Selecting Innovation Projects: Do Middle and Senior Managers Differ When It Comes to Radical Innovation?

Abstract

Drawing on the attention‐based view, we theorize about the differences in middle and senior managers' choices to pursue innovation projects. We test our hypotheses in an experimental study examining the decision‐making processes of 180 senior and middle managers in selecting, or not, 2880 innovation projects. We find that managers differ in how they select innovation projects in general, and this difference becomes even more salient when such selections involve radical innovation. Specifically, when considering a radical innovation project, middle managers place more value on innovation characteristics required to complete the project, such as social capital and internal knowledge resources. In comparison, senior managers are concerned only with external knowledge resources, which can benefit radical innovation. Our study highlights the need to understand the role of middle managers, who frequently lead the implementation of innovation projects, and provides a theoretical underpinning for the differences in middle and senior managers' decision‐making.

Exploitation or Exploration? Managerial Myopia, Economic Policy Uncertainty and Ambidextrous Innovation Investment

“…Various perceptions of long-term and short-term time have diverse effects on human behavior. Wilden et al [14] showed that managers exhibit contrasting tendencies in selecting innovation projects, especially when radical innovation is involved. Time considerations are subjective in managerial decision-making [15], and short-term-oriented management tends to prioritize the present over the future, suggesting a myopic management characteristic.…”

Remembering Steven W. Floyd's Impact on Middle Management Research

“…Reflecting on their experimental study contrasting top and middle managers' differences in selecting innovation projects (Wilden et al, 2023), Ralf Wilden notes that 'through working with our MBA students, we recognized that many organizations continue to struggle to adapt to changes in the environment, often driven by radically new technologies and changed demand structures. Interestingly, our students, who are typically middle managers in their organizations, recognized that they have been provided with more opportunities than in the past to make decisions around innovation investments, given their closer proximity to the day-to-day business.…”

TMT's cognitive frame and breakthrough innovation

“…Recent research has empirically tested micro and macro factors that may affect the likelihood of producing breakthrough innovation (Tzabbar et al, 2023;Byun et al, 2023;Koh and Lee, 2023) and has explored breakthrough innovation through a temporal approach (Chen and Habibi, 2023), but our understanding of how breakthrough innovation generates over time is limited. In addition, previous studies have emphasized the decisive role of TMTs in high-impact innovations, such as radical innovation (Alexander and Van Knippenberg, 2014;Wilden et al, 2023) and exploratory innovation (Alexiev et al, 2010;Wang et al, 2019), but how TMTs affect breakthrough innovations is still underexplored. Therefore, drawing on the event system theory and the upper echelon theory, this paper conducts an exploratory case study to unpack how different types of events (proactive and reactive events), as well as TMTs' cognitive frames through its lens (a contracted lens and an expanded lens) and filters (capacity development, organizational identity and competitive boundaries) affect breakthrough innovations over time.…”

“…Firm innovation, such as disruptive innovation (Christensen et al, 2018;Antonio and Kanbach, 2023), business model innovation (Chesbrough, 2010;Ancillai et al, 2023) and radical versus incremental innovation (Dewar and Dutton, 1986;Wilden et al, 2023), has a long history in the literature and is rife with business practices. However, this is not the case for breakthrough innovation.…”

“…However, little research attention has been paid to unpack how breakthrough innovation generates along the process of a firm's development. In addition, although scholars agree that TMTs play a decisive role in strategic choices and organizational outcomes (Carpenter et al, 2004;Su et al, 2022), as well as technological innovation such as radical innovation (Wilden et al, 2023;Leifer et al, 2001), little is known about their functions in breakthrough innovations.…”