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Research Summary: We investigate how strategic leaders of an incumbent firm frame exploration of digital opportunities at the interfaces of organizational hierarchy. Digital technologies create an unbounded array of opportunities that may pose challenges to the strategic coherence of corporate entrepreneurship activity. Our analysis reveals that top management teams (TMTs) adopt a paradoxical framing of exploration, thereby creating a liminal space with unstable boundaries between exploration activities aligned with core resources (i.e., convergent) and those perceived as divergent. We show that middle managers (MMs) skillfully navigate this space by combining framing with substantive and symbolic actions to blur the boundaries of exploration. Drawing on our findings, we theorize the role of framing at the interfaces between the TMT and MMs in setting boundaries for exploration. Managerial Summary: The process of digital transformation can be overwhelming for established companies as managers encounter a myriad of new opportunities. Our study of a large telecommunications company found that both senior and MMs play important roles in guiding the development of new digital businesses. Senior managers encourage creative thinking and promote exploring multiple innovation opportunities. However, they also set boundaries to prevent innovation activities from becoming too risky by venturing into very distant domains. This contradictive requirement creates a “gray zone” for MMs to imaginatively use their skills to navigate restrictions without compromising exploration of new opportunities. This approach involves both top‐down and bottom‐up communication between senior and MMs that helps avoid short‐sightedness and overspending when it comes to innovating with digital technologies.

High-reliability organizations (HROs) and their complex operating models have been a focus of scholarly work for more than three decades. Recently, HROs have been challenged by new market pressures that require them to digitally transform in ways that affect their identity and value creation models while still maintaining high levels of security and efficiency. This longitudinal, in-depth single-case study of a major European utility company examines the role of HRO identity in digital transformation (DT), specifically in terms of tensions between innovation and transformation on the one hand, and maintaining reliable operations on the other. Our findings show how tensions between HROs’ identity and key features of DT give rise to threat perceptions and self-protective behaviors by the IT workforce, that eventually may derail the transformation process. We develop a process model that highlights the sources and consequences of identity misalignment during major DT initiatives in HROs. In doing so, we extend the research on D T by highlighting the importance of bottom-up processes for DT success and failure, especially concerning the IT function's perception of organizational identity.

Desorptive capacity is the organisational ability to transfer internal knowledge to external actors to obtain competitive advantage. We distinguish two forms of desorptive capacity to investigate how organisations active in emerging technology domains explore and exploit opportunities to match internally developed technology to external needs. We also focus on management innovation–the ability to create or revise organisational structures or processes–as a potential antecedent of desorptive capacity. From a study of 84 synthetic biology organisations we found that explorative and exploitative desorptive capacity mediate the relationship between management innovation and external technology commercialisation. The study provides empirical evidence of the existence and interdependence of different managerial and organisational processes required for external technology commercialisation. We underscore how organisations can valorise technological assets strategically through management innovation and by achieving a fit between internal practices and the technological base of potential technology adopters.

Increasingly, organizations have been employing self-managing teams to circumvent bureaucratic controls and stimulate innovation. However, this goal is not easily achieved; in many situations, informal controls replace formal controls. This study develops a multi-level perspective of control. We explicitly analyze control mechanisms at different levels of the organization and how they affect innovative team output. We theorize and empirically investigate a potential downside of horizontal social control mechanisms at the team level (i.e., peer pressure) affecting self-managing teams’ innovative outcomes. We also discuss managerial control mechanisms at the organizational level (i.e., interactive and diagnostic management control systems) that may help to mitigate such negative effects. We theorize how they may influence the innovative output of self-managing teams, both directly and interactively. We chose a multi-level, multi-source setting for our study and ran three parallel surveys with employees in a Fortune 500 firm. 248 team members, 126 internal team leaders, and 97 organizational leaders enabled us to create a unique database of 97 self-managing software development teams. Our findings confirm that peer pressure is common among established agile teams and that it negatively influences the innovative output of the agile teams. Moreover, our findings show that the magnitude of the effect of peer pressure is contingent on control mechanisms at higher levels within the organization. This enables us to provide new theoretical insights regarding the paradoxical effect of managerial control systems when it comes to flat organizations and autonomous teams. Additionally, we provide practical guidelines for managers who increasingly adopt agile practices but at the same time face issues with regard to innovation.

Research summary: How firms respond to the emergence of dominant platforms that undermine their competitiveness remains a strategic puzzle. Our longitudinal study shows how one incumbent, Cisco, responded to such a challenge by creating a new platform, Fog, without undermining the dominant platform, Cloud, where it played a complementor role. By developing a process model we reveal how a firm in a peripheral role in a platform ecosystem can reposition itself through a dynamic mix of material, symbolic and institutional actions to develop and legitimize an alternative platform. This can be done first through symbiosis with the dominant platform, then partial competition with it. We theorize the value of a mutualistic “rising tide lifts all boats” strategy in contrast to hostile “winner takes all” approaches. Managerial summary: The increasing pervasiveness of digital platforms are driving established firms to reboot their strategy to embrace emergent forms of competition, collaboration, and mutual coexistence. Fearing disruption in their traditional business models, firms may decide to jump into the platform game. However, this is not straightforward since they do not want to go head-to-head with existing platforms and alienate their partners and customers by being perceived as encroaching on their turf. We describe one way that established technology firms are overcoming this dilemma through a “rising-tide-lifts-all-boats” strategy to cultivate new platforms. We show the value of seemingly inconsistent and dynamic approaches toward strategic communication and investments firm can use to lead new platforms without facing backlash from others.

As digital technologies such as cloud and edge computing, machine learning, advanced artificial intelligence (AI), and the internet of things (IoT) unfold, traditional industries such as telecoms, media, entertainment, and financial services are being reconfigured and new sectors are emerging. In this new competitive landscape we observe new organizational forms and new business models, including the emergence of platforms and multi-sided markets. This emergence has required a strategic response from incumbent firms, including both well-established firms and some first-generation digital enterprises. With these advances in digital technology, the very nature of strategy is changing. Fundamentally, the use of digital technologies may provide new opportunities for efficiency gains, customer intimacy, and innovation. However, without the right mindset for change, appropriate digital routines, and structural changes, digital transformation efforts will fail. We therefore present a framework for strategizing in this new digital competitive landscape that underscores the importance of the interplay between (1) the cognitive barriers faced by managers when trying to understand this new digital world and envision new digital business models, (2) a need to reconfigure and extend digital routines, and (3) new organizational forms that are better equipped to creating value and gaining competitive advantage. From this framework of essential pillars, we derive four journeys of digital transformation for companies that were formed in the pre-digital economy. We also describe the management roles required by top, middle, and frontline managers, depending on whether the digital migration is evolutionary or transformative and whether the firm is responding to or attempting to shape the ecosystem. Although digital transformation is technically all about technology, the more important issue is how companies make their way through this strange new digital world in which they find themselves. Ultimately digital transformation is as much about strategizing as it is about technology.

The ability of an organization to cope with radical technological change is regarded to be heavily dependent on its ability to absorb and apply knowledge from its environment. This study investigates the role of organizational structure in driving absorptive capacity and uncovers the role of the emergent phenomenon of organizational energy as the enabler of this relationship. A field study was conducted among firms that are challenged by the disruptive nature of Cloud computing. Our results show that organizational design affects the degree of mobilization of an organization's affective, cognitive and behavioral resources, which in turn influence the effectiveness of learning processes related to the absorption and exchange of knowledge within the organization. Furthermore, they reveal the positive relationship between the enactment of absorptive capacity and the successful adoption of Cloud technology for incumbent firms. The findings contribute to our understanding of the micro-foundations of absorptive capacity and how positive organizational phenomena facilitate effective adoption and implementation of emerging technologies.

Contains fulltext : 170193.pdf (Publisher’s version ) (Closed access) We develop a psychological perspective on managers’ exploration orientation. Our study suggests that the regulatory focus of managers may in different ways, impact their orientation toward search, risk-taking, and experimentation. Moreover, we argue that these relationships are contingent not only on the extent to which the organizational context fits with the motivational disposition of managers, but also on the complexity of decision-making. Using an experimental setting, we find that managers’ regulatory focus affects their willingness to experiment with a wide range of alternatives and to deviate from existing best practices. Moreover, the promotion focus of managers heightens their exploration orientation in an organizational context with promotion-focused cues in highly complex decision-making. This study has important implications for our understanding of managers’ exploration orientation under conditions of complexity. 23 december 2016

Although exploratory units constitute a structural mechanism that buffer rigidity and inertia from firms’ core businesses, tensions and challenges may arise when there is a changing strategy at the corporate level that misaligned with the initial purpose of the unit. In this paper, we explain how managers in spatially separated exploration units of an organization deal with the conflicting requirements of exploring emerging industries and senior executives’ initiatives to align the organization around the temporal focus on restoration of core businesses. We uncover internal mechanisms that reveals how an exploratory unit become ambidextrous that enable them to maintain a strategic alignment with the main organization while ensuring required adaptability for exploration in emerging industry. Our findings draw on the longitudinal analysis of exploration activities of a business unit at a global telecommunication firm that responsible for pursuing opportunities in the emerging Internet of Things industry (IoT) between 2015 and 2019. This study contributes to extant literature by developing a link between contextual and structural ambidexterity at the business unit level, and particularly, by showing managerial approaches through which an organizational unit become ambidextrous.

In adopting highly integrated Product-Service Systems (PSS), incentive structures change and the value attainable for providers throughout the lifecycle becomes an issue of growing complexity. Nonetheless, value for PSS providers has up to now not been considered in a multidimensional fashion. In an effort to move towards a characterization of providers value, an offering in the information communication technology sector was examined through an investigation with ten staff-members of Ericsson, Sweden. This led to a value-categorization, which can be utilized in the PSS design process to enhance the value captured throughout the lifecycle beyond immediate monetary benefit. In an effort to provide general learnings, the results are discussed with a focus on PSS business models, PSS design and management communication. Overall, the results presented provide a more comprehensive picture of what a provider has to gain from a PSS offering throughout its entire lifecycle. (C) 2016 Elsevier B.V.

Prior research provides in-depth insights about strategies for new ventures to compete in existing platform ecosystems. However, we know relatively little about the process of creating new platform...

Innovation has since long been known as key to organizational success and survival, which has driven in particular large technology firms to systematize their research and development activities an...

Contains fulltext : 170237.pdf (Publisher’s version ) (Closed access) Contains fulltext : 170237_pre.pdf (Author’s version preprint ) (Open Access) Prior research has emphasized the importance of organizational focus on exploratory behavior in response to the emergence of a revolutionary core technology and the associated uncertainties. The question of why some organizations are more successful than others at realizing and reacting to such a need has not yet been fully addressed. In particular, empirical evidence on the effects of customer orientation on the effectiveness of organizational responses to major technological changes is somewhat mixed. We develop and test a theoretical argument in which we emphasize an indirect link between customer involvement in innovation processes and exploratory behavior in emerging technology fields. In so doing, first we illustrate the part played by two managerial factors — attention to the technology and the introduction of non-routine organizational adaptations — in enabling exploratory activities such as experimentation and search for unfamiliar knowledge in a new technology field. Second, we discuss how customer co-creation contributes to both of these managerial factors and, consequently, indirectly stimulates exploratory behavior in these conditions. We provide empirical support for our related theoretical framework by means of six case studies and a survey among 131 companies that were adopting a similar emerging technology; i.e., Cloud computing. 21 januari 2016

This paper presents the findings of a longitudinal study of a large corporation's transition to a new business model in the face of a major transformation in the ICT industry brought about by Cloud computing. We build theory on the process of business model innovation through a qualitative study that investigates how an established firm organizes for an emerging business model. Contrary to previous findings that presented spatial separation as the optimal structural approach for dealing with two competing business models, our findings indicate a need for recursive iterations between different modes of separated and integrated structures in line with the emergent nature of strategic intent toward the new business models. Our analyses reveal strategy formation to be a collective experimental learning process revolving around a number of alternative strategic intentions ranging from incremental evolution and transformation to complete replacement of the existing business model. Given the fundamental differences in the nature and requirements of those alternative intents, iterations between different structural modes and differing combinations proved to be crucial in enabling the organization to make transition to the new business model.

Although exploratory units constitute a structural mechanism that buffer rigidity and inertia from firms’ core businesses, tensions and challenges may arise when there is a changing strategy at the corporate level that misaligned with the initial purpose of the unit. In this paper, we explain how managers in spatially separated exploration units of an organization deal with the conflicting requirements of exploring emerging industries and senior executives’ initiatives to align the organization around the temporal focus on restoration of core businesses. We uncover internal mechanisms that reveals how an exploratory unit become ambidextrous that enable them to maintain a strategic alignment with the main organization while ensuring required adaptability for exploration in emerging industries. Our findings draw on the longitudinal analysis of exploration activities of a business unit at a global telecommunication firm that responsible for pursuing opportunities in the emerging Internet of Things industry (IoT) between 2015 and 2019. This study contributes to extant literature by developing a link between contextual and structural ambidexterity at the business unit level, and particularly, by showing managerial approaches through which an organizational unit become ambidextrous.

The creation of an online strategy community is increasingly attractive for companies as a mean to make the strategy process more inclusive. However, the fundamental difference between the flexible...

This paper examines the effect of management innovation on a firm's ability to effectively adopt an emerging core technology. Organizing for technological change is often associated with structural dilemmas for incumbents: while structural contingent solutions such as spatially separated units and parallel organizations have been frequently discussed as enablers of handling contradictory requirements of existing and emerging technologies, there is empirical evidence that such solutions are likely to be either unfeasible or unsustainable in the cases of core technologies. Our analysis on the adoption process of a new core technology by a large telecommunication firm reveals the role of management innovation in fulfilling seemingly paradoxical structural requirements of knowledge accumulation in a dynamic knowledge environment. We discuss how a novel structural approach enabled the organization to overcome rigidities in the existing routines and foster a favorable environment for adoption of cloud technology and to overcome organizational challenges, with which the firm's conventional practices failed to commensurate.

Established firms aspiring an alternative to a technological platform that undermines their competitive position confront the dilemma of seeking their own economic interests and gaining legitimacy ...

As a response to competitive and economic pressures, large organizations are increasingly seeking new business ideas from employees across different units of organizations. However the org...

In the past decades, collaboration has become increasingly important for organisations involved in highly complex and evolving areas of knowledge. Synthetic biology is an emerging techno-scientific...

This study contributes to better understanding of what effects business model innovation in a multinational enterprise and sheds light on ways for MNEs to respond to diverging requirements of globa...

In this study we investigate organizational control systems as the underpinnings of large organizations’ ability to perform after transition to a flattened and decentralized structure. We consider ...

The involvement of customers, also known as co-creation, is believed to affect the innovation performance of a firm. Indeed, past studies have provided ample support for the positive effects of customer involvement on product quality, innovation speed, and productivity; but the discussions on the effectiveness of co-creation for achieving radical innovations and the drivers of this relationship are less clear. By examining the effects of collaboration with customers on senior managers’ attentiveness and behavior in favor of exploration, we advance the understanding of the link between customer co-creation and radical innovations. Analysis on six case studies and a survey of 131 companies adopting a similar emerging technology indicate a higher probability for exploratory innovation among the companies that co-create with their customers. Our findings further suggest that managerial attention and management innovation are two factors that mediate this relationship.

The ability of an organization to prosper in highly volatile and often disruptive environment is mainly dependent on its ability to profitably manage its internal and external sources of knowledge. Two key structural factors such as centralization and formalization have been suggested in the literature to play an important role in this process. Organizations however, are socially constructed entities and knowledge related capabilities, remain socially founded primarily in the emotions and cognition of individual members. By adopting a behavioral strategy lens, we explore the underlying mechanism connecting structure to AC by investigating the mediating role of organizational energy (i.e. the mobilization of the emotional, cognitive and behavioral resources of an organization). A survey was conducted among firms that are challenged by the disruptive effect of cloud computing. The results suggest that energy mediates the impact of decentralization on absorptive capacity, while the equivalent effect of forma...

Prior research contends that managerial cognition plays an important role in explaining the firm’s effective response to environmental dynamism. However, evidence suggests that firms may cope with ...

The purpose of this research was to develop a framework of how incumbent firms organize for adoption and implementation of an emerging disruptive business model. The framework, based on an in-depth...

Management innovation is speculated to be an enabler of technological change by way of adoption or development of new technologies. However, the precise dynamics of the mechanism that drive this relationship are not fully understood. Drawing on the concept of absorptive capacity in the organizational learning literature, this article examines how routines that give gestalt to the prevalent organizational structures, systems and practices influence the adoption or non-adoption of emerging technologies. We complement our theoretical analysis with an in-depth case study of Ercisson’s experiences with Cloud Computing Technology (CCT). The case provides a unique opportunity to explore how organizational innovation determines managerial motivation and organizational pace to embrace a disruptive new technology whose full potential is not as yet understood. Our article provides evidence for a recursive relationship between managerial attention to a new technology, management innovation, and technology adoption, w...