativity. By cultivating environments that support creativity, modern organizations may be able to tap into heretofore idle creative potential in order to face a wide array of 21st-century challenges.
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Bentler, P.M. (1990) Comparative Fit Indices in Structural Models. Psychological Bulletin, 107, 238–46. Bentler, P.M. and Bonnett, D.G. (1980) Significance Tests and Goodness-of-Fit in the Analysis of Covariance Structures. Psychological Bulletin, 88, 588–606. Bollen, K.A. (1989a) Structural Equations with Latent Variables. Wiley, New York. Bollen, K.A. (1989b) A New Incremental Fit Index for General Structural Equation Models. Sociological Methods and Research, 17, 303–16. Brown, R.T. (1989) Creativity: What Are We to Measure? In Glover, J.A., Ronning, R.R. and Reynolds, C.R. (eds.), Handbook of Creativity. Plenum Press, New York. Campbell, D.T. and Fiske, D.W. (1959) Convergent and Discriminant Validation by the MultitraitMultimethod Matrix. Psychological Bulletin, 56, 81–105. Crockett, L.J., Schulenberg, J.E. and Petersen, A.C. (1987) Congruence between Objective and Selfreport Data in a Sample of Young Adolescents. Journal of Adolescent Research, 2, 383–92. Csikszentmihalyi, M. (1996) Creativity, Flow and the Psychology of Discovery and Invention. HarperCollins, New York. Cummings, A. and Oldham, G.R. (1997) Enhancing Creativity: Managing Work Contexts for the High Potential Employee. California Management Review, 40, 22–38. Cummings, L.L., Hinton, B.L. and Gobdel, B.C. (1975) Creative Behavior as a Function of Task Environment: Impact of Objectives, Procedures, and Controls. Academy of Management Journal, 18, 489–99. Deci, E.L. and Flaste, R. (1995) Why We Do What We Do. Penguin, New York. Deci, E.L. and Ryan, R.M. (1985) Intrinsic Motivation and Self-Determination in Human Behaviour. Plenum Press, New York. DiLiello, T.C. and Houghton, J.D. (2006) Maximizing Organizational Leadership Capacity for the Future: Toward a Model of Self-Leadership, Innovation and Creativity. Journal of Managerial Psychology, 21, 319–37. Dillman, D. (2000) Mail and Internet Surveys: The Tailored Design Method, 2nd edn. John Wiley & Sons, New York. Eisenberger, R. and Cameron, J. (1998) Reward, Intrinsic Interest, and Creativity: New Findings. American Psychologist, 53(6), 676–9. Eisenberger, R., Fasolo, P. and Davis-LaMastro, V. (1990) Perceived Organizational Support and Employee Diligence, Commitment, and Innovation. Journal of Applied Psychology, 75, 51–59. Feldhusen, J.F. and Goh, B.E. (1995) Assessing and Accessing Creativity: An Integrative Review of Theory, Research and Development. Creativity Research Journal, 8, 231–47. Ford, C.M. (1996) A Theory of Individual Creative Action in Multiple Social Domains. Academy of Management Review, 21, 1112–42. George, J.M. and Zhou, J. (2001) When Openness to Experience and Conscientiousness are Related to Creative Behavior: An Interactional Approach. Journal of Applied Psychology, 86, 513–24. © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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Gorsuch, R. (1974) Factor Analysis. Saunders, Philadelphia, PA. Guilford, J.P. (1950) Creativity. American Psychologist, 5, 444–54. Hackman, R.J. and Oldham, G. (1975) Development of the Job Diagnostic Survey. Journal of Applied Psychology, 60, 159–70. Herzberg, F., Mausner, B. and Snyderman, B.B. (2003) The Motivation to Work. Transaction Publishers, New Brunswick, NJ (originally published in 1959). Hinton, B.L. (1968) A Model for the Study of Creative Problem Solving. Journal of Creative Behavior, 2, 133–42. Hinton, B.L. (1970) Personality Variables and Creative Potential. Journal of Creative Behavior, 3, 210– 17. Hocevar, D. and Bachelor, P. (1989) A Taxonomy and Critique of Measurements Used in the Study of Creativity. In Glover, J.A., Ronning, R.R. and Reynolds, C.R. (eds.), Handbook of Creativity. Plenum Press, New York. Hoyle, R.H. and Panter, A.T. (1995) Writing about Structural Equation Models. In Hoyle, R.H. (ed.), Structural Equation Modeling: Concepts, Issues, and Applications. Sage, Thousand Oaks, CA, pp. 158– 76. Jöreskog, K. and Sörbom, D. (1981) LISREL V: Analysis of Linear Structural Relationships by the Method of Maximum Likelihood. National Educational Resources, Chicago, IL. Jöreskog, K. and Sörbom, D. (1993) LISREL 8: Structural Equation Modeling with the SIMPLIS Command Language. Erlbaum, Hillsdale, NJ. Kanter, R.M. (1983) The Change Masters: Innovation and Entrepreneurship in the American Corporation. Simon & Schuster, New York. Kijkuit, B. and van den Ende, J. (2007) The Organizational Life of an Idea: Integrating Social Network, Creativity and Decision-Making Perspectives. Journal of Management Studies, 44, 863– 82. Leenders, R.Th.A.J., van Engelen, J.M.L., Kratzer, J. (2007) Systematic Design Methods and the Creative Performance of New Product Teams: Do they Contradict or Complement Each Other? Journal of Product Innovation and Management, 24, 166–79. Locke, E.A., Frederick, E., Lee, C. and Bobko, P. (1984) Effect of Self-Efficacy, Goals, and Task Strategies on Task Performance. Journal of Applied Psychology, 69, 241–51. Martindale, C. (1989) Personality, Situation, and Creativity. In Glover, J.A., Ronning, R.R. and Reynolds, C.R. (eds.), Handbook of Creativity. Plenum Press, New York. Maslow, A.H. (1970) Motivation and Personality, 3rd edn. Revised by Frager, R., Fadiman, J., McReynolds, C. and Cox, R. Addison Wesley Longman, New York. Messick, S. (1995) Validity of Psychological Assessment. American Psychologist, 50, 741–9. Mumford, M.D. and Gustafson, S.B. (1988) Creativity Syndrome: Integration, Application, and Innovation. Psychological Bulletin, 103, 27–43. Rosenfield, D., Folger, R. and Adelman, H.F. (1980) When Rewards Reflect Competence: A Qualifica-
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tion of the Overjustification Effect. Journal of Personality and Social Psychology, 39, 368–76. Scott, W.E. (1965) The Creative Individual. Academy of Management Journal, 8, 211–19. Shalley, C.E. (1995) Effects of Coaction, Expected Evaluation, and Goal Setting on Creativity and Productivity. Academy of Management Journal, 38, 483–503. Shalley, C.E. and Oldham, G.R. (1985) Effects of Goal Difficulty and Expected External Evaluation on Intrinsic Motivation: A Laboratory Study. Academy of Management Journal, 28, 628–40. Shalley, C.E. and Oldham, G.R. (1997) Competition and Creative Performance: Effects of Competitor Presence and Visibility. Creativity Research Journal, 10, 337–45. Shalley, C.E., Oldham, G.R. and Porac, J.F. (1987) Effects of Goal Difficulty, Goal-Setting Method, and Expected External Evaluation on Intrinsic Motivation. Academy of Management Journal, 30, 553–63. Shalley, C.E., Gilson, L.L. and Blum, T.C. (2000) Matching Creativity Requirements and the Work Environment: Effects on Satisfaction and Intentions to Leave. Academy of Management Journal, 43, 215–23. Sheehan, K.B. (2001) E-mail Survey Response Rates: A Review. Journal of Computer-Mediated Communication [WWW document]. URL: http://jcmc. indiana.edu/vol6/issue2/sheehan.html. Simonton, D.K. (1992) Creativity and Leadership: Causal Convergence and Divergence. In Gryskiewicz, S.S. and Hills, D.A. (eds.), Readings in Innovation. Center for Creative Leadership, Greensboro, NC, pp. 29–43. Sternberg, R.J. and Lubart, T.I. (1999) The Concept of Creativity: Prospects and Paradigms. In Sternberg, R.J. (ed.), Handbook of Creativity. Cambridge University Press, New York. Tierney, P. and Farmer, S.M. (2002) Creative Self-efficacy: Its Potential Antecedents and Relationship to Creative Performance. Academy of Management Journal, 45, 1137–48. Tierney, P. and Farmer, S.M. (2004) The Pygmalion Process and Employee Creativity. Journal of Management, 30, 413–23.
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Tushman, M. and O’Reilly, C.A., III (1997) Winning through Innovation: A Practical Guide to Leading Organizational Change and Renewal. Harvard Business School Press, Boston, MA. Utterback, J.M. (1994) Mastering the Dynamics of Innovation. Harvard Business School Press, Boston, MA. Weisberg, R.W. (1999). Creativity and Knowledge: A Challenge to Theories. In Sternberg, R.J. (ed.), Handbook of Creativity. Cambridge University Press, New York. Woodman, R.W. and Schoenfeldt, L.F. (1989) Individual Differences in Creativity: An Interactionist Perspective. In Glover, J.A., Ronning, R.R. and Reynolds, C.R. (eds.), Handbook of Creativity. Plenum Press, New York. Woodman, R.W., Sawyer, J.E. and Griffen, R.W. (1993) Toward a Theory of Organizational Creativity. Academy of Management Journal, 8, 293– 321.
Trudy C. DiLiello holds a Doctorate of Public Administration from the University of La Verne. She is an Instructor for the Defense Acquisition University (DAU) where she teaches Contract Management. Before joining the DAU, she was a Contracting Officer for the Naval Facilities Engineering Command. Jeffery D. Houghton (Jeff.Houghton@ mail.wvu.edu) is an Associate Professor of Management and Director of the Master of Science in Human Resources and Industrial Relations (MSIR) program at West Virginia University. He holds a PhD in Organizational Studies from Virginia Tech. Professor Houghton has presented his research at various professional meetings and has published numerous articles in a variety of respected journals.
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Bring in the Arts and Get the Creativity for Free: A Study of the Artists in Residence Project Alexander Styhre and Michael Eriksson In the literature on creativity and innovation, there is a tendency to idolize great contributors to the liberal arts as extraordinarily creative individuals. Such ex post facto accounts of ‘great men and women’ are, however, of limited value for everyday practices in organizations. This paper reports insights from a Swedish project named Artists in Residence (AIRIS) wherein artists, including musicians, painters, actors and directors, dancers and choreographers, collaborated with a regular company or workplace during a ten-month project, aimed at helping the co-workers think in new and creative ways. The study concludes that there are many benefits from making the world of artists and the world of work intersect, but there is also a demand on the participant to fully commit to the project. Even though the culture project was positively received among co-workers, only a limited effect on workplace climate could be reported for the 2005 evaluation, while the 2006 evaluation indicates more positive effects. Still, the amount of texts advocating artists’ creative skills and experiences outnumber the cases of actual projects bringing the two groups together. Studies of projects like AIRIS show that there is a great potential in bringing artists into industry.
Introduction Art is a means of experiencing the process of creativity. The artifact itself is quite unimportant. Viktor Shklovsky ([1929] 1990: 6) Culture and art are beside science two of the most praised human accomplishments. Museums and galleries throughout the world are dedicated to various forms of culture and art. At the same time, artists tend to be marginalized until they have managed to attain recognition within their field (Menger, 1999). In few other fields is the contrast between the poor struggling artist before his or her recognition and the life of the famed and successful artist afterwards more accentuated. The case of Vincent van Gogh is a particularly good example: during his lifetime he lived an obscure and troubled life, but after his death he became the paragon of modern painting, constituting a veritable art industry in his own right. In the field of innovation management and in the literature on creativity in general and as an organization resource, there is a tendency © 2007 The Authors Journal compilation © 2007 Blackwell Publishing
to regard various forms of artists as embodiments of creativity. Cultural icons such as Picasso, Van Gogh, Bach, Mozart, etc., are stock household names denoting the creative capacity of the genius. However, not even Bach – the first of the great German composers in the tonality tradition – was fully recognized during his lifetime (McClary, 1987, p. 55). Osbourne (2003, p. 519) is sceptical about such uncritical accounts of creativity (see, e.g., Miller, 1999) and advocates what he calls ‘a post-heroic conception of creativity’. From history we learn that creativity is situational and contingent and the product of complex discursive articulations (Amabile et al., 1996; Amabile, 1997, 1999; Andriopoulos, 2001; Mumford et al., 2002; Basadur, 2004). Creativity is what is declared in ex post facto secondorder statements rather than some innate quality of a particular work. Still, artists and culture workers of various orientations are trained to think in new terms and along divergent lines. Such properties are increasingly valued in a working life characterized by time pressure and the demand to do more with less (Adler, 2006; Lanham, 2006).
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Several studies of innovation and the use of creativity emphasize the need to expand horizons and to take alternative views in innovation and creative work. From such a perspective, artists are often regarded as a resource poorly exploited in industry. However, there are few studies of how such collaborations are carried out. This paper reports a study of a Swedish project, Artists in Residence (AIRIS), among whose aims is to make artists and industry collaborate more closely. The project, originally started in 2002 and still running, is an interesting example of how artists and industry and public sector organizations can learn from one another. Projects like AIRIS are representative of a general recognition of the opportunity to cross-fertilize the field of culture with industry. It is the product of a society becoming increasingly aware of the need not only to finetune the existing order of things but also to be able to think in new terms.
The Concept of Aesthetics and Its Importance for Creativity Aesthetics The concept of aesthetics is arguably as old as Aristotle’s Poetics (Holquist, 2003, p. 368). However, it was not until the Romantic Movement in Germany in the eighteenth century that the German philosopher Baumgarten and his more famous disciple Immanuel Kant ‘invented’ the discipline of aesthetics. Since then, aesthetics has become part of continental philosophy. Perhaps the most widely cited text on aesthetics is Friedrich Schiller’s Letters on Aesthetic Education, first published in 1795. Schiller thus places aesthetic cultivation at the centre of the development of man: ‘In a word, there is no other way to make the sensuous man rational than by first making him aesthetic’, Schiller ([1795] 2004, p. 108) claims. ‘Aesthetic education’ is for Schiller, then, not a matter of guiding the pupil in the domain of the decorative and ornamental arts but of providing him (and later on, her) with the tools for becoming ‘rational’. Kant did not follow Schiller on his insistence on giving aesthetics a clear social role but rather spoke of art as having a Zweckmässigkeit ohne Zweck, ‘having a quality of being purposeful without having a purpose’ (Holquist, 2003, p. 368). Ever since Kant, aesthetics and forms of rational thinking, grounded in logic, have been separated (Luhmann, 2000, p. 15). Art on the one hand, science on the other. In his recent discussion of the concept of aesthetics, Shusterman (2006) emphasizes that
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the concept is ‘deeply ambiguous, complex and essentially contested’. This is the case partly because the underlying categories of aesthetics such as ‘art’ and ‘beauty’ are themselves ambiguous, partly because the term aesthetics has a ‘complicated, heterogeneous, conflicted and disordered genealogy’ (Shusterman, 2006, p. 237). That is, the term has been used in a variety of ways. Still, Shusterman (2006, p. 237) defines aesthetics as ‘the philosophy of art and beauty’. Sociologists of art and aesthetics share with Shusterman (2006) the view that aesthetics and other culture sector categories are poorly defined (DiMaggio, 1987; Heikkinen, 2005; Roodhouse, 2006). For instance, in a much-cited paper, DiMaggio distinguishes between three types of classifications operating in conjunction with one another: commercial classification, professional classification, administrative classification. Heikkinen (2005), exploring the diversity of what DiMaggio calls administrative classifications in the four Nordic countries of Sweden, Finland, Denmark and Norway, found that each country used individual systems to classify the arts and artists. Roodhouse (2006, p. 48), studying the case of the UK, is very critical of this inability to establish shared classification systems and argues: ‘At best, the data collected and used to inform management at micro and macro levels and to provide evidence for policymaking is inaccurate; at worst, it is seriously unreliable’. In summary, from both a theoretical and practical perspective, aesthetics is a concept riddled with ambiguities. Yet the concept remains useful; ‘vague terms still signify’, Shusterman (2006, p. 243) says. A number of scholars have recently suggested that aesthetics and art are of great importance for organizations and for understanding contemporary organizations. Lanham (2006) suggests we are living in an ‘attention economy’, where attention, not information, is the scare resource to exploit. In addition, Lanham (2006) argues, ‘style’ rather than ‘substance’ is what attracts attention. Adler (2006) is most enthusiastic about the future function and role of art and aesthetics in industry and offers a variety of examples of how art is used to improve individual and collective performance. For instance, researchers at Yale Medical School have ‘[a]lready found that by introducing medical students to art, through an introductory art history seminar, the student-doctors’ diagnostic skills improve significantly’ (Adler, 2006, p. 395). Speaking about computer programming, a social practice profoundly associated with exactness and rationality, Piñeiro (2007, p. 105) argues that there is a great sense of aesthetics in computer © 2007 The Authors Journal compilation © 2007 Blackwell Publishing
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programming work: ‘Regardless of the restrictions forced upon human activity, if there is as much as an ounce of creative work involved or permitted, aesthetic concerns will thrive’. Similarly, Guve (2007) speaks of aesthetics as a resource in risk capitalist work. In addition to these studies of work and activities not commonly associated with aesthetics, a number of studies emphasize the role of art and aesthetics in the domain of arts management, a category of work including a great many professions and occupations ranging from opera house directors to individual artists and musicians. Belfiore (2002), Gibson (2002) and García (2004) examine how art is used as a social resource in a number of urban renewal and city marketing projects, and Macnaughton (2007) shows how a newly built hospital in Middlesbrough, north-east England, is using art to create a more appealing environment for both patents and hospital staff. However, one of he principal critiques of such programmes and projects is that the arts are treated in overtly instrumental terms, being primarily conceived of as tools to accomplish political objectives. Belfiore (2002), for instance, concludes her analysis: [T]he main problem created by the argument that the arts are a source of urban regeneration, or that public subsidy is in fact an ‘investment’ with specific, measurable social returns, is that the arts become entirely instrumental. Degraded to the function of mere tool, arts become a matter of ‘value for money’. One non-arts professional . . . puts this baldly: ‘I’m very positive about the use of the arts as long as it’s not art for art’s sake: it’s a tool. You’ve got to have clear determined aim and objectives, and have an end product’. (Belfiore, 2002, p. 104) In summary, the concepts of art and aesthetics are loosely defined but still serve a function to denote a set of practices and certain ideologies in what Bourdieu (1993) called ‘the field of cultural production’ and Becker (1982) calls ‘art worlds’.
Creativity In the field of innovation management and the creativity literature, such a strict distinction becomes blurred. A number of definitions of creativity may be provided. Madjar, Oldham and Pratt (2002, p. 757) argue ‘We consider employee creativity to be the production of ideas, products, or procedures that are (1) novel or original and (2) potentially useful to the organization’. Shalley and Gilson (2004, p. 36) speak of creativity accordingly: © 2007 The Authors Journal compilation © 2007 Blackwell Publishing
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Creativity relevant skills can be defined as the ability to think creatively, generate alternatives, engage in divergent thinking, or suspend judgment. These skills are necessary because creativity requires a cognitiveperceptual style that involves the collection and application of diverse information, an accurate memory, use of effective heuristics, and the ability and inclination to engage in deep concentration for long periods of time. Scott and Bruce (1994, p. 581) say that the concepts of creativity and innovation are often used interchangeably in the literature but argue that ‘creativity has to do with the production of novel and useful ideas . . . and innovation has to do with the production or adaptation of useful ideas and idea implementation’. The British physicist David Bohm emphasizes that creativity is demanding because it insists on making us think against what we have learnt throughout our upbringing, namely that things may not be what they appear to be, that the order of things may be different, and so forth: [C]reative work requires, above all, a creative state of mind. And, generally speaking, what we learn as children, from parents, teachers, friends, and society in general, is to have a conformist, imitative, mechanical state of mind that does not present the disturbing danger of ‘upsetting the apple cart’. (Bohm, 1998, p. 16) Thus, more recently, creativity has been emphasized as an organizational resource that does not obey the same procedures as other organizational resources (Guillén, 1997; Linstead & Höpfl, 2000; Guillet de Monthoux, 2004). Antonio Strati (1999, p. 176), a proponent of an aesthetic view of organization, says: ‘When we study people’s creativity . . . we observe organizational forms very different from those to which we have been accustomed by the dominant Taylorist and Fordist models’. Sternberg (2003, p. 391) emphasizes creativity in leadership work: ‘Creativity is important for leadership because it is the component whereby one generates the ideas that others will follow . . . Many leaders are academically and even practically intelligent, but uncreative; they lead people through their ability to influence rather than through their agenda’. Leading creative people is, Sternberg (2003) suggests, a complicated practice because creative individuals are thinking in new terms and are willing to redefine problems, take risks and tolerate ambiguities. In the literature on creativity, the ‘extrarational’ qualities of creative individuals are emphasized. Creative individuals accommo-
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date aesthetic skills and qualities and can see beyond the narrow horizon of utility that restrains many co-workers in organizations. On the other hand, some researchers have shown that creative artists have been influenced and actually used managerial principles and methods such as motion studies to develop their work methods (Reeves, Duncan & Ginter, 2001; Van Delinder, 2005). Another concept brought into the analysis of creativity and innovation is play, conceived of as a domain where alternatives modes of thinking are permitted and actively promoted (Anderson, 1994; Dougherty & Takacs, 2004; Dodgson, Gann & Salter, 2005). Play, here, shares a number of characteristics with aesthetics, such as what broadening the perspective and enabling new worldviews. Some writers suggest that it is primarily large and mature organizations that need to develop such skills (Schumann, 1993; Sharma, 1999), while smaller and younger organizations have maintained their capacity to pursue creative thinking. In summary, creativity and innovation are, at least partially, informed by an aesthetic capacity of individuals or groups of individuals. An aesthetic view of things is enacting plural views which facilitates a change of perspective. It also helps defamiliarizing predominant beliefs, assumptions, or practices which opens up new lines of thought and discussion. However, even though such virtues are advocated or even cherished in theory, there is little evidence of how aesthetic thinking may be brought into industry in practice. In the following, one such project where artists and organization members are collaborating is examined.
A Note on Methodology The AIRIS project was studied by one of the authors during the period 2004–2007. The first year, 2004, was examined through retrospective telephone interviews with company and public organization representatives. From 2005 and onwards, the project has been followed in greater detail. The methodology of the study is based on both quantitative and qualitative methods. In order to examine the willingness to change in the participating organizations, two instruments (Göran Ekvall’s widely used workplace climate inventory and the psychologist Sven Kylén’s defensive routine mechanisms survey instrument) were used at three times during the project: at the beginning, in the middle, and at the end of the project. On each occasion, 20 randomly selected participants in each project were
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asked to fill in the questionnaire. The response rate was about 80 percent, taking into account significant variations between projects (ranging between 60 and 95 percent). In addition, interviews were conducted with the managing director and a co-worker representing the personnel function or the trade union at the site. By the time of the middle and end surveys, the participating artists had been interviewed. Interviews were semi-structured and conducted by two people, one researcher and one representative of the AIRIS administration team. By the time of the middle measurement questionnaire, the research team had conducted a field study of the individual projects, providing a more contextualized and detailed insight into the projects. Interviews lasted for about one hour and were taperecorded. Moreover, in the 2006 project, one of the authors participated in meetings with the AIRIS project team, serving as a discussant for the project team and helping to provide a more coherent theoretical and methodological framework for the project. The paper also uses formal documentation available on the AIRIS homepage (http://www.vg.skadebanan.org/ airis/index.html) and a research report written by Lindqvist in 2005, evaluating the 2002 to 2004 AIRIS projects. Although Lindqvist’s report covers the first three years, her findings are of relevance even for the period 2005–2006; some changes have been implemented in the overall project design but the basic ideas are the same. It is noteworthy that the study of the AIRIS project was not conducted on the level of individual projects, that is, as ‘mini-ethnographies’ of individual artist’s collaborations with the companies and workplaces. Therefore, the presentation of the project emphasizes the staging of the entire project and its political and artistic objectives rather than their individual outcomes at each workplace.
The Artists in Residence Project Background The concept Artists in Residence is widely used when artists are given the opportunity to work on their individual art projects in a company setting or in collaboration with companies. Famous and widely acclaimed artist-inresidence projects include the Xerox Palo Alto Research Centre’s (PARC) PARC Artists-inResidence project (PAIR), described in Harris’s (1995) edited volume. PARC was set up and designed to serve as a creative centre for the Xerox Corporation and, as part of this project, PAIR was started to help both artists and Xerox © 2007 The Authors Journal compilation © 2007 Blackwell Publishing
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engineers develop their creative skills. The Swedish AIRIS projects was not designed to operate in an equally prestigious setting but sought to use some of the basic ideas from other artist-in-residence projects. In Sweden, the culture sector is largely funded by taxes and only to a minor extent by ticket sales. Culture workers and artists also face periods of unemployment. On the other hand, Swedish industry and public sector organizations are working under great pressure to become more effective and to do more with less. In such conditions, organizations become less able to think in new terms and to fully exploit the creative competencies of its co-workers. The AIRIS project is one arena where artists and industry may join hands and learn from one another. In the following, learnings from the project will be discussed. The Skådebanan organization was founded in 1910 to work with theatre as a means of public schooling, making individuals with little experience from theatre and other cultural forms become involved in cultural activities. Skådebanan became a movement with local and regional offices and organizations scattered throughout Sweden, engaging in a variety of culture projects (see Guillet de Monthoux, 2004, for an overview). The Västra Götaland regional Skådebanan office collaborates with a number of organizations including the Gothenburg Business Region organization, the Västra Götaland regional government, and the Swedish National Council for Cultural Affairs. The AIRIS (Artists in Residence) project aims at expanding the intersection between industry and public administration and the domain of culture. In Sweden, a number of organizations are actively promoting an increased intersection between culture and industry. For instance, the Arts and Business organization is an organization promoting basically the same goals as Skådebanan, arranging workshops and events where the benefits of bringing culture and industry closer is elaborated upon.
The Project While organizations like Arts and Business primarily promote the idea of using artists’ skills more effectively in industry, the AIRIS project is a project where artists are actually located in a specific firm or organization for a period of ten months to work with a culture project. However, the culture project actually include three separate goals: (1) a culture-political goal to create an arena where industry and the culture sector and its agents can meet and © 2007 The Authors Journal compilation © 2007 Blackwell Publishing
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interact,1 (2) a business development goal aimed at enhancing the creative capabilities of industry and public sector organizations, and (3) a labour market goal where new arenas for employment opportunities for professional artists are being created. The AIRIS project was marketed in the Västra Götaland region and companies and workplaces signed up to participate in the project. The AIRIS organization selected workplaces to achieve a representative mixture of workplaces (e.g., service companies, knowledge-intensive firms, manufacturing companies, public sector organizations, etc.). The managers’ rationale for joining the AIRIS project and bringing an artist into the organization was, Lindqvist (2005, p. 75) argues, to create a better work environment and to provide a meaningful and creative break from the regular work. The artist’s work was thus conceived of as a vehicle for creating a more effective and socially appealing workplace. Managers also conceived of the project as an opportunity to nourish the creativity of the co-workers and to help them deal with unanticipated events and occurrences. Finally, managers also appreciated someone being brought in from outside, who would have a ‘fresh eye’ on the company’s activities, giving advice on how to improve the day-to-day work. The official AIRIS documentation also quotes managers advancing such arguments. The culture projects are individually designed collaboratively between the artist and the participating organizations and include three phases. During the first phase (two months), the artist is researching the organization and creates contacts with the co-workers and they jointly formulate an action plan for the project. The action plan is thus the outcome of a close collaboration between the two parties. In the second phase (six months) the artist is working with the action plan and develops a number of activities, events or workshops in collaboration with the co-workers in the organization. The last phase includes an evaluation of the activities and a final seminar where all participating artists and companies report 1
In Sweden, public funding at the level of the Swedish state, the regional government, or the local municipality supports most cultural institutions. Most political programmes thus include a so-called culture-political agenda and declaration. The term ‘culture-political goal’ here denotes the political decision to broaden the institutional arena for the traditional arts (e.g., theatre, ballet, classical music) to bring them into new settings and communities, thereby further exploiting the skills and competencies of artists. The term ‘culture-political goal’ is a direct translation of a common expression in the political discourse (Swedish, Kulturpolitiskt mål).
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Table 1. Participants in the AIRIS Project 2006 and Project Description Artist 2006 Artist Photographer
Company/industry
Food supermarket
Actor/playwright
Healthcare organization Truck manufacturer
Choreographer
Construction company
Singer/songwriter musician Actor/director
Technical department, municipality Shipping company
Singer and musician
Dental healthcare
Choreographer
Pharmaceutical company
Project description
Music video on the theme ‘dreams’, introductory film about the company Photographic documentation of the way to work; self portraits and co-workers’ portraits Writing course, literature seminar, theatre visits followed by discussions Performance art work, communication training, joint visits to cultural events Radio program, ‘culture festival day’, joint film work The documentary movie ‘Sea sickness’ about the everyday work at the shipyard, photo projects documenting work Breathing exercises, vocal training, joint visits to cultural events Training in communicating through the body; joint photograph documentation project
Source: AIRIS 2006 (available at http://www.vg.skadebanan.org/airis/download/airis_2006dok.pdf, accessed 9 May 2007).
their experiences and learnings. The AIRIS project includes a number of different categories of art forms such as acting, arts, popular and classical music, choreography and photography. In addition, the participating companies and organizations represent a great variety of industries and public sector organizations. Participating companies pay a relatively small fee (about 5,000 euros per project in 2005 and 15,000 euros in 2007) to participate and the artists are paid by the AIRIS project. Tables 1 present a summary of participating artists, companies and activities for the 2006 project, and Table 2 presents a summary of participating artists and companies in the earlier years of the project. In the AIRIS project, artistic freedom is emphasized. The artists are not evaluated in terms of ‘measurable output’ but in terms of qualitative effects, for instance if the coworkers learned something about themselves or their work, or if they started to think in new terms. Therefore, the quantitative evaluations conducted by the research team was not used to review individual projects but was used by the programme board to evaluate the overall effects of the projects and to provide some quantitative evidence to use when communicating with politicians and decision makers. The artists are also expected to work with methods and events that suit their own domain of expertise, even
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though in practice there were examples of artists orchestrating activities outside their core artistic domain. For instance, a dancer worked with painting as part of her project. It is also worth noting that the participating artists have significant work life experience with cultural institutions and departments, but that most of them have never been part of a project like AIRIS. In 2007, however, a number of artists with previous experience from AIRIS projects are engaged in new projects. In order to support them in their individual projects, the artists met and discussed their experiences throughout the project period. The role of the artists is to operate as what may be called a ‘creative consultant’, even though the participating researcher claimed it was important not to take on readymade identities and roles but to conceive of the creative process as the gradual emergence of new and innovative positions for both parties involved in the project. However, here the concept denotes someone capable of offering alternative perspectives on predominant beliefs and assumptions, existing routines and work practices, etc. Many participating artists reported that they initially faced some mild scepticism or even resistance by the company or workplace representatives, conceiving of the project as some kind of ‘management fad’, stealing valuable time from more prioritized © 2007 The Authors Journal compilation © 2007 Blackwell Publishing
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Table 2. Participants in Previous AIRIS Projects 2002–2005 2005 Artist Artist Choreographer Choreographer Actor/director Musician Actor/director Musician 2003–2004 Artist Choreographer Actor/playwright Musician Artist Actor/director Musician 2002 (Pilot study) Artist Musician Artist Actor/director
Real estate company Healthcare organization Healthcare organization Design bureau Architecture firm High school Public transportation call centre Engineering company National Institute of Working Life Petroleum company Real estate company Working life department, municipality Medical technology company High school Engineering company School Civil engineering department Engineering company Human resources department, municipality
concerns. However, after spending some time together and having outlining the purpose and objectives of the project, most participants thought of the collaboration in more positive terms. The key to overcoming initial scepticism and resistance appear to be collaborative work capable of eliminating the preconceived ideas of both parties. When examining what activities took place in the projects, the variety of activities is very noticeable. In some cases, the artists have arranged seminars and workshops or engaged the co-workers in producing their own artistic accounts of their work life experience. For instance, a photographer, working at a healthcare organization caring for elderly people, encouraged the co-workers to take their own photographs of their journey to and from work, accounting for their day-to-day experience of an all too familiar and largely taken-forgranted route. In addition, the co-workers made photographic portraits of their col© 2007 The Authors Journal compilation © 2007 Blackwell Publishing
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leagues. In other cases, the artist has documented the work. In other projects, it was particular skills that were focused and trained. In one such project, a singer and musician, collaborating with a dental healthcare organization, arranged voice-training sessions where the breathing and use of the voice were exercised. In most of the projects, the artist’s work was initially regarded with some scepticism. For instance, in the truck manufacturing company, the artist claimed that the co-workers thought that he was hired as some kind of consultant to lay people off. After a while, having been properly introduced and after spending some time together, the participants in the companies and organizations thought of the collaboration with the artist as being rewarding and helping them to learn something about themselves and their co-workers. Experiences from the AIRIS projects suggest that leadership support is imperative for the success of the individual projects. In cases where leaders have changed during the tenmonth period, the participating artists have faced a more turbulent situation. Besides the leadership issue, it is difficult to say what contingencies determine a successful project, but it is clear that both artists and company or workplace representatives need to maintain an open attitude towards the collaboration. In her evaluation of the 2002–2004 AIRIS projects, Lindqvist (2005) found that managers in participating companies were very positive about the collaborations with the artists but they also had a problem in identifying immediate, measurable effects. The general belief was that the AIRIS projects improved work satisfaction and thereby indirectly enhanced productivity through lower degrees of sick leave and absenteeism. In the formal documentation of the 2005–2006 period, managers articulated similar beliefs and experiences. An evaluation by a research team of the effects of the 2006 projects could find little evidence of any significant changes in the work climate in the work places in the 2005 evaluation. A rather small improvement in what was called ‘work climate’ is, however, accounted for. In 2006, when additional resources were added to support the artists’ work, changes in work climate were significant, but in workplaces where leaders changed, thereby disrupting the process, the effects were less significant. However, the lack of firm quantitative evidence supporting the AIRIS project does not need to be overstated. Research shows that it is complicated to provide evidence for significant changes in behaviour from most training and education investments. Instead, what may be called anecdotal evidence suggests that, equally, participating
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artists and co-workers conceive of the AIRIS project as being rewarding and interesting. Previous research shows that changes in attitude are not fully accounted for before 12 to 24 months after projects are terminated. Criticism of the AIRIS project, for instance articulated in a debate in Gothenburg’s largest newspaper, Göteborgs-Posten, emphasized the use of art and artists as a ‘production factor’ in the broader move towards the increase of the ‘creative content’ of work life declared by, for instance, Richard Florida (2002). However, such debates need to be contextualized within a broader debate over the financing and funding of culture in Sweden. Proponents of the liberal arts argued that artists should not have to ‘prove themselves useful’ but that art – just like science, its spokespersons suggest (Gieryn, 1983, p. 787) – has an intrinsic value beyond utility. Also Lindqvist’s (2005) report, otherwise affirmative regarding the attempts at bridging the world of art and industry, addresses some of the concerns regarding artists’ role as ‘creative consultants’. However, the AIRIS project was never articulated and enacted in such terms but rather was intended to help industry and the public sector develop new skills and capacities on basis of their cultural training. These objectives proved to be appreciated and a project was awarded the prestigious SABA prize, the Swedish Arts and Business Award, in November 2006.
Discussion In the debate in popular management writings, there is an emphasis on unleashing the creative potential of co-workers. However, tapping into such resources is by no means a trivial matter, and years of specialization in certain domains and activities may not easily be abandoned to embrace new thinking. In addition, several authors suggest that one must recognize the aesthetic qualities of organizing, thereby broadening the scope of possibilities. The concept of aesthetics is here used in a rather broad manner to denote a range of qualities and virtues. On the one hand, there is the organization creativity literature emphasizing the need for novel thinking, and on the other hand, the literature on aesthetics assuming that an aesthetic mindset is capable of improving the creative capabilities of co-workers. However, there is a shortage of studies demonstrating the actual use of aesthetic skills and competencies in organization. In the AIRIS project, the participating artists argued they initially encountered a mild scepticism from the co-workers who thought of the project as being some kind of management fad. As the project evolved,
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such scepticism tended to wane and most co-workers thought of the collaborations with the artists as being rewarding. The variety of activities arranged by the artists is substantial and so is the scope of workplaces and industries participating in the project. It is generally quite difficult to draw any conclusions from the projects because of this variety of activities and local conditions. The research is also complicated by the fact that out of a total of 16 projects over 2005–2006, only 11 may be regarded as fully accomplished for various reasons. The quantitative evaluation of effects of the project in terms of work climate only showed small direct effects. Still, the so-called anecdotal evidence suggests that representatives of the participating companies and workplaces expressed their appreciation for being given the chance to join the project. However, it is noteworthy that the participating companies and workplaces are only paying a rather modest fee for the ten-month project and that it is the project itself financing the artists’ work. To date, it is rather uncommon for companies to hire artists to serve as a creative resource, but projects like AIRIS are providing evidence that artists may in fact contribute with their skills and experiences. Still, the ability to make fruitful use of such skills and experiences is demanding significant investment from both the artist and the participating companies and workplaces. Artists are used to operating in a domain where art is regarded to have a value beyond its immediate utility, while in industry and public administration there are other concerns dominating the agenda. Making artists see how they can contribute to everyday work life is thus a crucial objective for initiatives like AIRIS. At the same time, co-workers in companies and organizations hosting an artist need to become aware of the fact that the outcome of the collaboration is dependent upon their full engagement. The domain of aesthetics and the domain of work must therefore intersect in meaningful and productive ways. If artists fail to take the role of the other, the co-workers in companies, there may be only marginal joint learning from the project, and if co-workers cannot open up for new thinking and action, there are few opportunities for exploiting the creative potential of the co-workers. Rather than merely assuming that aesthetics is a useful resource in organizations and particularly in creative and innovative organizations, or advocating an increased exchange of ideas, the AIRIS project is one of few projects actually bringing artists and companies together. The outcome is mixed but overall positive. For instance, artists, Lindqvist (2005) reports, had a feeling that it was their social © 2007 The Authors Journal compilation © 2007 Blackwell Publishing
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skills and ability to orchestrate creative projects that was valued by the firms, not their artistic qualifications. Yet the artists endorsed the programme and thought of their experience as being valuable for their future careers. Given these findings, our contention is that managers in organizations should consider the opportunity to collaborate with practising artists. Their ability to introduce new methods of working, communicating, and collaborating may be of great value in many organizations. However, one must not think of artists merely as what are brought into the organization to provide some ‘entertainment’ or ‘spectacle’ but to actually influence the day-to-day operations through de-familiarizing or naturalizing certain practices and assumptions. Moreover, managers must take into account that most organization change projects take time and demand considerable efforts on the part of the organization members. Just to bring in some artists for a few months is not very likely to produce instant effects. At the same time, the ability to collaborate with individuals with complementary skills and experiences may prove to be a source of long-term competitive advantage (Adler, 2006; Lanham, 2006). Speaking in more general terms, cases like the AIRIS project is valuable for the literature on creativity and innovation because it shows that there are opportunities for making use of skills and experiences from the domain of the liberal arts in regular workplaces.
Conclusions In the general interest for various forms of creativity in industry and public administration, creative artists and authors hold a position as the paragons of creative capabilities. Numerous essays and papers have pointed at the extraordinary contributions of a narrow range of iconic individuals such as Picasso or Van Gogh. In the contemporary economy, preoccupied with defining and exploring the opportunities for selling experiences and other creative services or events (see, e.g., Wolf, 1999; Jeffcut, 2000; Julier, 2000; Nyström, 2000; Chung et al., 2001; Florida, 2002; Bryman, 2004; Nixon, 2005; Ritzer, 2005; Lanham, 2006), the ability to combine aesthetic skills with market thinking is a highly attractive combination. Rather than being mere fiction or a fantasy about a coming ‘creative economy’, such ideas must be tested in real life settings. The AIRIS project is one attempt to actually bring together the world of aesthetics and the world of business. Although the overall reception of the project was positive, it is noteworthy that the costs for the participating company or work© 2007 The Authors Journal compilation © 2007 Blackwell Publishing
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place is relatively modest and that there is little evidence – at least in Sweden – of companies hiring artists to make them become more receptive to new ideas and wok in new ways. Still, projects like AIRIS indicate the great potential in better exploiting the skills of artists. It is hoped that the future will bring new arenas where artists and industry can collaborate.
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Gibson, L. (2002) Managing the People: Art Programs in the American Depression. Journal of Arts Management, Law, and Society, 31, 279–91. Gieryn, T.F. (1983) Boundary-Work and the Demarcation of Science from Non-Science: Strains and Interest in Professional Ideologies of Scientists. American Sociological Review, 48, 781–95. Guillén, M.F. (1997) Scientific Management’s Lost Aesthetic: Architecture, Organization, and the Taylorized Beauty of the Mechanical. Administrative Science Quarterly, 42, 682–715. Guillet de Monthoux, P. (2004) The Art Firm: Aesthetic Management and Metaphysical Marketing from Wagner to Wilson. Stanford University Press, Stanford, CA. Guve, B.G. (2007) Aesthetics of Financial Judgments: On Risk Capitalists’ Confidence. In Guillet de Monthoux, P., Gustafsson, C. and Sjöstrand, S.-E. (eds.), Aesthetic Leadership: Managing Fields of Flow in Art and Business. Palgrave Macmillan, Basingstoke, pp. 128–40. Harris, C. (1995) Art and Innovation: The Xerox PARC Artist-In-Residence Program. The MIT Press, Cambridge, MA. Heikkinen, M. (2005) Administrative Definitions of Artists in the Nordic oel of State Support for Artists. International Journal of Cultural Policy, 11, 325–40. Holquist, M. (2003) Dialogism and Aesthetics. In Gardiner, M.E. ( ed.), Mikhail Bakhtin, Vol. 1. Sage, Thousand Oaks, CA, pp. 367–85. Jeffcut, P. (2000) Management and the Creative Industries. Studies in Cultures, Organizations and Societies, 6, 123–27. Julier, G. (2000) The Culture of Design, Sage. Thousand Oaks, CA. Lanham, R.A. (2006) The Economics of Attention: Style and Substance in the Age of Information. University of Chicago Press, Chicago. Lindqvist, K. (2005) Att göra det främmande till sitt: Konstärer och arbetsplatser i samarbetsprojekt (Accomodating the unfamiliar: Artists and workplaces collaborating), Research Report, Department of Business Administration, Stockholm University. Linstead, S. and Höpfl, H. (eds.) (2000) The Aesthetics of Organization. Sage. Thousand Oaks, CA. Luhmann, N. (2000) Art as a Social System, trans. by E.M. Knodt. Stanford University Press, Stanford, CA. McClary, S. (1987) Talking Politics During the Bach Year. In Leppert, R. and McClary, S. (eds.), Music and Society: The Politics of Composition, Performance and Reception. Cambridge University Press, Cambridge, pp. 13–62. Macnaughton, J. (2007) Art in Hospital Spaces: The Role of Hospitals in an Aestheticised Society. International Journal of Cultural Policy, 13, 86–101. Madjar, N., Oldham, G.R. and Pratt, M.G. (2002) There’s No Place like Home? The Contributions of Work and Nonwork Creativity Support to Employees’ Creative Performance. Academy of Management Journal, 45, 757–67. Menger, P.-M. (1999) Artistic Labour Markets and Careers. Annual Review of Sociology, 25, 541– 74.
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Miller, W.C. (1999) Flash of Brilliance: Inspiring Creativity Where You Work. Perseus Books, Reading, MA. Mumford, M.D., Scott, G.M., Gaddis, B. and Strange, J.M. (2002) Leading Creative People. Orchestrating Expertise and Relationships. Leadership Quarterly, 13, 705–50. Nixon, S. (2005) Advertisement Culture. Sage, Thousand Oaks, CA. Nyström, H. (2000) The Postmodern Challenge: From Economic to Creative Management. Creativity and Innovation Management, 9, 109–14. Osbourne, T. (2003) Against ‘Creativity’: A Philistine Rant. Economy and Society, 32, 507–25. Piñeiro, E. (2007) Aesthetics at the Heart of Logic: On the Role of Beauty in Computing Innovation. In Guillet de Monthoux, P., Gustafsson, C. and Sjöstrand, S.-E. (eds.), Aesthetic Leadership: Managing Fields of Flow in Art and Business. Palgrave Macmillan, Basingstoke, pp. 105–27. Reeves, T.C., Duncan, W.J. and Ginter, P.M. (2001) Motion Study in Management and the Arts: A Historical Example. Journal of Management Inquiry, 10, 137–49. Ritzer, G. (2005) Enchanting a Disenachanted World: Revolutionizing the Means of Consumption, 2nd edn. Pine Forge Press, Thousand Oaks, CA. Roodhouse, S. (2006) The Unreliability of Cultural Management Information: Defining the Visual Arts. Journal of Arts Management, Law, and Society, 36, 48–65. Schiller, F. (1795/2004) On the Aesthetic Education of Man. Dover Publications, Mineola. Schumann, P.A. Jr. (1993) Creativity and Innovation in Large Organization. In Kuhn, R.L. (ed.), Generating Creativity and Innovation in Large Bureaucracies. Quorum Books, Westport, CN, pp. 111–30. Scott, S.G. and Bruce, R.A. (1994) Determinants of Innovative Behavior: A Path Model of Individual Innovation in the Workplace. Academy of Management Journal, 37, 580–607. Shalley, C.E. and Gilson, L.L. (2004) What Leaders Need to Know: A Review of Social and Contextual Factors That Can Foster or Hinder Creativity. Leadership Quarterly, 15, 33–53. Sharma, A. (1999) Central Dilemmas of Managing Innovation in Large Firms. California Management Review, 41, 146–64. Shklovsky, V. (1990) Theory of Prose, trans. by B. Sher. Dalkey Archive Press, Elmwood Park. Shusterman, R. (2006) Aesthetics. Theory, Culture & Society, 23, 237–52. Sternberg, R.J. (2003) WICS: A Model of Leadership in Organizations. Academy of Management Learning & Education, 2, 386–401. Strati, A. (1999) Organization and Aesthetics. Sage, Thousand Oaks, CA. Van Delinder, J. (2005) Taylorism, Managerial Control Strategies, and the Ballets of Balanchine and Stravinsky. American Behavioral Scientist, 48, 1439–52. Wolf, M.J. (1999) The Entertainment Economy: How Mega-Media Forces Are Transforming Our Lives. Penguin, London.
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Alexander Styhre (Alexander.Styhre@ chalmers.se) is professor at Chalmers University of Technology, Gothenburg, Sweden. He received his PhD from Lund University. Alexander is interested in the management of knowledge-intensive organizations and innovation work. He has published widely in organization theory and management studies journals and is the author, co-author and co-editor of ten books including The Innovative Bureaucracy (Routledge, 2007) and Managing Organization Creativity (Palgrave, 2005). Michael Eriksson is a PhD student at Chalmers University of Technology, Gothenburg, Sweden, and works for the Institute for Management of Innovation and Technology. He received an MSc in Engineering from Chalmers University of Technology. Michael is interested in the management of change and organizational creativity.
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Exploring the Effect of Cognitive Biases on Customer Support Services Heiko Gebauer, Regine Krempl and Elgar Fleisch In order to meet the increasingly more complex needs of customers and respond to decreasing product margins, product-oriented firms have developed a growing interest in extending their service business. Over the last couple of years, most product-oriented companies have explored the numerous opportunities offered by traditional customer service and productrelated services. Currently, these opportunities have reached a certain level of maturity. A number of practitioners and theorists stress the growing importance of customer support services. However, the entry point to the theorizing is the observation that very few productoriented firms have already innovated customer support services successfully. In most firms, cognitive biases limit the motivation of managers to facilitate creative potential for new customer support services. In this paper, four cognitive biases are elaborated through 12 mini-cases and 8 in-depth cases. The results suggest that disbelief in the financial potential, risk aversion, tendency to set over-ambitious objectives, and fundamental attribution error plays a critical role in creating customer support services. These four cognitive biases, and the key factors in overcoming them, provide guidance for managers who aim to facilitate creative potential for customer support services.
Introduction
I
ncreasingly more complex customer needs and decreasing product margins are currently putting pressure on traditional product-oriented companies to search for new business opportunities. One frequently suggested means of responding to these challenges is to extend the service business (Oliva & Kallenberg, 2003; Sawhney, Balasubramanian & Krishan, 2004; Neu & Brown, 2005). Over the last couple of years, most product-oriented companies have explored the numerous opportunities that both traditional customer service (CS) and product-related services (PRS) can provide. The notion of CS refers to Lovelock’s (1994) ‘flower of services’ framework, in which he depicts a seller’s total offering to a customer as an eight-petalled flower. The flower’s centre represents the seller’s basic product (goods or services), while its petals represent key elements of how the seller serves the customer. CS includes various aspects of facilitating supplementary services that are required for offering products (e.g., information, order taking, billing and payment). These services offer marketing
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opportunities by augmenting the product offering during the pre-sales and sales phases (Mathe & Shapiro, 1993; Kotler, 1994). PRS ensure the proper functioning in the aftersales phase. They refer to product description, documentation, transportation, productrelated training, inspection, spare parts and repair. PRS require fewer assets, are often counter-cyclical, and can provide higher margins than the products themselves (Oliva & Kallenberg, 2003). Both CS and PRS concentrate on the primary customer activity chain of operating products such as machines and pieces of equipment. In terms of the service opportunity matrix proposed by Sawhney, Balasubramanian and Krishan (2004), CS and PRS explore growth opportunities only by adding new service activities to the primary customer activity chain (see Figure 1). However, these opportunities have reached maturity. As a differentiation strategy, maintaining competitive advantages and achieving service-based growth advantages through CS and PRS are becoming increasingly challenging. In order to create new competitive advantages and exploit additional growth opportunities, product-oriented firms must © 2007 The Authors Journal compilation © 2007 Blackwell Publishing
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Service opportunity matrix Customer service (CS) Reconfiguration of existing activities How? (Type of growth) Adding new activities
Presales Sales
Service classification • Key elements of how the seller serves the customer • Various aspects of facilitating supplementary services that are required for offering products • Marketing opportunities by augmenting the product offering during the presales and sales phase • Examples are information, order taking, billing, payment
Product-related services (PRS)
After-Sales Primary activity chain
Complementary activity chain Where? (Focus of growth)
Note: The new service opportunities can be identified along two dimensions: the focus of growth (where does growth occur?) and the type of growth (how does growth appear?). The "where" question is typically answered by thinking about the primary, and complementary, or adjacent customer activity chains. The "how" question distinguishes into service opportunities first by adding new activities and second by reconfiguring existing activities. merging the focus of growth with the type of growth results in the two-by-two service opportunity matrix. The four elements of the framework include (1) temporal expansion: growth from services that add new activities to a primary activity chain, (2) spatial expansion: growth from services that add new activities to an adjacent chain, (3) temporal reconfiguration: growth from services that change the structure and control of activities within the primary chain, and (4) spatial reconfiguration: growth from services that change the structure and control of within an adjacent chain.
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• Ensure the proper functioning of the product • Require fewer assets, are often countercyclical and can provide higher margins than products • Concentrate on the after-sales phase in the primary customer activity chain • Examples are product description, documentation, transportation, productrelated training, inspection, spare parts, and repair
Customer support services (CSS) • Increase the efficiency and effectiveness of customers business processes • Concentrate either on reconfiguration of existing primary and adjacent customer activities or introducing new services in the adjacent opportunities spaces • Examples are taking-over customers' maintenance function, service level aggreements, technical advice for optimizing customers' operating processes, taking-over customers' spare parts management, hire personnel, using remote access to optimize customers' trouble shooting process, design and construction services, logistic services, business consulting, extensive training, or services for managing customers' installed base.
Figure 1. Service Opportunity Matrix and Service Classification
consider the ever-increasing expectations of customers and develop services that respond to them. As illustrated in Figure 1, new growth opportunities stem from services that change the structure and control of activities within the primary activity chain; such opportunities add new activities to the complementary or adjacent, customer activity chain, and change the structure and control of activities within the adjacent chain. Moreover, most customers not only expect the proper functioning of the product but also desire additional support to increase the efficiency and effectiveness of their business processes. In order to fulfil increasing customer expectations and address additional growth opportunities, product-oriented firms must shift the emphasis of their business from providing products with some CS and PRS to providing customer support services (CSS) (Oliva & Kallenberg, 2003; Windahl et al., 2004). However, the entry point to theorizing is the observation that very few product-oriented firms have already innovated CSS successfully. One major challenge to succeed in extending CSS is its conspicuous absence in the service development literature. Recent literature on service development (e.g., De Brentani, 2001; © 2007 The Authors Journal compilation © 2007 Blackwell Publishing
de Jong & Vermeulen, 2003; Matthing, Sandén & Edvardsson, 2004) concentrates mainly on traditional service firms. Academic research remains silent on the subject of innovative CSS in product-oriented companies. This study attempts to fill a part of this knowledge gap by addressing the following research question: How do cognitive biases limit the motivation of managers to facilitate creative potential for CSS? The paper is divided into four parts. First, a synthesis of the attention-based theory of the firm and valence-expectancy theory of motivation – two conceptual perspectives that are particularly relevant to the study – is provided, and the respective implications for CSS in product-oriented firms are highlighted. Then, the research methodology is explained. This is followed by a discussion of the results. The paper concludes by discussing implications for management and limitations of the study.
Theoretical Background Attention-Based Theory of the Firm The attention-based theory views firms as systems of structurally distributed attention in
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which the cognition and action of individuals are not predictable from the knowledge of individuals, but are derived from the specific organizational context and situations in which individual decision makers find themselves. From the managerial cognition perspective, the central argument is that the information processing capabilities of senior managers exert significant influence on a variety of organizational phenomena, including strategic decisions (Barr, Stimpert & Huff, 1992). Ocasio (1997), for example, argues that what decision makers do depends on what issues and answers they focus their attention on. Attention is defined as what occupies the consciousness of top managers or, in processual terms, as allocating information processing capacity to environmental stimuli over time (Sproull, 1984). The literature suggests that attention instigates complex cognitive biases that go beyond simply ‘paying attention’ to something (Daft & Weick, 1984; Ocasio, 1997). Attention includes the overt, visible steps of receiving and disseminating information that are captured in the commonplace phrase ‘paying attention to’ as well as the mental steps of noting and encoding information (Levy, 2005). According to the attention-based view of the firm, the following question arises: Why do firms undertake some strategy decisions and moves but not others? (Ocasio, 1997; Levy, 2005).
Valence-Expectancy Theory The literature contains various flavours of motivation. Theorists taking a cognitive approach offer the following model. Vroom (1964) suggested that the formulation for managerial motivation is Motivation = Expectancy * Valence * Instrumentality. Motivation is the product of three factors: (1) one’s estimate of the value of desired reward (valence); (2) one’s estimate of the probability that one’s effort will result in successful performance (expectancy); and (3) one’s estimate that the performance will result in receiving the reward (instrumentality).
Implications for CSS This paper views CSS in product-oriented firms as a strategic decision by which managers create new business opportunities. As illustrated in Figure 1, CSS change the focus of the value proposition to reconfiguration of the existing customer activity chain and the supplementary, adjacent customer activity chain. CSS not only ensure the proper functioning but also specifically help increase the efficiency and effectiveness of various
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customer processes (Mathieu, 2001). The attention-based view suggests that managers have to understand why they undertake the strategic decision to move into the CSS business. In addition, the cognitive approach to motivation theory suggests that managers will succeed in paying attention to CSS if they are motivated. Managers are motivated to create CSS when they place a high valence on them, are convinced of a high probability that their effort will result in successful performance, and when they believe that performance will result in receiving the reward.
Research Methodology To explore the role of cognitive biases during the innovation of CSS, an inter-disciplinary research approach that included case studies on developing CSS was employed (Eisenhardt, 1989). The whole research project was conducted using the method of grounded theory (Glaser & Strauss, 1967). The grounded theory, in general, aims at conceptually based explanations for the processes operating within the substantive problem area (Locke, 2001). All case studies focus on product-oriented firms. Their products, CS and PRS had generally reached the maturity stage, with the associated decreasing profit margins and overall profitability. These companies are confronted by increasing customer expectations in terms of additional support in and reconfiguration of the customer activity chain. Thus, all companies have been seeking possible means of exploiting the opportunities of CSS. From these case studies, a framework for the role of cognitive biases was developed (Strauss & Corbin, 1990). Consistent with grounded theory development and the goal to explore the effects of cognitive biases on customer support services framework patterns followed by firms that had attempted the development of customer support services, the data sampling was discriminate. First, firms were selected according to different types of CSS. As illustrated in Figure 2, the cases cover CSS addressing the adjacent customer activity chain by either adding new services or reconfiguring the adjacent customer activity chain. In addition, several cases concentrate on CSS for reconfiguring the primary customer activity chain. Second, firms were chosen according to their perceived success in the development of CSS. In general, the research design can be interpreted as a ‘T-design’ (Thölke, Hultink & Robben, 2001). For the horizontal axis of the ‘T-design’, 12 mini-cases were selected. These mini-cases involved 12 interviews with managers who © 2007 The Authors Journal compilation © 2007 Blackwell Publishing
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Mini-cases
Reconfiguration 1. Service level aggreements of existing activities 2. Taking-over customers maintenance function 3. Operational services to taking-over customers How? operating processes (Type of growth)
Indepth case studies
4. Fleet management of customers installed base 5. Taking-over customers‘ design and construction activities 6. Taking-over customers‘ personnel development
7. Advanced training services 8. Logistic services 9. Hire personnel 10. Design and construction services 11. Process optimization 12. Visability studies
Presales Adding new activities Sales
After-Sales Primary activity chain
Complementary activity chain
Reconfiguration of existing activities
B
Unsuccessful
E
F
A
D
H
How? (Type of growth)
Presales Adding new activities Sales G After-Sales Primary activity chain
Where? (Focus of growth)
In-depth case studies Company A Successful
C
Complementary activity chain Where? (Focus of growth)
Description¹ Company A is a supplier of machining centers and flexible manufacturing systems. Its customer produces mechanical components for aerospace, power generation, automotive industry and others. The demand for mechanical components fluctuates sharply. Thus, A has developed a innovative CSS called 'capacity support'. In case of a capacity bottleneck, the customer can authorize A to produce additional mechanical components.
Company B
Company B manufactures products for the generation and delivery of compressed air. B has developed a CSS called "delivery of compressed air". Company B takes over the operation of its compressors in the customer process and the customer pays for xm³/s of compressed air.
Company C
Company C is a supplier of production systems for the semiconductor industry. C has developed a CSS called 'preventive maintenance contract'. Customers signing up to these contracts benefit from improved operations and more reliable equipment availability.
Company D
Company D is a manufacturer of die casting machines . Its die casting machines are integrated into die casting cells including set of robots, a transfer line and items of equipment for heating, cooling and moving cast parts. D developed a CSS referred to as 'design and construction of the entire die casting cell'. This CSS optimizes the process from die casting-compliant design, cavity filling and solidification simulations to the achievement of high performance production.
Company E
Company E is a leading international parking systems company engaged in development, production, distribution and integration of innovative parking solutions.
Company F
Company F is a leading manufacturer of office furniture systems offering modular table, cabinet, shelf and wall systems as well as drawer units and caddies. Strong partner brands for lighting, seating and other special items are also available.
Company G
Company G manufactures weaving machines and drying plants for the paperboard, paper and gypsum fireboard industry as well as film stretching, rapier weaving, airjet weaving machines. The company is a market leader in plastic film production plants.
Company H
Company H is a leading manufacturer and system supplier for paper processing, with a main emphasis on superior paper handling and finishing in connection with high-performance digital printing systems, the development of innovative systems for web-finishing, as well as the production of advanced paper waste solutions.
¹ Note: In the interests of data confidentiality, the real CSS developments of the unsuccessful firms have not been revealed.
Figure 2. Overview of the Mini-Cases and In-Depth Case Studies
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Table 1. Results of the Mini-Cases Cognitive process
Number of mini-cases where the cognitive process was indicated as a major impact on managers decision to facilitate to potential of CSS
Disbelief in the financial potential Risk aversion Setting overambitious objectives Fundamental attribution error Overemphasing of conspicuous and tangible aspects of the environment Sunk-cost fallacy
had recently completed initiatives to exploit the opportunities of CSS. These mini-cases helped to answer the research question by specifying the cognitive biases. For the minicases, primary data were obtained through interview transcripts. Members of the following managerial functions participated in the 12 interviews: management board (5), R&D managers (3), service management (2) and sales (2). Based on the interview transcripts and secondary data, such as financial reports and internal documents, 12 mini-case studies were written, describing cognitive biases limiting CSS. The study proceeded by exploring the different cognitive biases using eight bi-polar, in-depth case studies (i.e., the vertical dimension of the T-design). The research team began by identifying four highly successful and four less successful companies. The expectation was that a comparison of successful and unsuccessful initiatives to develop CSS would help to identify how cognitive biases limit managers’ decisions to facilitate the potential of CSS (Eisenhardt, 1989). Successful companies were those that decided to explore the CSS opportunities. On the other hand, managers in unsuccessful companies were those who failed to decide to move into the CSS business. Focus groups were employed to collect high-quality data for the in-depth case studies. The following management functions participated in the focus groups: service management, product management, management board and sales. For each in-depth case study, two focus groups were conducted. The focus groups lasted between four and six hours with four or five participants. While the first author was writing down the results of the focus groups, participants were given the opportunity to provide additional written comments. The first author integrated the written comments of the participants in the case studies. In the interest of data confidentiality, the real
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12 12 11 11 1 1
names of the successful and unsuccessful firms have not been revealed. Figure 2 summarizes the mini-cases and in-depth case studies. The data collection and sampling of firms continued until a theoretical saturation was reached, i.e., until a recurring pattern of cognitive biases emerged from the cases (Strauss & Corbin, 1990).
Results Mini-Cases Traditional inductive research methods were used to analyse the data. A list of typical cognitive biases mentioned in the existing literature guided the data analysis (Kahneman, Slovic & Tversky, 1982; Plous, 1993; Baron, 2000; Gilovich, Griffin & Kahneman, 2002). The list included decision-making and behavioural biases (e.g., bandwagon effect, confirmation bias, loss aversion), biases in probability and belief (e.g., ambiguity effect, optimism bias, sub-additivity effect) and social biases (e.g., actor-observer bias, egocentric bias, self-fulfilling prophecy). The transcribed interview texts of the 12 mini-cases were coded, recoded and compared systematically and iteratively until the data were saturated and consistent structures emerged (Strauss & Corbin, 1990). An analysis of the 12 mini-cases revealed that four cognitive biases limit the managerial decision to innovate CSS: disbelief in the financial potential (12), risk aversion (12), tendency to set overambitious objectives (11), and the fundamental attribution error (11). These four cognitive biases recurred explicitly and systematically across the 12 cases (see Table 1). Other typical cognitive biases associated with the service business in product-oriented companies played only a minor role. The © 2007 The Authors Journal compilation © 2007 Blackwell Publishing
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over-emphasis of obvious and tangible characteristics refers to the fact that people have repeatedly been shown to pay undue attention to conspicuous and tangible aspects of the environment (Kahneman, Slovic & Tversky, 1982). This might explain whymanagers pay more attention to tangible products and PRS than to intangible CSS. However, only one interviewee reported that over-emphasis on obvious and tangible characteristics played a critical role. In addition, the sunk-cost fallacy (Arkes & Blumer, 1985) might explain why managers who have already invested in the product business invest further in it. Again, only one interviewee reported that sunk costs limited CSS. Finally, the other typical biases mentioned in the literature were also not mentioned as critical for the development of CSS. Thus, only the first four cognitive biases were analysed in more detail. The four cognitive biases can be substantiated through the existing literature. The disbelief in the financial potential and risk aversion can be described using prospect theory. Prospect theory is a psychological alternative to expected utility theory. It helps to describe how people make choices in situations where they have to decide between alternatives that involve risk. Furthermore, it describes how individuals evaluate potential losses and gains (Kahneman & Tversky, 1979). The inherent decision processes consist of two stages: (1) decision makers define the specific outcomes, and (2) estimate the risk and/or probability that the outcome will be generated. The disbelief in the financial potential represents a cognitive bias, making it difficult to specify the outcomes. Risk aversion is a general concept in economics, finance and psychology explaining the behaviour of consumers and investors under uncertainty. In this context, risk aversion is the reluctance of a person to accept a positive outcome with an uncertain payoff rather than another positive outcome with more certain but possibly lower expected payoff. Setting objectives is also part of a manager’s decision-making process. During this process, managers answer two basic questions: (1) what objective should be reached, and (2) when should the objective be reached. The literature recommends setting objectives that are specific, measurable, attainable, realistic and tangible. Setting an over-ambitious objective means that the goal was not realistic or that managers under-estimated the time needed to attain the goal. The fundamental attribution error can be substantiated through attribution theory. The fundamental attribution error is the tendency for people to over-emphasize dispositional, or personality-based explanations for behaviours observed in others while © 2007 The Authors Journal compilation © 2007 Blackwell Publishing
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under-emphasizing situational explanations. In the context of social psychology, people have an unjustified tendency to assume that a person’s actions depend on what ‘kind’ of person he/she is rather than on the social and environmental forces that influence the person. However, there is no universally accepted explanation for the fundamental attribution error. One possible explanation is that the error results largely from personal perspective. When a person observes other people, they serve as the primary reference point. When a person observes himself, he is more aware of the forces acting upon him. Consequently, the attribution for other people’s behaviour is more likely to focus on the obvious, not the situational forces acting upon the person that may not be obvious.
Disbelief in the Financial Potential The first cognitive bias relates to a disbelief in the financial potential offered by CSS. The understanding of CSS leading to higher overall profitability is limited by the disbelief that CSS revenue can constitute a major part of the value proposition in product-oriented companies. Compared to selling an item of machine equipment, selling CSS generates far less initial revenue. Company A, for example, creates additional revenue of between 20,000 and 50,000 Swiss francs by offering the production of additional mechanical components for customers in the event of a resource bottleneck. In contrast, selling the customer another flexible manufacturing system generates revenues of half a million Swiss francs. Furthermore, managers often believe that generating additional revenue through CSS can even lead to a loss in product revenue. When Company B additionally offered the operation of its compressors in its customer processes, the customers started to pay for x m3/s of compressed air. Customers no longer invested in compressors themselves, leading to a significant reduction in product revenue. According to Kahneman and Tversky’s (1979) prospect theory, managerial aversion to losing product revenues dominates managerial recognition of potential gains through CSS. In addition, generating potential gains through CSS poses a threat to the existing product sales organization. If managers increase service revenue by developing CSS, the authority, expertise, responsibilities or resources of traditional product sales will change (Ashforth & Lee, 1990). This potential threat to the sales organization leads to internal resistance to innovative CSS and high political costs for overcoming it. Even when managers recognize the additional revenue of
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CSS, they often believe that the political costs of exploiting it will be higher than the additional revenue earned. The lower total revenue for CSS compared to a piece of equipment, managerial aversion to losing product revenue and an over-estimation of the political cost of overcoming internal resistance to innovating CSS explain why managers may be sceptical about the financial potential of CSS. The outlined disbelief in the financial potential of CSS explains why managers do not place a high valence on exploiting them. Both successful and unsuccessful companies were confronted with the initial disbelief in the financial potential of CSS. While the successful companies became aware of the negative impact of disbelief and started deliberate actions to better understand the financial potentials of CSS, two unsuccessful companies never became aware of the limiting effect. Consequently, companies F and G failed to implement specific actions for gaining a better understanding of the financial potentials. The specific actions followed by companies A, B, C and D are described in the section on implications for research and practice.
Risk Aversion Because of the second cognitive bias on managerial estimation of CSS risks, managers also have difficulty in placing a high valence on exploiting CSS opportunities. In line with Einhorn and Hogarth’s (1985) argument on risk aversion, managers prefer less risky outcomes from investing mainly in the product, CS and PRS business to the more uncertain outcome of investing resources in developing CSS. When entering the competitive serviceproviding field, product-oriented companies face different competitors, namely, other service providers, distributors and their own customers. In order to be efficient in this new competitive environment, managers cannot simply transfer competitive advantages from the product to CSS. They must create new competitive advantages. Traditional productoriented companies create competitive advantages through technical competencies. Offering CSS creates competitive advantages that differ from strong technical competencies. They create integration, customer knowledge and partnering as well as specific applications and operational competencies. Unfortunately, managers in product-oriented firms often interpret these competencies as being beyond the scope of their traditional core competencies. Moreover, building up these competencies is not just beyond the scope of traditional
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manufacturing competencies, it also constitutes a potential threat for existing customers. Company B’s assumption of compressor operations in the customer process or company A’s production of mechanical components, for example, uses applications and operational competencies. These competencies are traditionally core competencies of their customers. By offering these CSS, both companies moved into direct competition with their own customers. This situation creates fundamental strategic risks for both companies in terms of losing existing customers. The delivery of company C’s preventive maintenance agreements means gaining intimate knowledge of the customer’s operation. This knowledge includes production process configurations, data about yield and up-time. It will be risky if customers are not willing to share this intimate knowledge with suppliers. Again, both successful and unsuccessful companies were confronted with the potential risks and management’s risk aversion. Companies E, G and H did not recognize the limiting effect of risk aversion on the development of CSS. In contrast, the four successful companies as well as company F became aware of the latter and used, for example, a detail gap analysis of existing competencies and those required for CSS to convince managers that CSS development is not beyond the scope of their competencies. In companies E, G and H, the management was never convinced that the competencies required for CSS are complementary to the existing competencies. As the field studies suggest, managers were averse to the potential risks inherent in the decision to develop CSS, and this explains why they did not place a high valence on them.
Setting Over-Ambitious Objectives The third cognitive bias limiting managerial decision making relates to setting overambitious objectives. This does not limit valence, but has a negative effect on managerial expectations that innovating CSS will lead to the intended results. In making judgements about the probability that offering CSS will lead to an increase in overall profitability, managers compare the observed results with their expectations (Cyert & March, 1992). Managerial perception of innovating CSS is more positive if progress in terms of overall profitability is high in relation to aspiration, and expectations are more negative when the progress is disappointing. Expectations are influenced by the objectives of the CSS business set by the managers themselves. Bowen, Siehl and Schneider (1989) highlighted the fact that product-oriented firms have not historically © 2007 The Authors Journal compilation © 2007 Blackwell Publishing
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included service-related goals. Due to lack of experience in setting goals for CSS development, most product-oriented companies find it difficult to set appropriate goals. In conformity with Kahneman and Lovallo’s findings (1993), managers commonly under-estimate the scope and difficulty of innovating CSS. Managers tend to set over-ambitious objectives and expect success in CSS sooner than is realistic. When objectives are set too high, expectations outstrip the observed increase in overall profitability, creating lower expectations that offering CSS will be the right decision. Company D, for example, expected results from its design and construction services sooner than was reasonable or realistic. Expectations outstripped the observed results, weakening managers’ conviction that CSS will create strong business opportunities. The excessively ambitious objectives created a credibility gap, confirming managers’ initial disbelief in the financial potential. Thus, a vicious cycle of goal erosion and disbelief in the financial opportunities set in. However, company D very soon became aware of the vicious cycle of goal erosion and deliberately started a redefinition of the objectives leading to more moderate objectives to avoid expectations that exceed the observed results. The unsuccessful companies E and F were also confronted with the vicious cycle of goal erosion, but were not aware of its causes. Instead of setting more realistic goals by using benchmarking, Program Evaluation and Review Technique or the Critical Path Method, they considered that the gap between observed results and expectation is caused by insufficient effort of the service workers.
Fundamental Attribution Error The fourth cognitive phenomenon refers to over-emphasizing employee orientation toward customer problems. It limits managers’ estimation that the performance will result in receiving the reward (instrumentality). Moving into CSS business requires changes to a series of organizational factors (e.g., increasing employee orientation to CSS and establishing a CSS development process). Unfortunately, the field studies suggest that managers merely concentrate on pushing employees to a higher orientation toward CSS. According to Ross’s (1977) Fundamental Attribution Error, managers attribute outcomes to people rather than to system structures. Managers tend to over-estimate the instrumentality that pushing employees toward a CSS orientation will lead to successful exploitation of the CSS business. They do not focus sufficiently on other antecedents for CSS. However, with© 2007 The Authors Journal compilation © 2007 Blackwell Publishing
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out a clear service development process, for example, any decision to facilitate the potential of CSS will fail. Company D, for example, initially thought that developing its CSS, referred to as ‘design and construction of the whole die-casting cell’, simply meant increasing employee orientation toward CSS. The manager responsible assumed that employees would develop complex pieces of equipment for die casting. To develop ‘design and construction of the whole die-casting cell’, they would have to think more in terms of customer-oriented design and construction processes. Needless to say, this approach did not bring about the intended success and led to an immediate reaction on the part of management. Instead of only forcing employees toward a higher CSS orientation, managers started to devote sufficient effort to establishing a CSS development process. The tendency to set over-ambitious goals for increasing overall profitability and to merely push employees to create a customer problem orientation explains why managers underestimated the probability that innovating CSS would result in better overall profitability. Again, both successful and unsuccessful companies were confronted with the fundamental attribution error. The difference between successful and unsuccessful companies relies on the awareness of the negative consequence of the fundamental attribution error on CSS development. While companies A, B, C and D became aware of it, the four unsuccessful firms failed to recognize the consequences. The awareness of the fundamental attribution error led to specific actions to encourage employees to be CSS oriented and to establish structures and processes necessary for the CSS business.
Comparison of Successful and Unsuccessful Companies A comparison with the four struggling, unsuccessful companies indicates how the cognitive biases can lead to CSS innovation’s success or failure. The unsuccessful companies failed to overcome the cognitive biases. As pointed out in the previous sections, both successful and unsuccessful companies were confronted with the four cognitive biases that can limit the managerial decision to exploit the opportunities of CSS. The explanation of why companies A, B, C and D are successful and E, F, G and H are not stems mainly from the awareness of the limiting effects of four cognitive biases. While the successful companies were aware of all limiting effects and started specific actions to overcome them, the unsuccessful ones were aware of only few cognitive biases. Company
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E, for example, was aware only of the negative consequence of the disbelief in the financial potential and started to overcome it. Company H has only overcome the disbelief in the financial potential and set adequate objectives to avoid the credibility gap. However, partial implementation of actions to avoid the cognitive biases does not lead to sufficient managerial motivation to facilitate the potential of CSS. At least one key factor to motivate managers (valence, expectancy or instrumentality) remains limited, leading to insufficient managerial motivation. In contrast, as illustrated in Table 2, the four successful companies finally succeeded in overcoming all four cognitive biases through various instruments. The description of the instruments is the key managerial implication (see Table 3). The instruments offer guidance for managers seeking to exploit CSS potential.
Implications for Research and Practice The findings suggest that managers seeking to exploit CSS should use the following instruments. In order to foster the belief in the financial potential of CSS, market surveys and interviews with customers should be used to obtain a comprehensive understanding of the financial potential of CSS. This means that managers should encourage their frontline staff to have frequent external contacts with customers in order to pave the way for opportunity exploration and the generation of new CSS ideas. External contact provides managers with the opportunity to collect feedback on discrepancies between customer activities and current service offerings. When frontline staff is educated to be sensitive to signals from clients relating to such discrepancies, belief in the financial opportunities becomes more likely. Furthermore, top management should help service managers to stimulate and encourage information sharing between different frontline workers. If information from different customer contacts is shared, as opposed to protected, and communication between different departments is fostered, this will lead to a better understanding of various CSS potentials. The exploitation of the financial potential of CSS poses a threat to the product sales organization, leading to political costs. However, managers should not over-estimate the possible political cost. Instead, they should focus on gaining acceptance in entering the CSS business. In order to increase acceptance of the CSS strategy and to overcome political costs, the existing product sales organization
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should be involved in the strategy formulation for CSS. Entering the CSS business should be a joint initiative of top management as well as the service and product sales organization. To co-ordinate the initiative between these different organizational units, it is important for the entire procedure to be systematic and transparent. This prevents any prejudices that the success of CSS business has a negative impact on responsibilities of the product sales organization. A detailed gap analysis of existing competencies and those required for CSS overcomes managers’ arguments that CSS are beyond the scope of their competencies. The risks of accessing intimate customer knowledge by offering CSS through the supplier of the product can be reduced by integrating the customer into the CSS development process. Customers should be integrated into the CSS development process throughout the various phases of idea creation, preliminary service concept, market test and market introduction. Furthermore, top management should also encourage the sharing of information between frontline managers and customers. If information is shared, as opposed to protected, customers’ avoidance of sharing intimate knowledge can be reduced. The field studies suggest that managers can avoid setting over-ambitious goals by using benchmarking with other firms, external experts and such techniques as the Program Evaluation and Review Technique and the Critical Path Method. These methods help managers to set realistic goals for CSS, leading to high expectations that managerial effort will generate the valence. Furthermore, the entire process of moving into the CSS business should be considered as a non-linear process, incorporating frequent feedback loops between the various phases of obtaining information on the CSS market, CSS strategy formulation, implementation and monitoring. Incorporating frequent feedback loops enables managers to make changes in goal-setting very easily. Easy changes in goal-setting and frequent feedback loops reduce the tendency of managers to set over-ambitious goals. To avoid the fundamental attribution error, managers should establish and empower a CSS innovation team. Empowering means giving the CSS innovation team the autonomy to develop CSS successfully. The innovation team uses its judgement to supervise particular CSS innovations and react to barriers to CSS innovation. Furthermore, typical quality improvement methods (e.g., Ishikawa diagrams or Deming’s Plan, Do, Act and Check cycle) assist managers in avoiding the fundamental attribution error. Ishikawa diagrams, © 2007 The Authors Journal compilation © 2007 Blackwell Publishing
© 2007 The Authors Journal compilation © 2007 Blackwell Publishing
Successful Company A Company B Company C Company D Unsuccessful Company E Company F Company G Company H
Companies
Cognitive biases
Factors to motivate managers to facilitate the potential of CSS
x x x x o x o o
x o o x
Overcoming the risk aversion
x x x x
Overcoming the disbelief in the financial potential
Valence
o o x x
x x x x
Setting adequate objectives avoiding the credibility gap
Expectancy
o o o o
x x x x
Balancing encouraging employees to be CSS oriented and establishing structures and processes necessary for the CSS business
Instrumentality
Table 2. Characteristics of Cognitive Biases Within Successful and Unsuccessful Companies (x = Overcoming the Cognitive Biases; o = Struggled to Overcome the Cognitive Biases)
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Table 3. Triggers to Overcome Cognitive Bias Cognitive processes
Triggers to overcome the limiting effect of the cognitive processes on managerial motivation to facilitate the potential of CSS
Disbelief in the financial potential
• Conducting market surveys and interviews with customers to obtain a comprehensive understanding of the financial potential of CSS • Encouraging frontline staff to have frequent external contacts with customers in order to pave the way for opportunity exploration and the generation of new CSS ideas • Assisting service managers to stimulate information sharing between different frontline workers in order to provide a better understanding of various CSS potentials • Gaining acceptance of entering the CSS business by involving the product sales organization in strategy formulation for CSS Risk aversion • Conducting a detailed gap analysis of existing competencies and those required for CSS to overcome managers’ arguments that CSS are beyond the scope of their competencies • Integrating the customer into various CSS development phases (e.g. idea creation, preliminary service concept, market test and market introduction) • Stimulating information sharing between frontline managers and customers to reduce customers’ avoidance of sharing intimate knowledge Setting overambitious • Using benchmarking with other firms and external experts to set objectives appropriate goals • Using techniques as the Program Evaluation and Review Technique and the Critical Path Method for defining adequate goals • Incorporating frequent feedback loops to change goal setting very easily Fundamental • Establishing CSS inovation teams attribution error • Giving the CSS inovation team the autoomy to implement antecedents to develop CSS • Using typical quality improvement methods to clearly indicate the successive hurdles to exploit the CSS business
for example, help to indicate clearly the successive hurdles to exploiting the CSS business. The use of such methods enables managers to concentrate their efforts on defining a CSS development process and empowering employees to be more customer problemoriented. Thus, these methods limit the negative impact of the fundamental attribution error on managerial motivation. The cognitive biases offer a complementary perspective on the traditional service development literature (Brentani, 2001; de Jong & Vermeulen, 2003). To the best of the authors’ knowledge, this is the first study which investigates the influence of cognitive biases on managerial decisions to facilitate the potential of CSS business in typical product-oriented companies. Through the 12 mini-cases of product-oriented companies, four cognitive
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biases were identified: disbelief in the financial potential, risk aversion, the tendency to set over-ambitious objectives and the fundamental attribution error. The research team further investigated these four cognitive biases by means of the eight in-depth bipolar case studies. These case studies clearly indicated the limiting effect of the cognitive biases. Moreover, the experiences of the successful companies led to various instruments for overcoming the limiting effect. These instruments provide guidance for managers wishing to facilitate creative potential for CSS. By focusing on the cognitive biases inherent in the managerial decision to facilitate the creative potential of CSS, we have not explained in detail the necessary organizational antecedents to develop CSS, which are considered beyond the scope of this paper. The objective © 2007 The Authors Journal compilation © 2007 Blackwell Publishing
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was merely to explain the cognitive dimension of CSS. The effect of cognitive biases on managerial motivation to exploit CSS opportunities offers a complementary perspective to existing theories on service development and service management. It suggests that despite the demonstrated benefits of CSS, managerial motivation to enter the solution provider business does not happen automatically. This tends to be a process of overcoming typical and, in some respects, counterproductive cognitive biases in product-oriented companies. Nevertheless, the findings have some clear limitations. The main focus was on the 12 mini-cases and 8 in-depth cases, and the remarks were limited to them. However, within grounded theory, the number of cases is not relevant as long as the patterns observed in the data are not incidental. Testing in other substantive areas needs to be carried out in order to generalize the cognitive biases identified here. This is beyond the scope of the research project presented here. Nevertheless, the research team recommends that its findings be applied to other companies and branches of industry which are confronted with similar problems.
References Arkes, H. and Blumer, C. (1985) The Psychology of Sunk Cost. Organizational Behavior and Human Decision Processes, 35, 124–40. Ashforth, B. and Lee, R.T. (1990) Defensive Behavior in Organizations: A Preliminary Model. Human Relations, 43, 621–48. Baron, J. (2000) Thinking and Deciding, 3rd edn. Cambridge University Press, New York. Barr, P., Stimpert, J. and Huff, A. (1992) Cognitive Change, Strategic Action, and Organizational Renewal. Strategic Management Journal, 13, 15–36. Bowen, D.E., Siehl, C. and Schneider, B. (1989) A Framework for Analyzing Customer Service Orientations in Manufacturing. Academy of Management Review, 14, 75–95. Brentani De, U. (2001) Innovative Versus Incremental New Business Services: Different Keys for Achieving Success. Journal of Product Innovation Management, 18, 169–88. Cyert, R. and March, J. (1992) A Behavioural Theory of the Firm, 2nd edn. The MIT Press, Cambridge, MA. Daft, R.L. and Weick, K.E. (1984) Toward a Model of Organizations as Interpretation Systems. Academy of Management Review, 9, 284–95. de Jong, J.P.J. and Vermeulen, P.A.M. (2003) Organizing Successful New Service Development: A Literature Review. Management Decision, 41, 844– 58. Einhorn, H. and Hogarth, R. (1985) Ambiguity and Uncertainty in Probabilistic Inference. Psychological Review, 92, 433–61. © 2007 The Authors Journal compilation © 2007 Blackwell Publishing
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Eisenhardt, K.M. (1989) Building Theories from Case Study Research. Academy of Management Review, 14, 532–50. Gilovich, T., Griffin, D. and Kahneman, D. (eds.) (2002) Heuristics and Biases: The Psychology of Intuitive Judgment, Cambridge University Press, Cambridge. Glaser, B.G. and Strauss, A.L. (1967) The Discovery of Grounded Theory: Strategies for Qualitative Research. Aldine, Chicago, IL. Kahneman, D. and Lovallo, D. (1993) Timid Choices and Bold Forecasts: A Cognitive Perspective on Risk-Taking. Management Science, 39, 17–31. Kahneman, D. and Tversky, A. (1979) Prospect Theory: An analysis of decision under risk. Econometrica, 47, 263–92. Kahneman, D., Slovic, P. and Tversky, A. (1982) Judgement under Uncertainty: Heuristics and Biases, Cambridge University Press, Cambridge, MA. Kotler, P. (1994) Marketing Management: Analysis, Planning, Implementation and Control, 8th edn. Prentice-Hall, Englewood Cliffs, NJ. Levy, O. (2005) The Influence of Top Management Team Attention Patterns on Global Strategic Posture of Firms, Journal of Organizational Behavior, 26, 797–819. Locke, K. (2001) Grounded Theory in Research Management. Sage Publications, London. Lovelock, C. (1994) Product Plus: How Product + Service = Competitive Advantage. McGraw-Hill, New York. Mathe, H. and Shapiro, R.D. (1993) Integrating Service Strategy in the Manufacturing Company. Chapman & Hall, London. Mathieu, V. (2001) Product Services: From a Service Supporting the Product to a Service Supporting the Client. Journal of Business and Industrial Marketing, 16, 39–58. Matthing, J., Sandén, B. and Edvardsson, B. (2004) New Service Development: Learning from and with Customers. International Journal of Service Industry Management, 15, 479–98. Neu, W. and Brown, S. (2005) Forming Successful Business-to-Business Services in GoodsDominant Firms. Journal of Service Research, 8, 3–17. Ocasio, W. (1997) Toward an Attention-Based View of the Firm. Strategic Management Journal, 18, 187– 206. Oliva, R. and Kallenberg, R. (2003) Managing the Transition from Products to Services. International Journal of Service Industry Management, 14, 160– 72. Plous, S. (1993) The Psychology of Judgment and Decision Making. McGraw-Hill, New York. Ross, L. (1977) The Intuitive Psychologist and His Shortcomings: Distortions in the Attribution Process. In Berkowitz, L. (ed.), Advances in Experimental and Social Psychology, Vol. 10. Academic Press, New York, pp. 174–220. Sawhney, M., Balasubramanian, S. and Krishan, V. (2004) Creating Growth with Services. Sloan Management Review, 45, 34–43. Sproull, L.S. (1984) The Nature of Managerial Attention. Advances in Information Processing. Organizations, 1, 9–27.
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Strauss, A. and Corbin, J. (1990) Basics of Qualitative Research: Grounded Theory Procedures and Techniques. Sage Publications, Newbury Park, CA. Thölke, J., Hultink, E. and Robben, H. (2001) Launching New Product Features: A Multiple Case Examination. The Journal of Product Innovation Management, 18, 3–14. Vroom, V. (1964) Work and Motivation. John Wiley & Sons, New York. Windahl, C., Andersson P., Berggren, C. and Nehler, C. (2004) Manufacturing Firms and Integrated Solutions: Characteristics and Implications. European Journal of Innovation Management, 7, 218–28.
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Heiko Gebauer (
[email protected]) is a project manager in the Institute of Technology Management at the University of St. Gallen. His research explores how manufacturing companies extend the service business. Regine Krempl (regine.krempl@unisg. ch) is a PhD student in in the Institute of Technology Management at the University of St. Gallen. Her research focuses on the development of innovative healthcare services. Elgar Fleisch (
[email protected]) is a professor of Technology Management and director of the Institute of Technology Management at the University of St. Gallen (HSG) and professor of Information Management at the ETH Zurich.
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Employee Creativity and R&D: A Critical Review Ming-Huei Chen and Geir Kaufmann Employee creativity is one of the most important components to measure a company’s human capital, particularly in knowledge-intensive companies. However, the complexity of the conception of creativity means that the measurement of employee creativity has become difficult. Reflecting discussions and contributions on Creativity in R&D as presented at the 2006 R&D Management Conference held in Taiwan, this short thematic paper reviews four different and critical approaches to creativity, namely the evolutionary approach, the cross-disciplinary science approach, the social system approach and the social network approach. This paper concludes that the four approaches provide complementary contributions in understanding the measurement of creativity in an R&D context, but that the interaction of the socio-cultural context with employee creativity needs to be taken into account.
Introduction
T
he rise of a knowledge-based economy is attributed to the increasing importance of employee creativity, one of a company’s intangible and most important assets, for its sustainable competitive advantage (Petty & Guthrie, 2000). Employee creativity is also regarded as one of the most important elements of a company’s human capital in keeping the body of knowledge alive and vibrant, and to secure the company’s well-being and long-term viability (Wiig, 1997). Creative performance, representing the growth and decline of intellectual capital, can be measured both by what is in the heads of organizational members, and by what remains in the company when they leave. However, the complexity of the conception of employee creativity and the lack of a universal definition of creativity make the measurement of creativity more difficult. For instance, Csikszentmihályi (1990) claimed that creativity is essentially an interaction between a person’s thought and a socio-cultural context, and almost all creativity involves group processes. Gardner (1988) argued that it is futile to study creativity at a single level of explanation, isolating a single element in a mental process, a personality characteristic, or a cultural context. Similarly, Kasof (1995) pointed out that the limitation of creativity within the individual is consistent with a variety of cognitive or attribu© 2008 The Authors Journal compilation © 2008 Blackwell Publishing
tional biases that lead to a tendency towards isolation from the social or environmental context of creativity. Therefore, studying employee creativity in an R&D context should be regarded as a multifaceted social phenomenon (Isaksen, 1987), since it emphasizes employee interaction, encourages a climate of sharing ideas, skills and knowledge, and stimulates creative outputs (Rickards, 1991; Kratzer, Leenders & van Engelen, 2006; Chen, Chang & Hung, 2008). This paper focuses on the issue of employee creativity in an R&D context, and will review several critical approaches to the issue. The paper reflects discussions and contributions on Creativity in R&D as presented at the 2006 R&D Management Conference held in Taiwan, and was written as a theoretical introduction to the paper by Steve Boehlke, also originating from the Taiwan conference, presenting a practitioner’s view of the politics in facilitating creativity in an R&D organization. This paper is in two parts. The first part focuses on the difficulties of measuring employee creativity, and the second part reviews several critical approaches to employee creativity in an R&D context.
The Difficulties of Measuring Employee Creativity The term creativity is used in different ways and the definition is formulated in different
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respects. Creativity has many synonyms, such as productive thinking, divergent thinking, originality, imagination, brainstorming, etc. Some definitions of creativity have served as a starting point for theoretical and empirical investigations, but often they are ambiguous or non-operational (Ackoff & Vergara, 1981). Isaksen (1987) argued that some definitions are in conflict with each other, promoting confusion rather than improving understanding (Isaksen, 1987). Rickards (1991) also claimed that there is a lack of rigorous thinking about the term creativity, and there is therefore a danger that the term may degenerate completely into a single, blurred, catch-all concept. This section will highlight the difficulties of measuring employee creativity. In the consensual assessment technique, creativity is defined in conceptual and operational ways and the importance of specifying the relation between the operational and conceptual definitions of creativity is stressed (Amabile, 1983). The conceptual definition articulates the notion of creativity that underlies the theoretical framework which explains how the crucial characteristics of creative products evolve in the process of task engagement (Amabile, 1983). A satisfactory operational definition must return to the final criterion for creativity assessment, a reliability on a person’s subjective judgement. In operational terms, ‘creativity can be regarded as the quality of products or responses judged to be creative by appropriate observers, and it can also be regarded as the process by which something so judged is produced’ (Amabile, 1983, p. 359). Moreover, Amabile (1994) argued that in the scientific research, all researchers are limited to some degree by their environmental context, and that empirical analysis of creativity studies still requires more rigorous work, primarily concerning the role of epistemology and philosophy (Amabile, 1994), since creativity is a dynamic concept, which changes through our experience, domain knowledge and context (Isaksen, Puccio & Treffinger, 1993). The topic of creativity in the R&D literature has evolved along a path similar to that of the organizational psychology field. From an organizational psychology perspective, theories of creativity have progressed from static, contentoriented theories to dynamic, process-oriented theories (Campbell et al., 1970). Content theories search for the specific things within individuals that initiate, direct, sustain and terminate behaviour, but process theories explain how behaviour is initiated, directed, sustained and terminated. There are diverse views on the concept of creativity and its sub-concept cannot be understood from one single per-
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spective. It is not the purpose of this paper to provide a historical review of all of the conceptions of creativity, but rather examines a number of critical approaches to creativity research, namely the evolutionary approach, the cross-disciplinary science approach, the systematic approach and the social network approach.
The Critical Approaches to Measuring Employee Creativity in an R&D Context The critical approaches to studying employee’s creativity in an R&D context are identified, namely: 1. the evolutionary approach, as suggested by Campbell (1960), Kaufman (1975), Quadagno (1979), McKelvey (1982), Amabile (1983) and Staw (1990); 2. the cross-disciplinary approach, as suggested by Gardner (1988) and MagyariBeck (1990); 3. the social system approach, as suggested by Tardif and Sternberg (1988), Csikszentmihályi (1990) and Woodman, Sawyer and Griffin (1993); 4. the social network approach, as suggested by Simonton (1984), Mumford (2002), Leenders, van Engelen & Kratzer (2003), PerrySmith (2003), Kratzer, Leenders and van Engelen (2006), and Chen, Chang and Hung (2008).
Evolutionary Approach to Creativity in an R&D Context Campbell (1960) argued some theories of evolution focused on describing the course of socio-cultural evolution, without reference to evaluation and moralisms. He further depicted the evolutionary model as ‘blind variation and selective retention’ to rectify the gap and to explain natural selection in the socio-cultural evolution. Kaufman (1975) observed that the biological evolutionary metaphor fits remarkably well and explains why human institutions ostensibly created and controlled by people seem to be governed by a momentum of their own. Quadagno (1979) argued that evolution embodies many principles of change, order, direction, progress and perfectibility, with each principle being present in some but not all theories of evolution. McKelvey (1982) argues that the important concept of population is © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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ignored in Campbell’s model. Although there are arguments in Campbell’s evolutionary theory, his natural selection theory has been elevated to a more central position and attracted the attention of influential scholars. Taking an evolutionary approach, creativity can be defined as a product of blind variation and selective retention process, which implies that employee creativity is the creative solution only by using a diverse set of alternatives and trial and error (Staw, 1990). However, individuals can use a variety of mechanisms to input to the problem process, such as task motivation, persistence, non-conformity, field independence, cognitive complexity, breadth of experience and knowledge. In the retention process, individuals can use strategic choice in their adaptation, such as general intelligence, self-criticism skills and high standards. Amabile’s (1983) componential model of creative problem solving at the individual level makes implicit use of the evolutionary approach in the content variables of measuring creativity (Staw, 1990). Moreover, Amabile’s (1983) empirical work on intrinsic motivation emphasizes how work environment, external pressure, incentive structures and organizational structure can stimulate and inhibit creative responses or outputs. In her componential framework, Amabile (1983) reviewed many of the personality and environmental variables of individual creativity and placed them into a sequence of problem-solving steps. Three sets of determinants of individual creative performance are intrinsic motivation, domainrelevant skills and creative skills. Staw (1990) restated Amabile’s problem-solving sequence to be presenting variation and retention processes on the evolutionary framework. Specifically, the task motivation variables, including quantity- and quality-oriented ones, can broaden employees’ presentation or discovery of problems, and generation of alternative solutions. Domain-relevant skills are regarded as affecting the generation of alternatives and the selection of preferred solutions. Creativityrelevant skills affect the generation of alternatives, their selection and one’s responses to failure. However, creative problem solving can be seen as a social act that is subject to both environmental and personal influence, rather than characterizing creativity strictly as the personality characteristics and cognitive process applying to all situations (Staw, 1990). Therefore, from an evolutionary approach, employee’s creativity in an R&D context can be defined as a social process of variation and selective retention, which is subject to employees’ preferences, socialization and environmental determinants. © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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Cross-Disciplinary Science Approach to Creativity in an R&D Context Creativity is a phenomenon much like prodigiousness and requires to be dealt with by drawing on a combination of different disciplines and perspectives (Gardner, 1988). Some researchers, like Gardner (1988) and MagyariBeck (1990), articulate creativity as an elusive and complex phenomenon, and a multidiscipline scientific approach to illuminate creativity has provided a more holistic scope than does a single discipline and perspective. Gardner (1988) applied a ‘synthetic’ science approach which encompasses interdisciplinary efforts to seek to illuminate a complex phenomenon as creativity, rather than using a single scientific view, such as cognitive science, psychological approaches, historicalcultural and biological views. Cognitive science has been used to tackle major cognitive issues ranging from the nature of perception to assessment of human rationality, but makes little contribution to present studies. Drawing on the cases of the creative person studied by Freud, it is argued that a psychological perspective to such a creative individual might begin with an examination of the cognitive strengths of the subject, and end up with the intelligence and the person (Gardner, 1988). However, the multiplicity of factors that interact and contribute to the achievement of human creativity needs to be carried out using various cognitive, personality and social factors, not simply taking a single psychological view. Magyari-Beck (1994) used ‘creatology’, a term coined for a new cross-disciplinary science of creativity, to emphasize that creative product is the application of certain basic cultural paradigms of that culture for which the creative product in question was created. The results of creativity studies need to take the basic cultural paradigms into account, although such paradigms can severely limit creative thinking, and cannot be reduced to psychological phenomena. Creativity was classified into four taxonomies, attributed to Rhodes (1961), whose four Ps was a remarkable step forward in the process of helping understand the creative process and products. Rhodes (1961) set out to analyse creativity by collecting 40 definitions of creativity and 16 of imagination. He clustered these into four groups: person-centred, process-centred, press-centred and productcentred (which became the renowned 4Ps of creativity). Rhodes (1987) has suggested that much conceptual confusion about his 4P model was due to a failure by researchers to recognize in their definitions that ‘each strand
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has unique identity academically, but only in unity do the four strands operate functionally (1987, p. 218). Furthermore, Magyari-Beck (1990, 1994) argued that the four Ps approach cannot to be studied by psychological phenomenon alone, where people are only a part of the whole context. Other entities need to be considered, such as culture, organization and group. From a cross-disciplinary science approach, it can be concluded that a background in different cultural paradigms becomes a kind of logical universe to scientific problems and solutions. A synthetic science encompasses a multiplicity of science to illuminate the complex phenomenon of creativity. The science of creativity extends beyond cognitivepsychological boundaries and cannot be limited to study in a single discipline, but requires consideration from other disciplines, such as sociology, theories of organizations, economics, history, metrology and cultural paradigm. Therefore, from a cross-disciplinary approach, in studying employee creativity in an R&D context, it is necessary to consider the employees’ different backgrounds, experiences, skills, knowledge and cultures.
Social System Approach to Creativity in an R&D Context Tardif and Sternberg (1988) defined creativity in a social context as existing in the larger system of social networks, problem domains and fields of enterprise. It does not preclude the individual view, but provides additional insights regarding creative persons and products and their function in society as a whole (Tardif & Sternberg, 1988, p. 429). It is believed that using a systematic investigation of creative behaviour in complex social systems provides key understanding to organizational sciences. Woodman, Sawyer and Griffin (1993), therefore, view organizational creativity in a systematic approach that organizational creativity is defined as a subset of the broad domain of innovation, and innovation is then characterized as a subset of an even broader construct of organizational change. In their interactionist model, Woodman, Sawyer and Griffin (1993) integrate five constructs as a subset of a social context, such as (a) the creative process, (b) the creative product, (c) the creative person, (d) the creative situation, and (e) the way in which each of these components interacts with the others. Similarly, Csikszentmihályi (1990) contended that it is impossible to define creativity independently of a judgement based on criteria that change from domain to domain and across time, insisting that creativity ‘is not an
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attribute of individuals but of social systems making judgments about individuals’ (p. 199). In other words, creativity does not happen inside people’s heads, but in the interaction between a person’s thoughts and a sociocultural context. Creativity can be viewed as a systemic rather than an individual phenomenon. He used a systemic view to conceptualize a dynamic model, with creativity as the result of the interaction between three subsystems: a domain, a field and a person. The domain consists of a set of symbolic rules and procedures; the field includes all the individuals who act as gatekeepers to the domain; and the individual person. Therefore, from a systematic approach, studying creativity in an R&D context needs to concern the individual level, team level and organizational level which all interact with each other within a wider social system.
Social Network Approach to Creativity in an R&D Context Simonton (1984) asserted that ‘a successful social psychology of creativity demands that the creative individual be placed within a network of interpersonal relationships’ (p. 1273). Relationships are generally created through exchanges between team members. The pattern of linkages and the relationships built through exchanges are the foundation for social capital (Nahapiet & Ghoshal, 1998; Gabbay & Leenders, 1999). Within an organization, the current increased emphasis on teamwork and various forms of job sharing ensures that knowledge workers must interact with others to get their jobs done. The innovation-related research at the firm and group levels provides some suggestion that social relationships are important for creativity (Tushman, 1977; Monge, Cozzens & Contractor, 1992). Mumford (2002) used the term social innovation to explain how people organize social interactions to meet common goals as a critical issue to the generation and implementation of new ideas. He also explained that social innovation might involve the creation of new processes and procedures for structuring collaborative work, the introduction of new social practices in a group, or the development of new business practices. Similarly, Leenders, van Engelen and Kratzer (2003) take a social network perspective to examine the relationship between a team’s communication and team creativity. They found that team creativity requires a moderate frequency of communication and a low level of communication centralization. One recent study by Chen, Chang and Hung (2008) found that social © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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interaction and network ties had significant and positive impacts on creativity of R&D project teams. The importance of weak ties on creativity has been reported in the literature. For instance, Perry-Smith and Shalley (2003) found that weaker relationships, those involving comparatively low levels of closeness and interaction, may be particularly beneficial for creativity despite the intuitive ‘strength’ of strong ties. Weaker connections may be associated with non-redundant information, and this access to more non-redundant information should enhance domain-relevant knowledge. Moreover, the access to heterogeneous social circles that weak ties provide should facilitate a variety of processes helpful for creativity (Perry-Smith & Shalley, 2003). From a social network approach, employee creativity in an R&D context concerns employees’ interaction within a network of interpersonal relationships.
Conclusions Most creativity studies focus on an individual cognitive process which has made a significant contribution to understanding individual cognitive processes and individual–environment interactions by taking psychometric and cognitive approaches. However, the limitation of creativity at the individual level leads to a tendency towards isolation from social and environmental contexts. The conceptions of creativity are dynamic and complex, and change through our experiences, domain knowledge and socio-cultural contexts. Therefore, it is not appropriate to study employee creativity through a single lens and a multidisciplinary approach is recommended. The evolutionary approach suggests that employee creativity can be measured as a social process of variation and selective retention, which is subject to employee preferences, socialization and environmental determinants. The crossdisciplinary approach argues that the study of employee creativity cannot be limited to study in psychological phenomena but different cultural paradigms and other discipline sciences need to be considered. The social system approach argues employee creativity is defined in a social context, but does not preclude the individual view, as creativity exists in the larger system of social networks, problem domains, fields of enterprise, and treats creative persons and products and their function in society as a whole. The social network approach suggests that a successful social psychology of creativity demands that the creative individual be placed within a network of interpersonal relationships. © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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We have learned that there it is lack of a universally acceptable definition of the concept of creativity; however, the four critical and different approaches to creativity provide complementary contributions to understanding the measurement of creativity in an R&D context.
References Ackoff, R.L. and Vergara, E. (1981) Creativity in Problem-Solving and Planning. European Journal of Operational Research, 7, 1–13. Amabile, T.M. (1983) The Social Psychology of Creativity: A Componential Conceptualization. Journal of Personality and Social Psychology, 45, 357–76. Amabile, T.M. (1994) Recognizing Creativity: A Reply to Magyari-Beck. Creativity and Innovation Management, 3, 244–45. Campbell, D.T. (1960) Blind Variation and Selective Retention in Creative Thought as in Other Knowledge Processes. Psychological Review, 67, 380–400. Campbell, J.P., Dunnette, M.D., Lawler, E.E. and Weick, K.E. (1970) Managerial Behavior, Performance, and Effectiveness. McGraw-Hill, New York. Chen, M.-H., Chang, Y. and Hung, S. (2008) Social Capital and Creativity in R&D Project Teams. R&D Management, 38, 21–34. Csikszentmihályi, M. (1990) The Domain of Creativity. In Runco, M.A. and Albert, R.S. (eds.), Theories of Creativity. Sage, Newbury Park, CA, pp. 190–212. Gabbay, S.M. and Leenders, R.Th.A.J. (1999) CSC: The Structure of Advantage and Disadvantage. In Leenders, R.Th.A.J. and Gabbay, S.M. (eds.), Corporate Social Capital and Liability. Kluwer Academic Publishers, London, pp. 1–14. Gardner, H. (1988) Creative Lives and Creative Works: A Synthetic Scientific Approach. In Sternberg, R.J. (ed.), The Nature of Creativity: Contemporary Psychological Perspectives. Cambridge University Press, Cambridge, pp. 298–321. Isaksen, S.G. (1987) Frontiers of Creativity Research: Beyond the Basics. Bearly, Buffalo, NY. Isaksen, S.G., Puccio, G.J. and Treffinger, R.L. (1993) An Ecological Approach to Creativity Research: Profiling for Creative Problem Solving. Journal of Creative Behavior, 27, 149–70. Kasof, J. (1995) Explaining Creativity: The Attributional Perspective. Creativity Research Journal, 8, 311–66. Kaufman, H. (1975) The Natural History of Organizations. Administration and Society, 7, 131–49. Kratzer, J., Leenders, R.Th.A.J. and van Engelen, J.M.L. (2006) Team Polarity and Creative Performance in Innovation Teams. Creativity and Innovation Management, 15, 96–104. Leenders, R.Th.A.J., van Engelen, J.M.L. and Kratzer, J. (2003) Virtuality, Communication, and New Product Team Creativity: A Social Network Perspective. Journal of Engineering Technology Management, 20, 69–92.
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McKelvey, B. (1982) Organizational Systematics – Taxonomy, Evolution, Classification. University of California Press, Berkeley, CA. Magyari-Beck, I. (1990) An Introduction to the Framework of Creatology. Journal of Creative Behavior, 24, 151–60. Magyari-Beck, I. (1994) Creativity Studies and their Paradigmatic Background. Creativity and Innovation Management, 3, 104–9. Monge, P.R., Cozzens, M.D. and Contractor, N.S. (1992) Communication and Motivational Predictors of the Dynamics of Organizational Innovation. Organization Science, 3, 250–74. Mumford, M.D. (2002) Social Innovation: Ten Cases from Benjamin Franklin. Creativity Research Journal, 14, 253–66. Nahapiet, J.E. and Ghoshal, S. (1998) Social Capital, Intellectual Capital, and the Organizational Advantage. Academy of Management Review, 23, 242–66. Perry-Smith, J.E. and Shalley, C.E. (2003) The Social Side of Creativity: A Static and Dynamic Social Network Perspective. Academy of Management Review, 28, 89–106. Petty, R. and Guthrie, J. (2000) Intellectual Capital Literature Review: Measurement, Reporting and Management. Journal of Intellectual Capital, 1, 155– 76. Quadagno, J.S. (1979) Paradigms in Evolutionary Theory: the Sociobiological Model of Natural Selection. American Sociological Review, 44, 100–9. Rhodes, M. (1961) An Analysis of Creativity. Phi Delta Kappan, April, 305–10. Rhodes, M. (1987) An Analysis of Creativity. In Isaksen, S.G. (ed.), Frontiers of Creativity Research: Beyond the Basics. Bearly, Buffalo, NY, pp. 216–22. Rickards, T. (1991) Innovation and Creativity: Woods, Trees and Pathways. R&D Management, 21, 97–108. Simonton, D.K. (1984) Artistic Creativity and Interpersonal Relationships across and within Generations. Journal of Personality and Social Psychology, 46, 1273–86. Staw, B.M. (1990) An Evolutionary Approach to Creativity and Innovation. In West, M.A. and Farr, J.L. (eds.), Innovation and Creativity at Work: Psychological and Organizational Strategies. John Wiley, London.
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Tardif, T.Z. and Sternberg, R.J. (1988) What do we Know about Creativity? In Sternberg, R.J. (ed.), The Nature of Creativity: Contemporary Psychological Perspectives. Cambridge University Press, Cambridge, pp. 429–40. Tushman, M.L. (1977) Special Boundary Roles in the Innovation Process. Administrative Science Quarterly, 22, 587–605. Wiig, K.M. (1997) Integrating Intellectual Capital and Knowledge Management. Long Range Planning, 30, 399–405. Woodman, A.W., Sawyer, J.E. and Griffin, R.W. (1993) Toward a Theory of Organizational Creativity. Academy of Management Review, 18, 293– 321.
Ming-Huei Chen (
[email protected]. edu.tw) is an Associate Professor at the Graduate Institute of Technology & Innovation Management, National Chung Hsing University, Taiwan. Dr Chen teaches graduate level and EMBA Creativity and Innovation Management courses, and lectures creative problem-solving methods in company training programmes. She completed her PhD at the Manchester Business School, University of Manchester, UK, in 2001, and an MBA and an MSc (Business Education) at Southern New Hampshire University in the United States in 1992, and holds a bachelor of Business Education from National Changhua University of Education in Taiwan in 1990. Geir Kaufmann is Professor of Psychology at the Norwegian School of Economics and Business Administration. His major research interests are in the field of managerial and organizational cognition, with a particular emphasis on creativity in a business context. Currently he is engaged in developing and testing a model of the effects of mood on creative problem solving in organizational behaviour.
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The Politics of Creativity™: Four Domains for Inquiry and Action by Leaders in R&D1 Steve Boehlke Leaders in R&D functions today face increasingly challenging environments in which to foster creativity and promote innovation. While organizational systems and management processes impact productivity, relationships between and among scientists and engineers must be nurtured to sustain competitive advantage. Initiating conversations about organizational dynamics that are otherwise difficult for R&D professionals is a critical task of leaders. This paper, based on practitioner work in the field, identifies four domains of inquiry and action in which focused dialogue and leadership initiative promises more engaged and motivated professionals: (1) pacing productivity; (2) capitalizing on failure; (3) managing connections; and (4) paying the price. As a result of working intentionally in these domains, leaders in R&D make it possible for their organizations to work explicitly with the ‘Politics of Creativity™’ in a way that encourages trust and fosters more creativity.
Introduction and Overview
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elationships, more than technology, management processes or organizational architecture, define and differentiate competitors today. The task of nurturing relationships that support innovation requires a responsible use of power and a powerful use of passion. The passion to create is easily stifled when trust is lacking. Fear of addressing key issues which impact an organization’s creative energy often prevails when power and control dominate the work environment. Such fear is an indicator of lack of trust. The goal of this paper is to equip leaders to identify and release unspoken inhibitors to creativity in R&D organizations. As a result, the organization can better leverage its technical talent in the service of innovation with a greater competitive edge in the market. The political dimensions of creativity are real and omnipresent, though seldom explicitly addressed. Webster’s dictionary defines ‘political’ as ‘competition between competing interest groups or individuals for power and leadership’. When people must deal with groups of other people, especially in large
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‘Politics of Creativity™’ and ‘Under the Radar™’ are trademarks of SFB Associates Inc.
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organizations, politics is inevitable. Recurring denial by leaders that their organizations are ‘political’ only reinforces the proposition that power and control are being exercised in a manner that compromises organizational effectiveness. Indeed, previous research has established that leaders must re-frame ‘novel, unfamiliar, and even threatening stimuli so that innovation can happen’ (Frost, 1994). Such re-framing ‘will often be political. . . . Innovation takes place in the midst of politics, language, trust, and time among other things’ (Frost, 1994). And creativity is the primary impulse that spawns innovation. Through a series of workshops over five years, as well as being a practitioner with large corporate R&D functions across industry, we have identified four domains of inquiry and action where the political behaviour of leaders and creative passion converge.
Working ‘Under the Radar™’ More than 200 leaders of scientists and engineers primarily from US-based Fortune 100 global companies have participated in 13 ‘Under the Radar™’ Workshops we have convened1. These workshops, each hosted by a different company, are designed to facilitate
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• • • •
Pacing productivity: recognizing performance motivators and stressors Capitalizing on failure: fostering a more trusting learning environment Managing connections: leveraging connections as well as relationships Paying the price: acknowledging the risks and rewards of being different
Figure 1. Four Domains of Inquiry and Action
inquiry and foster collaboration across industry about critical challenges facing leaders who work with scientists and engineers today. The identification of the workshops as ‘Under the Radar™’ refers to our awareness that crucial issues related to leadership effectiveness lie just beneath the surface of many conversations and interactions in the organization. Participants in these workshops were primarily directors or senior technical leaders from diverse industries, typically with at least 20 years’ experience in R&D functions. The ratio of male to female participants was approximately 3:1. Participation in the ‘Under the Radar™’ Workshops was by invitation with the understanding that there would not be competing organizations from the same industry present. The goal of the workshops was to provide a one-and-a-half day ‘learning community’ where peers in R&D could discuss difficult and often challenging issues relating to leadership specifically in the technical community. Each workshop included approximately 25 participants. Observation of smallgroup break-out discussions as well as ongoing work with clients in R&D provided empirical data for this paper. By documenting and reviewing recurring themes uncovered in these workshops, we have identified four domains where the political behaviour of leaders can either encourage greater creativity or hinder it (see Figure 1). These domains are: (1) pacing productivity; (2) capitalizing on failure; (3) managing connections; and (4) paying the price. We believe it is critical for managers to have open, sometimes difficult, dialogue with engineers and scientists to explore together organizational patterns in these areas to ensure that those patterns are aiding creativity and innovation rather than hindering it.
Breaking the Rules The political nature of organizations becomes more apparent to individuals when they are confronted with the question, ‘How does one
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learn which rules are okay to break?’ This is not an invitation to compromise ethical standards or perpetuate dishonest business practices. Rather, it is an acknowledgment that everyone learns in some way or other which boundaries are permissible to cross. In a study of ‘rule-breaking’ in new product development, five out of seven cases cited either broke or bent rules (Olin & Wickenberg, 2001). Research has shown new product development to have several peculiarities. Among these, it is a process characterized by organizational politics. . . . Abundant anecdotes tell us of defective rule design. Some anecdotes address how deviant rule-following in fact is what keeps business running (Olin & Wickenberg, 2001). The authors of this study continue: ‘Perhaps project managers tend to regard such organizational politics as bureaucratic resistance’ (Olin & Wickenberg, 2001). Resistance or not, ‘breaking the rules’ is a generally accepted ‘norm’ of the creative process. Without some capacity for acknowledging and exploring these boundaries of openness – where one can step outside or beyond generally accepted norms – the passion for innovation and new ways of working is stifled. Juxtaposed with the necessary exercise of power and control is the creative instinct to go where no one has gone before. The discipline of management must be balanced with the vision and openness of leadership (Herbold, 2002). Political behaviour in the service of creativity necessarily includes ‘rule-breaking’. This is a difficult but important conversation to facilitate. ‘Champions (in innovation) are essentially political actors who are not prepared to abide by organizational rules’ (Olin & Wickenberg, 2001).
Difficult Conversations Limiting beliefs about how one achieves success in an organization or how one leads a diverse group of talented people are governed by ‘rules’ of which we are not even conscious much of the time. The management of ‘tacit interactions’ is increasingly essential for competitive advantage. Tacit interactions reduce the importance of structure and elevate the importance of people and collaboration. . . . Tacit work is improvisational and difficult to define in advance, for it follows the problem being solved and the nature of the opportunity at hand (Beardsley, Johnson & Manyika, 2006). © 2008 The Author Journal compilation © 2008 Blackwell Publishing
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New pathways for innovation are established when aspects of what is tacit can be made explicit without undue fear or recriminating consequences. Creative energy is released not only at the lab bench but also among managers when leaders, both technical and managerial, demonstrate how scientists and engineers can deepen their relationships through more rigorous dialogue. Pursuit of common missions or goals more easily follows. We will describe each of the four domains of action which require intentional leadership for dialogue and new behaviour to occur within the organization. A review of selected research on creativity and leadership is integrated into the discussion. Examples gleaned from our ‘Under the Radar™’ Workshops further anchor our work to illustrate creative and productive outcomes. We also offer suggestions for further inquiry and study.
‘Political’ Behaviour in R&D To ground our discussion of the ‘Politics of Creativity™’ we cite several behavioural examples from our work which threaten the integrity of the creative process and the quest for innovative productivity. It is political behaviour because it seeks to exercise influence and control between competing factions. ‘Ours is a success driven culture. You can work on anything you want as long as you report it correctly.’ This statement by a senior scientist in a large R&D organization is but one example of how one learns what behaviour is ‘politically correct’. There is no intent to be deceitful or dishonest; there is awareness, however, of the need to push the boundaries while at the same time accounting properly for time and resources. ‘He is a brilliant scientist; he’s just going to have to learn how to work with this guy.’ This comment as part of a performance feedback conversation excuses poor leadership practices by justifying intellectual brilliance. Learning to ‘play the game’ according to rules that bend for the more distinguished talent compromises organizational effectiveness and demotivates rising talent. Failing to report ‘stranded resources’ when project plans take an unexpected turn could be viewed as prudent planning for the next round of research in one’s division. Or it can be understood as failing to lead with integrity when trying to manage severely constrained corporate resources against an annual profit plan. Whatever the course of action chosen, the ‘boundaries of openness’ are tested when such implicit behaviour is noticed but not discussed. © 2008 The Author Journal compilation © 2008 Blackwell Publishing
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The exercise of power and control as exemplified in the above examples need not be implicit or covert. Often the required political leadership is much more overt. ‘Acquiring the resources for the successful innovation of new products demands political skills’ (Jones & Stevens, 1999). We will address ‘political skills’ related especially to four domains of inquiry and action previously identified. Before proceeding, however, Jones and Stevens helpfully acknowledge the challenge of appropriate methodology: Quantitative research methodologies are simply too crude to capture the way in which ‘sectional interests’ influence organizational activities . . . Methods based on the re-interpretation of existing case studies, questionnaire surveys or even interviews are unlikely to reveal the full range of political activity that occurs in organizations. . . . Those studying innovation oversimplify the complexity of organizational behaviour (Jones & Stevens, 1999). We do not want to oversimplify. We do want to focus attention on how leaders can touch the creative impulse of technical professionals by surfacing otherwise difficult matters for discussion and action. Managers are necessarily required to exercise power and control to execute their responsibilities effectively. This requires astute political skills. The capacity of managers to navigate challenging issues at the intersection of power and passion differentiates them as leaders. Leaders, aware of political realities which are often not acknowledged, generate trust which motivates and inspires. This, in turn, encourages creativity.
Four Domains for Inquiry and Action Our purpose, then, is to encourage leaders to surface underlying assumptions and fears related to each of the four domains discussed below and to take appropriate action. These matters which impact creativity are not easily discussed. Each of the domains includes examples gleaned from our work as well as reference to research literature. The domains are inter-related; each domain can serve as a lens through which to inquire and understand the political issues in the other three domains. For example, the first domain might be further studied in terms of the ‘price’ which is paid by technical professionals as well as the organization-at-large for the way the pace of productivity is managed at different stages of the R&D pipeline (‘Paying the Price’ being the
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fourth domain discussed below). Attention to these domains need not be linear; priority should be given to those which resonate most powerfully with technical professionals in the organization.
Pacing Productivity Being competitive in today’s market environment depends more than ever on innovation. At the same time the pressure by financial analysts to perform is relentless. Business drivers dictate reduced cycle time and lean Six Sigma processes from top to bottom. The very pressure to innovate can stifle creativity. 3M, for example, traditionally known as a creative company, succumbed to a leaner, more efficient management style under the leadership of former CEO, James McNerney. Under McNerney, the R&D function at 3M was systematized in ways that were unheard of and downright heretical in St. Paul, even though the guidelines would have looked familiar at many other conglomerates (Hindo, 2007). Six Sigma Lean Six Sigma programs, similar to those McNerney imported to 3M from GE, gained popularity after Jack Welch’s extensive use of the process at GE (Welch & Welch, 2005). Black-belt professionals streamline processes and reduce cycle time to increase efficiency and eliminate waste. Many R&D functions are trying to follow suit, adopting such protocols in the lab. The results are mixed, at best, for organizations-at-large as well as R&D. For example, of 58 large companies that have implemented Six Sigma programs, 91 per cent have trailed the S&P 500 since doing so (Morris, 2006). Attention to driving down defects, a primary focus of Six Sigma, is not conducive to creativity. Business processes which address cost-reduction and increased efficiency do not necessarily generate new value. Eliminating redundancies by evaluating and improving processes can indeed add value. But they also bring additional stress to the R&D environment. The politically astute leader understands how difficult it is for professionals to raise questions about or argue with process requirements. As one R&D project leader in our client group stated, ‘It is a fine line between telling the truth and keeping a project alive’ with reference to the pressure he experiences in trying to follow process requirements. This does not mean that creativity cannot be tapped under duress. Sitting in the Apollo
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Mission Control Room at NASA’s Johnson Space Center in Houston, Texas, at one of our recent ‘Under the Radar™’ Workshops, we were all reminded of the rescue of the Apollo 13 crew from space in 1970. The ad hoc response of the mission control team exemplified creativity and innovation with severely constrained resources under extraordinary pressure. However, this is the exception not the rule. People cannot maintain such creative output under sustained stress and extended demands for productivity over long periods of time. The seminal work of Teresa Amabile substantiates this. You may use pressure as a management technique, believing that it will spur people on to great leaps of insight. . . . If so, are you right? Based on our research, the short answer is ‘no’. When creativity is under the gun, it usually ends up getting killed (Amabile, Hadley & Kramer, 2002). Collecting more than 9,000 diary entries from 177 employees in seven US companies, Amabile’s study confirmed that time pressure results in professionals being less creative not only on one particular day where time pressure is experienced but in subsequent days as well (Amabile, Hadley & Kramer, 2002). The importance of variability in pacing is evident not only in the creative process but is also essential in keeping professionals engaged and motivated. A team leader having morale problems with his project team explained with pride that a year or two earlier they had been assigned a difficult project with insufficient time and money. Nevertheless, they were motivated by the challenge and stepped up to succeed in the stressful effort. Subsequent assignments that were short on resources followed and thus were also stressful. The team leader could not understand why team morale was suffering in the current effort since the challenge had motivated them in the first one. There is a tipping point where the demand to deliver new ideas and create new products is counterproductive. The fact that it may be difficult to determine just where this threshold lies does not negate its substantial impact on people whose passion and energy is extinguished by it. In our work with R&D leaders the desire to accelerate innovation by streamlining work processes can paradoxically have just the opposite impact, most especially at the ‘front end’ of the R&D pipeline. One must consider at what stage of the R&D pipeline efficiencies for the sake of greater productivity are advocated. When process improvement measures © 2008 The Author Journal compilation © 2008 Blackwell Publishing
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are implemented, whether Six Sigma or otherwise, leaders in R&D must exercise caution so that uniformity of processes does not supplant the necessary time and space for creative inquiry and unanticipated discovery to occur. With one client the inventory of leads at the front end of research was drying up, according to many of the professionals engaged with that stage of breakthrough discovery, due to management’s efforts to capture cost savings by standardizing processes and procedures. The resulting mechanisms were actually experienced as very cumbersome and timeconsuming, squeezing the very creative life out of the organization’s most valued talent. Not until explicit inquiry was made about the intent of the process ‘efficiencies’ versus the impact they were actually having at the ‘front end’ was a productive yet creative balance recovered. Pacing productivity requires a conversation, about variability as well as velocity (the speed at which we work) and synchronicity (the timing of collaboration and hand-offs). The political aspect of pacing productivity emerges when management’s best intentions fail to provide opportunity for inquiry and response to these variables. Managing Uncertainty The drive to minimize uncertainty in work processes and experimental methodology readily follows when stringent focus is placed upon reducing defects and eliminating waste. Learning to manage uncertainty effectively is critical. This is as true for the business enterprise-at-large as much as the R&D function in particular. Most companies have a strong action bias, so they are uncomfortable with the slow, simmering process necessary to wrestle with future uncertainty. . . . They are focused more on performance than on learning (Schoemaker, 2002). Appropriate pacing has everything to do with encouraging inquiry in a timely and appropriate way, depending on the stage of the development cycle. ‘Political’ behaviour readily emerges when management is perceived as shutting down technical discussion prematurely at the ‘fuzzy front end’ of innovation. Conversely, as a project approaches commercialization, management’s exercise of the necessary controls with regard to continuing pursuit of often compelling and newly emerging options may be experienced as political (i.e., controlling in an arbitrary way). Managing uncertainty requires learning to ask the right questions at the right time. This is © 2008 The Author Journal compilation © 2008 Blackwell Publishing
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less a function of requiring more data and more about reflection and judgement based on intuition. Wanting more information and additional data can inhibit ‘early failure’ and timely decision making or encourage it. We combat our uncertainty either by acting hastily on the basis of minimal information or by gathering excessive information which inhibits action and may even increase uncertainty. Which of these patterns we follow depends on time pressure or the lack of it (Dörner, 1996). The savvy political leader knows when and how to encourage further inquiry and when to reign in the questions. Knowing when sufficient, though not necessarily complete, information is enough requires learning the value of the 80/20 per cent solution. ‘The more we know the more clearly we realize what we don’t know. This probably explains why we find so few scientists and scholars among politicians’ (Dörner, 1996). Astute leaders recognize and reward those who exercise early judgement in the face of uncertainty. They do not tolerate failure to ask the critical questions as early as possible. The amount of time preparing technical presentations for review is a prominent indicator in most organizations of how uncertainty is managed, or not. The preparation for and management of meetings is very much a matter of politics – the exercise of power and control before, during and after. In one client organization this was but a symptom of an organizational norm regarding adequate data sets and sufficient information. Enormous amounts of the organization’s collective effort were devoted to preparing for meetings and sitting through lengthy reviews. By applying the Pareto Principle to the organization’s ‘meeting culture’ (Koch, 2003) and doing a simple root cause analysis, it became apparent that time management issues (pushing harder and harder for more in less time) were but a symptom of much deeper systemic issues. This provoked new conversation in unfamiliar terrain. The need to always have ‘the answer’, and fear of punishment for failure to do so, surfaced as beliefs prevalent throughout the organization. These beliefs contributed to what the client referred to as a ‘meeting culture’ dominated by over-prepared, timeconsuming technical presentations with virtual ‘stacks’ of back-up slides. Applying the 80/20 per cent solution to the preparation of technical presentations uncovered new understanding of the root causes of all too frequent tedious meetings which inevitably ran over time.
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We cannot accelerate innovation by increasing the demand for flawless execution or striving to eliminate uncertainty. Without honest and open inquiry into this domain of action, political behaviour, which drives harder and harder for more and more, easily remains ‘unchecked’. Pacing productivity requires conversation about the dynamics of the generative process of humans at work. We are not machines.
Capitalizing on Failure ‘For a generation of managers weaned on the rigors of Six Sigma error-elimination programs, embracing failure – gasp! – is close to blasphemy’ (McGregor, 2006). While ‘failure’ is inherent to the scientific method in the testing of hypotheses, the capacity to learn from failure in most organizations is severely underdeveloped. ‘Every company in the world says, “It’s O.K. to fail.” And for 99% of them it’s probably not true’, comments Douglas Merrill, Vice President of Engineering and Chief Information Officer at Google, Inc. (Wall Street Journal, 2007). Fear of failure and the accompanying organizational defences result from political behaviour which seeks to exercise control but fails to maximize learning. Converting failure to learning requires an environment of trust and non-defensive behaviour. The creative spirit flourishes when leadership promotes such an environment rather than a ‘designed mediocrity’, referring to the unspoken often hidden assumptions which leaders fail to uncover (Argyris, 1990). Social Systems and Defensive Routines Understanding the value of failure analysis to stimulate organizational creativity and innovative productivity requires a spirit of openness and inquiry and leaders with skills to foster these. Social systems tend to discourage this kind of analysis (Cannon & Edmondson, 2005). This is particularly true in working with brilliant scientists and others with sharplyhoned intellectual skills (Argyris, 1991). The very use of the word ‘failure’ can provoke strong emotional reaction. Seldom in the midst of experiencing disappointing results or substantial deviation from anticipated outcomes is a person capable of identifying the experience as ‘intelligent failure’. In some organizations leaders defer to language such as ‘completing the learning’ or ‘successful project review’. But they do not talk about failure. This has costly consequences. Experience at our ‘Under the Radar™’ Workshops confirms that leaders seldom share their
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own stories of failure; they have no ‘safe’ environment to practise doing so. Yet there is little that can have as much impact in eliminating fear in an organization and encouraging more open inquiry as the sharing of personal stories. Defensive routines, both individual and organizational, are powerful behaviours which leaders often ignore because they do not know how to deal with them. In contrast, the tasks of leading the project team or managing the business are more familiar because there are more concrete, clearly defined management processes to prescribe the way. Argyris defines ‘defensive routines’ as ‘all the policies, practices, and actions that prevent human beings from having to experience embarrassment or threat, and, at the same time, prevent them from examining the nature and causes of that embarrassment or threat’ (Argyris, 1994). Consequences of Defensive Routines A study analysing the outcomes of 14 strategic failures in a very large European telecommunications company draws some supportive conclusions about the consequences of defensive routines (Baumard & Starbuck, 2005). Among other things, the study concluded that managers tend to ignore small failures that challenge the organization’s core beliefs. The core beliefs in turn gave small failures consistent patterns over time. . . . Manoeuvres for political advantage often took precedence over the substantive strategic issues, and managers used their vows of allegiance to core beliefs to justify failures in which they participated (Baumard & Starbuck, 2005). More rigorous conversation about failure and the defensive routines which bury it is essential. At least three factors discourage the discussion of failure in social systems, as documented in the research of Cannon and Edmondson: (1) individuals experience negative emotions when examining their own failures; this chips away at self-confidence and self-esteem; (2) most managers are rewarded for decisiveness, efficiency and action rather than reflection and painstaking analysis; (3) psychological biases and errors reduce human perception, sense making, estimation and attribution (Cannon & Edmondson, 2005). Tools such as ‘After Action Reviews’, originally implemented by the US Army, and ‘Emergent Learning Maps’ can encourage constructive organizational dialogue about failure. But the utilization of such tools as part of project reviews and evaluation does not guarantee that organizational learning is occurring. © 2008 The Author Journal compilation © 2008 Blackwell Publishing
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In designing a ‘Capitalizing on Failure’ workshop for an R&D client, we agreed on the need to identify some ‘case studies’ for the workshop. Initially the client requested that we provide relevant external case studies. While recognizing the potential value of doing so (the Baumard and Starbuck study cited above being one such relevant study), we inquired further about internal documentation that might serve as case study material. We subsequently learned that ‘After Action Reviews’ were used in the lab. However, for reasons described as related to the security and protection of intellectual property, these reviews were not available to the managers enrolled in the ‘Capitalizing on Failure’ workshop. One outcome of the workshop was new awareness of how learning about failure was thwarted because of organizational norms. In the end, two very significant internal case studies were presented by leaders in the organization, using ‘After Action Reviews’ that had not previously been available to management in any clearly accessible way. The learning was immediate and the new behaviour selfevident. Failure to include conversations about ‘failure’ as part of the discourse of management is a second manifestation of the ‘Politics of Creativity™’ at work. In addition to surfacing and exploring underlying assumptions about the pacing of productivity, leaders must practise uncovering organizational defensive routines. Failure to do so perpetuates an environment of fear and risk aversion, reinforcing patterns of behaviour antithetical to creativity and discovery. Creativity flourishes only where trust is sure.
Managing Connections Identifying new relationships and discovering new patterns is core to the creative process. Who would imagine that spam-blocking technology might have an application in HIV research? (Baker & Greene, 2007). Assessing the impact of one’s networks on creative energy requires differentiation between connection and relationship. Relentless connectivity actually diminishes the time and space we have to identify and reflect upon unique, valued relationships – whether ideas, people, products or nations. Limiting connections may be as critical to achieving breakthrough as expanding one’s network. Over-Connected and Under-Related ‘The World is Flat’ is a popular point of view these days (Friedman, 2005). It depicts a global © 2008 The Author Journal compilation © 2008 Blackwell Publishing
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community that has increasing access to and dependence on one another, economically and otherwise. Social networks such as MySpace have emerged as among the most powerful (and valuable) on-line phenomena in recent years (Kirkpatrick, 2006). In the world of R&D, the possibility of peer discussion and review of a scientific discovery occurs within hours of a posting on-line, long before journal publication permits the exchange of technical information. However, such burgeoning connections do not necessarily enable new relationships or innovation. Emerging evidence suggests that despite the seemingly endless opportunities to connect, people are feeling more disconnected than ever. Recent research published by the American Sociological Association cites evidence that ‘discussion networks are smaller in 2004 than in 1985. . . . The number of people who say there is no one with whom they discuss important matters has nearly tripled’ (McPherson, Smith-Lovin & Brashears, 2006). Connections and relationships are not the same. Connections may look like relationships and some people will even act as though they are the same. Connections are characterized by an exchange of value; relationships generate sustainable mutual value. Trusting relationships reinforce learning and foster creativity. Research on the power of social networks substantiates statistically the value of generating trust in relationships. A study done in three global companies in different countries found that two types of trust play an important role in how people transfer knowledge: competence-based trust and benevolencebased trust (Cross & Parker, 2004). The latter, in particular, is contingent on personal ‘relationships’ not just connections which transmit information. ‘When people have this kind of trust they are more forthright about their true expertise and much more likely to be creative, learning what they need so they can do something better or differently’ (Cross & Parker, 2004). Small-World Value A recent study by researchers at the University of Pennsylvania suggests that the ability of groups to solve difficult computational problems is actually greater when they are structured as a ‘small-world’ network than in more expansive, information-rich, arrangements (Kearns, Suri & Montfort, 2006). Access to global information actually seemed to hamper the performance of subjects. With further study, such findings may have implications for areas such as information
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sharing across large organizations and the design of user interfaces for complex systems for multiparty coordination (Kearns, Suri & Montfort, 2006). More connections in expanded networks do not necessarily increase value. A client in a Fortune 100 R&D organization spoke of the challenges of ‘Open Innovation’ by contrasting relationships in a neighbourhood with those of a cocktail party. In the former the relationships evolve from a shared sense of purpose, involve trust, and are intended to serve in numerous ways an uncertain future. In the latter the relationships are opportunistic, based on common immediate circumstance; while they may be energetic and exciting they infrequently lead to relationships of value in the long term. The client’s experience speaks to the need for new models for network relationships which attend to limiting connections rather than constantly expanding them. An example of confusing the nature of connections with relationships was evident in a client organization with which we worked. Wanting to engage more professionals in imagining the future state of the organization, senior leaders created an internal ‘wiki’ for top-tier R&D professionals where they posted a white paper describing an envisioned future state of the industry. When a meeting was convened to discuss the white paper, only three to four individuals out of a population of some 100 had entered a comment on the wiki. Senior leadership was perplexed and disappointed. In unplanned break-out discussions at the outset of the meeting to discuss the lack of ‘dialogue’ on the wiki, the primary factors identified by participants for the breakdown in communication were lack of context or direction about what was expected as well as lack of trust about how the comments would be used. ‘Small world values’ – that of a community of mutual relationship – were missing in the virtual environment. Proliferating networks, while expanding connections, do not necessarily foster valuable relationships. The creative impulse is compromised if not completely lost when managing connections dominates one’s priorities. The constant thumbing of Blackberries and other mobile devices by leaders in and of themselves reinforce perceptions of constant vigilance and necessary control on the part of management, whether intentional or not. This is actually a kind of ‘political’ behaviour though few would initially identify it as such. This warrants a further cost/benefit analysis when it comes to creativity and innovative productivity.
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There is a ‘tipping point’, where not only information but connection overload as well, can kill creativity and the passion that fuels it. ‘I just need time to think’ is a recurring refrain among many of our clients in search of more opportunity for creative exploration and reflection. Pulling the plug on connections for a period of time and focusing on a few key relationships may generate more value than ever-expanding networks that are always ‘on’.
Paying the Price ‘Nothing is created without something being destroyed’, asserts Patricia Woertz, CEO of Archer Daniels Midland (Birger, 2006). Her remarks mirror those of Pablo Picasso: ‘Every act of creativity is first an act of destruction’. Underscoring the ‘wrenching personnel decisions’ related to the re-organization of Chevron Oil’s Downstream Company, where Woertz previously served as a senior executive, she continues, ‘It underscores the shadow side of creativity’. Alert and responsible leaders understand that they can cast big shadows. Without explicit and timely acknowledgment of the consequences of the choices they make, including the decision to pursue new, creative, unprecedented technical solutions, ROI can be compromised despite the best of intentions. Something has to be released or let go or even destroyed in order to change. This is difficult for many leaders to acknowledge to themselves never mind their constituency. Creativity and Leadership The exercise of creativity and the practice of leadership converge in terms of both bearing a cost. This is not a reference to capital investments or salary and benefits but rather the personal and social consequences of deviating from established norms. For all the literature devoted to leadership theory and practice, very little has addressed the cost of leadership. Literature searches uncover numerous references to ‘sacrificial’ leadership, primarily in the context of religious discourse. Very little research has been done on leaders ‘paying the price’ in terms of personal risk as well as professional consequences. This reality is illustrated by the experience of a senior scientist in one of our client organizations who was sequestered away for over a year to work with a highly selective and very talented technical team on a promising breakthrough project. While the merits of the technical work remain a matter of debate, the ‘political’ consequences were immediate and continuing. His failure during that period of © 2008 The Author Journal compilation © 2008 Blackwell Publishing
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time to confer with others in the organization who had a vested interest in managing what was happening resulted in his being marginalized within the organization even several years later. Differing perspectives undoubtedly exist within the organization on the facts of the matter; however, failure to acknowledge the ‘political’ dimensions of technical professionals making such choices undermines creativity and stifles passion. This fourth domain of inquiry and action for leaders in R&D addresses the potential losses incurred by individuals who dare to be different. The choreographer and dancer, Twyla Tharp, writes, ‘To lead a creative life you have to sacrifice. “Sacrifice” and “Having it all” do not go together’ (Tharp, 2003). Little quantitative research has been done on this topic. Yet it is acknowledged and referenced repeatedly in the lives and literature of creative personalities.
The ‘Faustian Bargain’ The biographical studies of Howard Gardner on the creative power of seven historical leaders in their respective fields at the turn of the century resulted in several unanticipated themes emerging (Gardner, 1993). He refers to one of these as ‘the Faustian bargain’. The reference is to the legend of Faust in which the gift of special power is tied to a kind of ‘bargain’ to sustain the power or gift. His conclusion: ‘Usually, as a means of being able to continue work, the creator sacrificed normal relationships in the personal realm. . . . It’s as if each creator had, so to speak, struck a deal with a personal god’ (Gardner, 1993). One should not conclude from this that relationships are not important to the creative process, for another of the unanticipated outcomes of this study is that, at the time of creative breakthrough, most leaders had at least one ‘confidant’ relationship that was especially significant at that time. This path of inquiry takes one quickly into the realm of myth and meaning-making, how one ‘makes sense’ of one’s internal experience as well as calibrates one’s value to the external world. This is fertile ground for further inquiry though not terrain that is easily traversed by scientists and engineers. The most evident indicator of these concerns being prominent in the management of R&D is at the point at which technology professionals are promoted to a supervisory or management position for the first time. The required differentiation from their scientific peers, upon whom they have relied personally as well as professionally, is experienced as separation if not isolation. Some are unable to © 2008 The Author Journal compilation © 2008 Blackwell Publishing
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assume the necessary ‘distance’ to manage former peers effectively. The cost of losing those peer relationships is not worth the expanded responsibilities and accompanying authority that comes with ascending the management ladder. The politics at play in organizations can make it very difficult to articulate and explore the trade-offs involved if one risks deviating from established norms. This relates to the question posed at the outset of this paper, ‘How does one learn which rules are okay to break?’ Deviation is inevitably required in the exercise of creativity as well as the practice of leadership. Seeking permission to depart from organizational norms and procedures is not leadership. Acknowledging that it is required for breakthrough to happen, however, is essential. To work creatively in pursuit of new discoveries requires courage as well as the discipline to stand apart, to be different. The distinguished existential psychologist, Rollo May (1976) writes: Creative people as I see them are distinguished by the fact that they live with anxiety, even though a high price is paid in terms of insecurity, sensitivity, and the defenselessness for the gift of ‘Divine Madness’ to borrow the term used by the Classical Greeks. Whether or not one links the passion to create to the ‘divine madness’ of the Greeks, leaders learn to acknowledge and then manage the anxiety of being different while striving to remain connected to those for whom they are responsible. This capacity to differentiate but still be connected is essential to the creative process as well if one wants to generate products of value. Political astuteness in this domain requires self-awareness above all.
Conclusion The creative practice of leadership and the exercise of creativity both require uncovering the covert political dimensions of organizational behaviour. We have illustrated how this dynamic manifests itself in a variety of different contexts in R&D functions today. The question is not whether organizations will have politics, but what kind of politics they will have. Politics can be and often is sordid and destructive. But politics can also be the vehicle for achieving noble purposes, and managers can be benevolent politicians (Bolman & Deal, 1991).
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Our goal has been to identify four specific domains of inquiry and action which warrant attention in order to optimize creativity by addressing issues which lie just beneath the surface, under the radar, of many R&D organizations. Our experience in working with our clients as well as our ‘Under the Radar™’ Workshops confirms that the very process of identifying ‘undiscussables’ initiates change and prompts action. This does not come naturally to most leaders. Without explicit attention to the four domains identified in our work, energy is drained and resources unnecessarily depleted. We have corroborated our experience with a search of the literature in the field that validates specific concerns at the intersection of power and passion in each of the four domains. Any one of the four domains – pacing productivity, capitalizing on failure, managing connections, or paying the price – can be used as a lens through which to understand and practise interventions in the other three domains. For example, by focusing the inquiry on ‘paying the price’, one might ask, ‘what risks are we willing to take to maximize the benefits of our connections as well as relationships, internal and external?’ Or by choosing ‘managing connections’ as the lens, one could ask, ‘How do our external connections or lack thereof impact the pacing of our productivity?’ The starting point for this work is our belief that the quality of relationships establishes an organization’s competitive advantage today. As we stated at the outset, the task of nurturing relationships that support innovation requires a responsible use of power and a powerful use of passion. The passion to create is easily stifled when trust is lacking. Leadership at the intersection of power and passion requires establishing trust in domains we are unaccustomed and often inexperienced in addressing. Leaders in R&D can and do make a difference when the ‘Politics of Creativity™’ are acknowledged and addressed.
Acknowledgements This article is based on a paper presented by the author at the International R&D Management Conference in Taiwan, November 2006, sponsored by the R&D Management Journal as well as this journal. Since then clients as well as professional colleagues have contributed to the continuing discussion of this topic. The author especially thanks Jack Johnston, Deary Duffie and Andrew Kaldor for their insights and suggestions.
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References Amabile, T., Hadley, C. and Kramer, S. (2002) Creativity under the Gun. Harvard Business Review, 80, 52–61. Argyris, C. (1990) Overcoming Organizational Defenses. Allyn and Bacon, Needham Heights, MA. Argyris, C. (1991) Teaching Smart People How to Learn. Harvard Business Review, 69, 99–109. Argyris, C. (1994) Good Communication That Block Learning. Harvard Business Review, 72, 77–85. Baker, S. and Greene, J. (2007) Using Spam Blockers to Target HIV, Too. Business Week, 1 October. Baumard, P. and Starbuck, W.H. (2005) Learning from Failures: Why It May Not Happen. Long Range Planning Journal, 38, 281–98. Beardsley, S.C., Johnson, B.C. and Manyika, J.M. (2006) Competitive Advantage from Better Interactions. The McKinsey Quarterly, 2, 53–63. Birger, J. (2006) Patricia Woertz, the Outsider. Fortune Magazine, 2 October. Bolman, L.G. and Deal, T.E. (1991) Reframing Organizations, Artistry, Choice, and Leadership. Jossey Bass, San Francisco, CA. Cannon, M.D. and Edmondson, A.C. (2005) Failing to Learn and Learning to Fail (Intelligently): How Great Organizations Put Failure to Work to Innovate and Improve. Long Range Planning Journal, 38, 299–319. Cross, R. and Parker, A. (2004) The Hidden Power of Social Networks. Harvard Business School Press, Boston, MA. Dörner, D. (1996) The Logic of Failure. Metropolitan Books, New York. Friedman, R. (2005) The World Is Flat. Farrar, Strauss and Giroux, New York. Frost, P. (1994) Leading with Innovation in Mind. Creativity and Innovation Management Journal, 3, 79–84. Gardner, H. (1993) Creating Minds, an Anatomy of Creativity Seen Through the Lives of Freud, Einstein, Picasso, Stravinsky, Eliot, Graham, and Gandhi. Basic Books, New York. Herbold, R.J. (2002) Inside Microsoft: Balancing Creativity and Discipline. Harvard Business Review, 80. Hindo, B. (2007) At 3M, a Struggle Between Efficiency and Creativity. Business Week, 11 June. Jones, O. and Stevens, G. (1999) Evaluating Failure in the Innovation Process: The Micropolitics of New Product Development. R&D Management Journal, 29, 167–78. Kearns, M., Suri, S. and Montfort, N. (2006) An Experimental Study of the Color Problem on Human Subject Networks. Science, 313, 824–27. Kirkpatrick, D. (2006) Life in a Connected World. Fortune, 10 July, 98–106. Koch, R. (2003) The 80/20 Individual. Random House, New York. McGregor, J. (2006) How Failure Breeds Success. Business Week, 10 July 10, 42–52. McPherson, M., Smith-Lovin, L. and Brashears, M.E. (2006) Social Isolation in America: Changes in Core Discussion Networks Over Two Decades. American Sociological Review, 71, 353–75.
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May, R. (1976) The Courage to Create. Bantam Books, New York. Morris, B. (2006) The New Rules. Fortune, 24 July, 80–81. Olin, T. and Wickenberg, J. (2001) Rule Breaking in New Product Development – Crime or Necessity? Creativity and Innovation Management, 10, 15–25. Schoemaker, P.J.H. (2002) Profiting from Uncertainty. The Free Press, New York. Tharp, T. (2003) The Creative Habit. Simon and Schuster, New York. Wall Street Journal (2007) Managing Innovation, How to Get the Most Out of Your Company’s Big Ideas. 24 September. Welch, J. and Welch, S. (2005) Winning. HarperCollins, New York.
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Steve Boehlke (
[email protected]) is a practitioner with some 20 years’ experience supporting global corporations in developing more effective leaders. He is founder and president of SFB Associates, Inc., a consulting firm based in Minneapolis, MN, which focuses on leadership collaboration and development, especially with R&D organizations as well as technical professionals. His research on politics and creativity continues in the context of his consulting work.
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Book Reviews Puccio, Gerard J., Murdock, Mary C. and Mance, Marie (2007) Creative Leadership, Skills That Drive Change, Sage Publications, London. 307 pp, Paperback: ISBN-10: 1-4129-1380-2.
Puccio, Murdock and Mance have written a book on creative leadership that is rooted in, and builds upon a long and impressive tradition in creativity, and more specifically in creative problem solving, at the International Center for Studies in Creativity at Buffalo State College. This tradition, which started with the work of Osborn, is characterized by the conviction that creativity is more than a personal trait. Creativity may be stimulated by developing the right skills, by working through an effective process, and by creating an environment that is conducive to creative thought. In this book, the authors focus on the relationship between creativity and leadership, which forms a basis for change. In the first part of the book (chapters 1–4), a lot of models and results of previous research are presented, to support the authors’ proposition that creativity is at the core of leadership and that leadership effectiveness can be enhanced by creative problem-solving skills. Also in the first part, the main concepts are defined and specified. Leadership, for instance, is defined as ‘the process of positively influencing people, contexts, and outcomes through a deliberate creative approach that is applied to open-ended, novel, and ambiguous problems, both opportunities and predicaments’. Important also is the distinction made between creativity and innovation. Creativity stands for the production of original ideas that serve some purposes, thus combining novelty and usefulness. Innovation is more than making a creative product, but includes also its successful commercialization. In chapter 2, ‘the main course on the menu’ is introduced: the so-called ‘Thinking Skills Model’, which is a graphic model depicting the process of creative problem solving. The main elements of the model are: • Three basic stages of problem solving: clarification (what needs to be resolved), transformation (identify potential ideas and craft them into workable solutions) and implementation (refine the solutions and put together a plan for taking effective action).
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• Each basic stage contains one ‘exploring’ and one ‘formulation’ step, in order to enhance people’s effectiveness in problem solving. This results in six formal steps of creative problem solving. 䊊 ‘Clarification’: exploring the vision and formulating challenges. 䊊 ‘Transformation’: exploring ideas and formulating solutions. 䊊 ‘Implementation’: exploring acceptance and formulating a plan. • A seventh, executive step, assessing the situation, which helps people to stand above the previous six steps. This step requires metacognitive thought, i.e., the ability to monitor and control your own cognitive processes. • All processes require a dynamic balance between divergent thinking (a broad search for many diverse and novel alternatives) and convergent thinking (a focused and affirmative evaluation of alternatives). The graphic representation does not contain thinking skills, and as such, the model is, in fact, the creative problem-solving model. It really becomes a thinking skill model in chapter 3, where several thinking skills are introduced: diagnostic thinking (for assessing the situation), visionary thinking (for exploring the vision), strategic thinking (for formulating challenges), ideational thinking (for exploring ideas), evaluative thinking (for formulating solutions), contextual thinking (for exploring acceptance) and tactical thinking (for formulating a plan). Each of the seven thinking skills is elaborated and illustrated. Affective skills that support the main thinking skills are associated with each step. By ‘affective’ the authors mean ‘the ways in which we deal with attitudinal and emotional aspects of learning, including feelings, appreciation, enthusiasm, motivations, attitudes, and values’. In the book, these affective skills are extensively argued and explained. In this review, I will only list them: curiosity, dreaming, sensing gaps, playfulness, avoiding premature closing, sensitivity to environment and tolerance for risks. © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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The second part of the book (chapters 5–11) presents practical process tools, designed to assist leaders in developing their own and others’ creative skills. The seven chapters correspond with the seven formal steps in the creative problem-solving process and the associated thinking skills. Chapter 8, for example, is dedicated to tools for ideational thinking. In this chapter the authors examine how leaders can generate ideas, and how they can also bring out the ideas of others effectively. Although divergent thinking seems to be dominant in this stage, a balance in divergent and convergent thinking is also required here. Several tools for divergent thinking, in particular brainstorming and forced connection, and tools for convergent thinking, hits and highlighting, are elaborated by the authors. Taking ‘forced connection’ as an example, the following six steps are indicated: 1. identify the challenge; 2. select an object unrelated to the challenge; 3. note the characteristics of the object; 4. force a connection between the object and the challenge; 5. repeat with additional objects; 6. use other senses and modalities. In the book, illustrations and practical suggestions bring these tools and the related schemes and models to life. A most relevant remark in this respect, repeatedly made by the authors, is that steps and sequences are not meant to be strictly followed. In their own words: ‘the creative problem solving process is flexible and allows you to move to any step in the process from here or to move out of the process completely. You can always go to Assessing the Situation to get your bearings and decide what to do next’. The third and final part of the book contains two numbered chapters (12 and 13), and two additional short chapters under the headings ‘Conclusion’ and ‘Case studies’. Chapter 12 explores the psychological diversity in how people approach creativity and change. In this chapter, two major approaches to understanding psychological diversity are examined. These are Kirton’s well-known adaptorinnovator theory and the initial research version of the Buffalo Creative Process Inventory, called FourSight. FourSight enables individuals to identify the degree of energy they have for four different process preferences: clarifier, ideator, developer and implementer. In the text, both Kirton’s theory and FourSight are elaborated and discussed in detail. Chapter 13 elaborates on psychological climate. Climate
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is, together with leadership, an important element of the work environment, which can either support or hinder creativity. By ‘psychological climate’ the authors mean ‘a person’s perceptions of the behaviors, attitudes, and feelings that typify everyday life in a particular setting’. Just like the other chapters, this one also contains quite a number of definitions, dimensions, rules and related explanations. In the context of creating conditions for a creative climate, Puccio and his co-authors refer extensively to the work of Ekvall and Amabile. In their conclusion, the authors once again stress creativity as a process and the need for developing creativity in leadership. The model for developing creativity in leadership has four maturity levels. It starts with the unconsciously unskilled level of a spectator and ends up with the unconsciously skilled level of the creative change leader. The two levels in between are respectively consciously unskilled and consciously skilled. At the end of the book, in the additional case studies, some examples of creative leadership, the use of creative problem solving and the importance of a creative climate are discussed. All in all, the book seems to be a good introduction to the creative problem-solving model and its related instruments. Its added value lies in the authors’ attempt to make this model applicable in the context of creative leadership. The book is very systematically structured, well embedded in relevant literature and practice oriented. It is close to one’s own experiences and feelings, and adds, at the same time, adequate concepts and recipes. The book is a good mixture of description, analysis and prescription, and not in a mechanistic way. It challenges the reader to reflect on what is going on, and suggests what has to be done by leaders in their complex and challenging environment. It can help students as well as reflective practitioners in management to bridge the gap between being an unconsciously unskilled and an unconsciously skilled creative leader. To really bridge this gap, learning by doing, experimenting and reflecting on one’s own experiences will also be important, of course. Therefore, Puccio, Murdock and Manche invite the reader at the end of the book to intelligently and reflectively apply their model and ideas on creative problem solving. On this, I fully agree with them. Olaf Fisscher
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Larsson, Ulf (ed.) (2006) Cultures of Creativity: Birth of a 21st Century Museum, Watson Publishing International, Sagamore Beach, MA and The Nobel Museum. 240 pp, ISBN 9780881353525.
At the beginning of the 20th century, a visionary man, Alfred Nobel, accomplished, albeit posthumously, his desire to reward creativity. In the year 2001, the 100th anniversary of the Nobel Prizes was celebrated with the launch of the first edition of Cultures of Creativity, a book especially dedicated to analyse the history of the famous Prize and the biographies of the more than 700 laureates, aiming to present various facets of human creativity. The present edition of the book, the second one, contains additional profiles and materials on laureates from 2001 and 2005. As is well know, in his last will Alfred Nobel left his fortune to be distributed annually according to certain criteria through a Prize that had received his name. He died in 1895, and leaving no children to inherit his fortune, Nobel decided that it should be used to create a fund to reward good ideas. During the 20th century, this Prize became a symbol of respectability and, as the editor of the book, Ulf Larsson, says, one of the most important brandings all over the world. By becoming acquainted with Alfred Nobel’s biography, as well as with the history of the Nobel Prizes, one certainly becomes more aware of the diversity of human creativity, as, for Nobel, in all the fields covered by the Prize, creativity had potential to flourish. Thus, through the history of the Prize, it is possible to become familiarized with the creations hidden within scientific discoveries as well as in literary works or campaigns for peace. Born in 1833 into a family devoted to innovations and industrial activity, Nobel had a cosmopolitan life, having developed intense efforts as an inventor, researcher and businessman. Alfred Nobel’s will certainly has affinity with the technological enthusiasm of late 19th century, according to which progress would be made by industrious and ingenious people. One of the richest men in Europe, he, himself, was an avid inventor, as well as a successful industrial baron, having built an international corporate empire and received more than 300 patents for his inventions. Systems of transportation – for people as well as for products – were of great interest to him. By the year 1873 his dynamite factories had spread through 14 countries all over the world, and he thus had a personal need to supervise the plants and also to have the products reach the final clients.
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The stories of the laureates illustrate different aspects of human creativity. Since all of them achieved innovation through different means, it is possible to identify in their stories, multifaceted aspects of it. The book poses relevant questions for those interested in studying creativity, such as ‘What is creativity and how can it best be promoted?’, ‘What is more meaningful in the creative process: individual creativity or the environment in which the work was developed?’, ‘How can creativity be achieved: through wild rebellion against establishment or a quiet walk away from the paths?’. Sometimes, it is the fruit of consequential, goal-oriented work, but at other times coincidence seems to be the main source of a discovery. Many of these factors were present in the life and work of Alfred Nobel himself, who functioned together with others as well as in the solitude of laboratories, and who was an imaginative dreamer and a rational technician, besides being a serious entrepreneur. From the book, two possible conclusions arise: (i) the heart of creativity is the ability to break away from convention; and (ii) in the creative process there is tension between the inner workings of an individual’s mind, and stimulation and effects of an individual’s surroundings. Let’s look at same examples. Amartya Sen, laureate with the Bank of Sweden Prize in Economic Science in 1998 and Milton Friedman, laureate with the same Prize in 1976, had almost nothing in common, neither milieu in which they were raised, nor the theories they embraced. While Sen dedicated his life to understanding the nature of poverty, Friedman was interested in monetary aspects of the world economy. While Friedman was raised in a wealthy environment, Sen lived a life of simplicity. In the same direction, it is possible to ask: what has Nelson Mandela to do with Isaac Bashevis Singer? And the answer would not be ‘nothing’, because these two brilliant men have, indeed, something in common, and the common quest is their belonging to their respective people; that is, while Mandela was a leader of South Africa, feeling strong connection with black people, Singer dedicated his whole life to a language – Yiddish – that connected him to Jews of Europe. Both were persecuted by their relationship with their people and it is possible to say that both developed © 2008 The Authors Journal compilation © 2008 Blackwell Publishing
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resilience to face the adversities put in their paths.1 These examples and many others are explored throughout the book. It is worth remarking on Yoruban mythology. According to this culture, Ogun – the God of creativity – has a dual aspect: creation and destruction. Thus, although Nobel firmly expressed in his last will that the Prize should reward efforts related to the construction of a better world, it is always possible that the opposite effect comes true. Nobel was aware of this fact and wrote a letter to Bertha von Suttner, his secretary, saying: ‘I should like to invent a substance or a machine of such terrible destruction that it would make war forever impossible’. Not only Good and Evil are opposite forces present in creative processes; it is also necessary to consider that creative people are often possessed by their creativity and they seem to be driven by opposite forces: the desire to serve the greater good without regard for personal profit, and a will for glory. One of the rules of the Prize states that no more than three persons can share it. Through all these years, some exceptions have been made for the Nobel Peace Prize, which has rewarded institutions rather than individuals. Nowadays, this rule could be problematic, since scientific work is often the result of a team or network, and one could ask simply who should be rewarded. As at the beginning of last century, when the Prize was institutionalized, the fact that creation could be a solitary work is an important aspect for those interested in researching creativity within modern organizations and institutions, and challenges the researcher with the question of environment and relationships appropriate for the flourishing of creative behaviour. Further conclusions can be drawn from the analysis presented in the book: creativity means discovering, producing or realizing something that did not exist before, but also 1
This concept of resilience as ‘applying lateral thought to generate innovative solutions when facing traumatic or adverse circumstances’ was proposed by the reviewer. See Barlach, L. (2005) ‘Human Resilience: A Contribution to Development of the Concept’, dissertation, at http:// www.teses.usp.br.
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can be seen as a new combination of already existing things. The relationship between individuals and the environments in which they lived and worked is presented in the book under the subtitle ‘Creative Milieus’. In this chapter, 16 environments are presented, in an attempt to answer the question posed by the editor: ‘What is it about a particular place that stimulates creativity?’ The question itself is substituted by another one: ‘What is an environment?’, because the concept of environment cannot be limited to an office, a building, a city or a country. Nor is it a group of people linked together by ties other than geographical location or a social atmosphere for exchanging ideas. Regarding the environmental aspect, the first precondition for the flourishing of creativity is the possibility of knowledgeable people, due to the fact that ideas require time to be developed. The second aspect is communication, in all forms: informal meeting areas and organizations and networks, as well. New ideas often spring in ‘border’ areas between different disciplines, and unexpected cross-disciplinary encounters may result in new combinations of knowledge and ideas. The third aspect related to the creative milieus is diversity and variation, if confronted with homogeneity and similarity. Another important remark: radical innovations may begin when a certain degree of instability and uncertainty prevails for the individual or for society in general. This instability makes it easier to break with customary patterns of thought and systems of rules. For innovation, in general, freedom, rather than hierarchies and regulations, is of benefit. Access to resources, whether economic or otherwise, seems to be a factor that facilitates creativity, but it is never a decisive element for its flourishing. Although the book is organized as a collection of stories intended to illustrate the concept of creativity, it is more than an introduction for studying creativity, once it compiles the fundamental issues that surround those studies. It does not focus on the concept itself, and this is not irrelevant at all because researchers are still far from defining it appropriately. Lisete Barlach
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Leermeester Award Jan Buijs Honoured with Leermeester Award
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ne of the founding fathers of the European creativity and innovation movement, and member of Creativity and Innovation Management’s Editorial Board right from the start, has been honoured by his own university. Jan Buijs received the Leermeester Award from the Rector Magnificus on 3 September 2007. The Leermeester Award is given to a full professor and chair from the Delft University of Technology to honour the laureate’s excellent qualities in teaching, in research and in having an important effect in the professional and academic field. We congratulate Jan Buijs on this prestigious award. Jan Buijs has been professor in Creativity and Innovation since 1986. His imprint on the European field of creativity and innovation is prominently shown by his long presidency of the European Association for Creativity and Innovation (EACI). The EACI wants to bridge academia (A), business (B), consultants/ trainers (C) and the outside world (D) in the field of creativity and innovation. This ABCD formula proved to be right at the heart of our
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domain. And we at Creativity and Innovation Management are proud to partner with the EACI. Under Jan’s leadership, the EACI was able to reconstruct its Dutch roots, and now has very firm foundations in Europe: the last three bi-annual European Conferences on Creativity and Innovation (ECCI) were organized in Mainz, Germany (2003), Lodz, Poland (2005) and Copenhagen, Denmark (2007). ECCI-XI will be held in Brussels in November 2009. Jan’s first article in Creativity and Innovation Management focussed on his ideas regarding Multi-X-teams (Vol. 7, No. 1, March 1998). He followed this in 2003 with his article, also published in CIM, on his improvement of the stage gate model of the innovation process (Vol. 12, No. 2, June 2003). In 2007, amongst other topics, Jan wrote about clustering as an explicit and separate stage between divergence and convergence (Vol. 16, No. 1, March 2007). As a tribute to Jan, these three CIM articles have been made available with free access on the Blackwell internet site. Olaf Fisscher (Editor of CIM) Han van der Meer (Secretary of EACI)
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Conference Report Impressions of the 10th European Conference on Creativity and Innovation, ECCI X 14–17 October 2007, Copenhagen Business School, Copenhagen
T
wenty years ago, in 1987, some brave men and women took the initiative to organize the first European Conference on Creativity and Innovation (ECCI 1) in the Netherlands. The name of this first conference was ‘Network in Action’. The spirit of this conference led a couple of years later to the establishment of the European Association for Creativity and Innovation (EACI) – a not-for-profit organization bringing national European organizations together in the field of creativity and innovation. Sharing ideas and opinions, meeting interesting colleagues and letting diversity into our hearts are the most important goals of the EACI. One of the means of achieving this is the organization of the bi-annual European Conference on Creativity and Innovation. The conference is always organized by one of the member states. This year ECCI X was held at Copenhagen Business School, Denmark. Over 360 participants were attracted by the jubilee of 10 ECCI conferences and the theme Cocreation. They represented 45 countries from all over the world. There were several keynote addresses and many sessions, there were reflection zones, there were social events in the evenings and there was a lot of bridging, talking, meeting old friends and making new ones. In short, an extraordinary conference extremely well organized by the Danish host: Danish Initiativ for Kreativitet & Innovation.
The rest of the keynote speeches can be divided into the Europeans on Cocreation (Danish Design Centre, Stockholm, Kirah, Buur and Elbek), the Americans on Cocreation (Austin, Gundling and Smith) and Danes on innovation in their companies (Jensen, CEO Grundfos; Knudstorp, CEO Lego). In the quality of the speeches there was a firm confirmation that the origins of the co-operative approaches in innovation lie in Europe and not in America. The conference was closed by a speech by Kirpal Singh. He gave an impressive overview of the cultural backgrounds and the cultural differences in approaches to creativity and innovation.
Papers and Other Parallel Sessions The conference is always a good mix of academic papers and practitioners sessions. This year there were 46 academic papers and 72 practitioner sessions. The practitioners were divided in the groups Toolbox, Case series, Weird Stuff and Play. The best academic papers will be published in Creativity and Innovation Management in a special issue. We will concentrate here on three basic trends in the papers and the sessions.
Trend 1: Cocreation Being the theme of the conference, a lot of papers and keynotes covered the topic of cocreation. Most contributions in this field were on early customer involvement and some on innovation in networks. Papers on Open Innovation systems were fairly rare. It seems the work of Chesbrough has not got a stable foothold in the EACI community.
Keynote Addresses
Trend 2: Use of Communication Technology
The grand opening speech was by Isaksen and Tidd. The former is a representative from the world of Creativity and the latter from the world of Innovation. The first time they both met was at ECCI 7 and they decided to write a book combining the both worlds: Meeting the Innovation Challenge (Wiley, Chichester, 2006). Their speech was on this book.
At this ECCI we saw a number of papers on the use of mobile phones, weblogs, the World Wide Web and so on. Although these papers mostly reported on a rather static use of these kinds of technologies in a fairly classical approach to creative problem solving and in innovation processes, it might be expected the next decade will bring a far more dynamic use
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of these technologies and changes in the creative or innovative process itself.
Next Conference – Brussels Autumn 2009
Trend 3: Sustainability
EACI stands for bridging academics, business and consultants in creativity and innovation throughout all Europe. Most of the ten previous ECCIs were held in the northern part of Europe, so now it is time to move southwards, starting in Brussels. 2009 will be the European year of creativity and Brussels the place to be. Following the tradition of EACI, the conference will invite academics and practitioners to contribute with papers and presentations. The Call for Papers and Presentations will be available from http://www.eaci.net and will be published in Creativity and Innovation Management.
Some papers and most of the keynotes addressed the topics of sustainability: people, planet and profit in balance. Both keynotes from the business world put emphasis on this issue and Uffe Elbek, Chairman of Kaos Pilots, devoted his speech to creativity for the children of the world. For the first time the conference had a special series of highly successful workshops, called the Care Cubicle, to develop ideas for society in general.
Meeting the Danes New in this conference was the high involvement of business during the four conference days. There were three excellent keynotes, permanent workshops in a lab-type setting by Lego and Grundfus, and on-site sessions with ten Danish organizations on the real challenges they face in the fields of creativity and innovation.
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Jan Buijs President Han van der Meer Secretary (
[email protected]) European Association for Creativity and Innovation
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