innovative relationships
first to reveal the link
between the theory of
collective orientation
T H E S I S
A u g u s t 2 0 0 7
I N N O V A T I V E N E S S I N S O C I A L N E T W O R K S
U N I V E R S I T Y O F G R O N I N G E N F A C U L T Y O F E C O N O M I C S A N D B U S I N E S S P R I M A R Y S U P E R V I S O R : J A N K R A T Z E R S E C U N D A R Y S U P E R V I S O R : N I E L S F A B E R E R W I N V A N D O E S E L A A R 1 2 7 1 2 8 8I N N O V A T I V E N E S S I N S O C I A L N E T W O R K S
I
N
D
E
X
S U M M A R Y . . . 4 P R O B L E M S T A T E M E N T . . . 5 I N N O V A T I V E N E S S I S T H E G O A L . . . 5 S c i e n t i f i c r e l e v a n c e . . . 5 B u s i n e s s r e l e v a n c e . . . 6 T H R E E Q U E S T I O N S A N D T H R E E L E V E L S O F A B S T R A C T I O N . . . 7 A P P R O A C H . . . 7 F o r m o f d a t a . . . 7 L I T E R A T U R E S T U D Y . . . 8 I N N O V A T I V E N E S S D E F I N E D . . . 8 I n n o v a t i v e i n t e r p e r s o n a l i n t e r a c t i o n . . . 1 0 I n n o v a t i v e n e s s b e t w e e n d e p a r t m e n t s . . . 1 0 I n n o v a t i v e n e t w o r k s . . . 1 1 H O W D O E S I N N O V A T I V E N E S S O C C U R ? . . . 1 1 W h a t c h a r a c t e r i s e s i n n o v a t i v e i n t e r p e r s o n a l r e l a t i o n s h i p s ? . . . 1 2 T h e o c c u r r e n c e o f i n n o v a t i v e i n t e r d e p a r t m e n t a l r e l a t i o n s h i p s . . . 1 4 C O N C L U S I O N . . . 1 6 M E T H O D S . . . 1 7 I N T E R V I E W S A N D S A M P L E . . . 1 7 I N N O V A T I V E N E T W O R K . . . 1 7 H y p o t h e s i s I . I n n o v a t i v e c o n t a c t s o c c u r m o r e f r e q u e n t l y w i t h i n a h o m o g e n e o u s g r o u p t h a n b e t w e e n g r o u p s . . . . 1 8 H y p o t h e s i s I I . T h e a s s o c i a t i o n b e t w e e n t e n u r e a n d i n n o v a t i v e n e s s i s i n v e r s e l y U - s h a p e d . . . . 1 9 H y p o t h e s i s I I I . A c c e s s t o d i f f e r e n t s o u r c e s o f i n f o r m a t i o n e n h a n c e s i n n o v a t i v e n e s s . . . 1 9 H y p o t h e s i s I V . C o o p e r a t i v e n e s s e n h a n c e s i n n o v a t i v e n e s s . . . . 2 0 H y p o t h e s i s V . C o n f l i c t h i n d e r s i n n o v a t i v e n e s s . . . . 2 0 H y p o t h e s i s V I . I n f o r m a t i o n p r o c e s s i n g r e l a t i o n s h i p s a r e p r e r e q u i s i t e f o r i n n o v a t i v e r e l a t i o n s h i p s . . . . 2 1 M e t h o d s c o n c e r n i n g i n d i v i d u a l r e l a t i o n s h i p s . . . 2 1 I N T E R G R O U P R E L A T I O N S H I P S . . . 2 1 C O N C L U S I O N . . . 2 2 R E S U L T S A N D I N T E R P R E T A T I O N S . . . 2 3 R E S U L T S O F Q U A N T I T A T I V E A N A L Y S E S . . . 2 3 H Y P O T H E S I S I . . . 2 3H Y P O T H E S I S I I . . . 2 3 H Y P O T H E S I S I I I . . . 2 4 H Y P O T H E S I S I V . . . 2 5 H Y P O T H E S I S V . . . 2 5 H Y P O T H E S I S V I . . . 2 5 I N T E R G R O U P I N N O V A T I V E N E S S . . . 2 5 N E T W O R K C O N F I G U R A T I O N . . . 2 6 H E T E R O G E N E O U S I N P U T . . . 2 9 C O L L E C T I V E O R I E N T A T I O N . . . 2 9 C O N C L U S I O N . . . 3 1 I N T E R G R O U P I N N O V A T I V E N E S S . . . 3 2 C O N C L U S I O N S . . . 3 3 H O W D O I N N O V A T I V E R E L A T I O N S H I P S O C C U R ? . . . 3 3 S t r u c t u r e s m a t t e r . . . 3 3 F a v o u r f r e s h m e n . . . 3 3 I n f o r m a t i o n i s p o w e r t o i n n o v a t e . . . 3 4 I n n o v a t i o n i s n o s e r e n d i p i t y . . . 3 4 H O W C A N I N N O V A T I V E N E S S B E P R O M O T E D ? . . . 3 4 U n i t e . . . 3 4 B e b o l d . . . 3 5 W h e r e t o b e g i n ? . . . 3 5 A C A D E M I C C O N T R I B U T I O N . . . 3 6 I N N O V A T I O N F O R B U S I N E S S S U C C E S S . . . 3 7 E V A L U A T I O N . . . 3 8 R E F E R E N C E S . . . 3 9
I N N O V A T I V E N E S S I N S O C I A L N E T W O R K S
S
U
M
M
A
R
Y
This thesis theoretically and empirically investigates causes of innovativeness through analyses of various social networks. It links the theory of collaboration with the theory of innovation and contributes to debates about innovation, knowledge transfer, and social capital. The hypotheses (5) that conflict hinders innovativeness, and (6) that information processing relationships are prerequisite for innovative relationships, were rejected. The hypotheses (1) that innovative contacts occur more frequently within a homogeneous group than between groups, (2) that the association between tenure and innovativeness is inversely U-shaped, (3) that access to different sources of information enhances innovativeness, and (4) that cooperativeness enhances innovativeness, were accepted. Additionally, a multiple case study revealed that an open network is most favourable for a department’s
innovativeness, but whether it is positioned upon flows of information and whether its relations are cooperative does not affect innovativeness. Management recommendations tell how to enhance innovativeness through traditional practices. Academic contributions include empirical evidence about collaboration and innovation between groups.
P
R
O
B
L
E
M
S
T
A
T
E
M
E
N
T
This chapter constrains the investigation by means of a research question. It will explain the relevance of the issue and provide with a division into sub-questions. Consequently, it will introduce the thesis.
I N N O V A T I V E N E S S I S T H E G O A L
The current investigation pursues to discover how interaction of departments and individuals
influences innovativeness. This subject is highly relevant for business science as well as for the
company studied on. This thesis will be among the very first empirically linking the theory of collaboration and competition with innovativeness on the level of intergroup interaction.
S c i e n t i f i c r e l e v a n c e
Once this study will be finished it will have produced a relevant piece of knowledge. It contributes to several contemporary scholarly discussions. The next paragraphs will briefly mention each of these debates.
Many recent publications in top journals deal with organisational learning, knowledge transfer, innovativeness, and related topics. These gain high amounts of interest, because it is increasingly more strongly realised that knowledge is a firm’s foremost asset, rather than financial resources. Company’s returns on investments are no longer deemed to mainly result from finances. The activities of hedge funds on stock markets is one signal of the eased availability of capital. Knowledge is harder to transfer than money, and hence more important to gain business competitions.
The question scholars are after in general is how to leverage knowledge into bottom line figures. This thesis will contribute to that research area by an assessment of innovativeness and its causes.
A next debate the current thesis will contribute to is between the source of social capital. Social capital has to do with the structure of peoples relations and their achievements. Coleman (1988) arguments that network closure leads to information diffusion. If you are interested in world news, you may ask a friend for updates rather than read it from the papers yourself. And Coleman declares that close networks lead to shared norms and possibilities of sanctions, hence invoking trust and preventing costs. Oppositely, Burt (e.g. 2000) sees opportunities for brokers. Brokerage is per definition possible between groups. Dense networks avoid brokerage. Burt explained all data he found as evidence for the argument that brokers are better off. This study will deal with the matter whether open networks or closed networks are favourable for innovativeness. On the level of individuals the question is whether it is favourable to be boundary spanning between groups or to be member of some dense group of familiar colleagues.
Lastly and most significantly, this study will test claims that a collective orientation among a group of people is prerequisite for innovative performance. As people can only learn from other people who know what they don’t, knowledge creation is about gathering people with different knowledge bases. The stimulus to join different people is found in a perception of mutual gain: both the teacher and the learner see an advantage. This study pays significant attention to these collaborative relationships and the connection with innovativeness.
I N N O V A T I V E N E S S I N S O C I A L N E T W O R K S
M u l t i p l e l e v e l s
This argument of collaboration has been regularly found in literature, but it has only been tested among team members rather than network wide. This endeavour is expected to form the main contribution to the current body of knowledge in the discipline of business science.
Through network analyses multiple levels of interaction can be investigated with one data set. The lowest level in this study is the individual and interaction among individuals. A number of individuals will be involved in the sample and their relationships form a network. The total set of relationships one individual holds is addressed as the ego network. Grouping the individuals at the level of groups of individuals, the same sorts of networks occur. E.g. information sharing among individuals can be aggregated to a network of information sharing among groups. The total set of relationships of a group is addressed as the ego network of that group. Lastly, there is the entirety of relationships: the network as a whole. Social network analyses allow to investigate each of these levels of abstraction.
This particular method of social network analyses enables to reveal variables on the multiple levels. Conclusions about associations between the variables can therefore properly attribute causes to each of the levels, whereas studies relying on data with attributes of some sample cannot. The literature study will provide with arguments on each of these levels.
B u s i n e s s r e l e v a n c e
This thesis will cover both a literature study and an empirical investigation. After having carried out the analysis of a real-life case, those participating in the examined company will be provided with insight in activities that will enhance innovativeness.
As the particular company is expected to resemble many others with regard to the challenges it faces, the results of this study can be generalised to comparable firms.
Modern companies are increasingly aware of the need of innovation for competitiveness. Most companies – in particular the smaller ones – attempt to innovate by allowing for special customer requests. Rather than pursuing brake-through innovations, they try to incrementally develop according to client wishes. The subsequent findings are eventually applied in new generations of their standard products. Related difficulties are manifold, but the major challenge is to remain innovative. Customers can not be expected to describe the inexistent. No customer will ask for a product that does not come to mind. Therefore, many companies are strongly challenged to innovate. Innovativeness never occurs by chance.
The theme of a collective orientation is of interest to many managers as well. Classical management practices of a departmental division of tasks easily result into parochial thinking where professionals defend their own piece of work. Despite concepts like the project organisation, the matrix organisation, communities of practice, etcetera, small isles of myopic employees are observed widely. The
deepened insight in consequences of the existence or non-existence of a collective orientation on the various levels of a company may be helpful for effective management.
Moreover, preliminary investigations among the sample revealed that company politics affected behaviour and decisions. Certain professionals cooperated to the least possible extent. Therefore, it is of use to question how collaboration affects innovativeness.
The results of this study can be generalised unto all comparable companies, because all face the challenge to grow in innovativeness.
T H R E E Q U E S T I O N S A N D T H R E E L E V E L S O F A B S T R A C T I O N
To achieve the purpose of this investigation three questions will be given answers to. First is about the ontology of innovativeness.
A. What is innovativeness?
This needs to be split according to three levels of abstraction.
a. What characterises innovative interpersonal relationships? b. What characterises innovative interdepartmental relationships? c. What characterises innovative social networks?
The second question is about the causes of innovativeness.
B. How does innovativeness occur?
a. How do innovative interpersonal relationships occur? b. How do innovative interdepartmental relationships occur? c. How does an innovative network occur?
These both questions can accumulate into one third which translates all into effective activities.
C. How can innovativeness be enhanced?
A P P R O A C H
The remainder of this thesis will step by step lead to firmly based answers on the main question. Hence, a literature study will follow. Based on academic publications the study questions will be answered as in depth as possible. Moreover, gaps in the body of knowledge will be identified to justify the current investigation.
The theoretical chapter enables to derive hypotheses from the research questions. The subsequent part about methods and measures will explain how the empirical examination was performed. The case study yields results, which are interpreted in the successive chapter titled results. All this accumulates into the conclusions and recommendations.
F o r m o f d a t a
The empirical analysis of this investigation will mainly rely on social networks as source of data. The collected data will consist of an information sharing network, which among the actors of that network tells who has an information sharing relationship with whom. It will, moreover, consist of an innovative network, of a co-operative network, of a competitive network. These all tell what sort of relationship different actors have. Besides, information on the actors will be available. Certain variables will be assessed, like job tenure, and management position. Lastly, all actors will be prompted for their best idea to indicate their personal contribution to the firm’s innovation processes.
I N N O V A T I V E N E S S I N S O C I A L N E T W O R K S
L
I
T
E
R
A
T
U
R
E
S
T
U
D
Y
I N N O V A T I V E N E S S D E F I N E D
This section will explain innovativeness by building from the least abstract level – innovative
interpersonal interaction – via the intermediate level – innovative interdepartmental interaction – to the most abstract level – innovative social networks.
This study is constrained by its definition of innovation. Therefore, this paragraph sets out what other authors include within that notion and it makes clear what the current analysis excludes.
As the word innovation etymologically concerns newness, this is the one item authors appear to agree about. Innovation has to do with novelty.
Most definitions include the conception of the new idea. E.g. the idea of a vehicle with a combustion engine. E.g. Wejnert (2002) says innovation refers to abstract ideas and concepts, technical information, and actual practices within a social system.
A next phase is the development of knowledge. This perception would declare Michelangelo’s technical drawings as innovative. Authors opting for this definition generally focus on group learning.
Sometimes innovation means R&D or innovation projects. (E.g. Swink, 2006, Tether, 2002) Authors applying this definition may use innovation and new product development as synonyms.
The understanding of innovation can be limited to an outcome, e.g. a car. Technical managers and technologists are found as advocates of this definition.
Certain authors go a step beyond the outcome and include adoption of the novelty. These studies generally focus on the diffusion of innovations among e.g. organisations or countries and generally come from marketing scientists. (Gopalakrishnan and Damanpour, 1996) These say e.g. the 19th century development of the automobile and its adoption by the first drivers together formed an innovation in transport. E.g. Granovetter (2005) conceptualises innovation as relevant to markets. West and Anderson (1996) define innovation as the introduction and application, within a group, organization, or wider society, of processes, products, or procedures new to the relevant unit of adoption and intended to benefit the group, individual, or wider society.
Considering all the above, innovation can be seen as a process of stages. These are idea conception, development, realisation, and adoption. This thesis is limited to the first two phases and
innovativeness is defined according to Nonaka (1994) as a process in which the organisation creates and defines problems and then actively develops new knowledge to solve them. This definition requires some more explanation. On each of the elements will be expanded.
Organisation is perceived of as a set of human relationships. As below arguments will clarify, knowledge according to this study can be created between people. Therefore, even though only individuals can know and remember, organisations act with problems and knowledge. Humans within
their networks of relationships form organisations. Interaction can raise knowledge creation in manners described below.
Creation and definition of problems triggers innovation. When problems emerge and are recognised as such, this stimulates individuals or groups towards problem solving. Vice versa, problems are solved only after explicit or implicit problem definition. Of course, people can solve certain problems individually and people solve other problems collectively. When one solves a problem on his (/her) own, knowledge is created by trial and error. Moreover, joint problem solving makes knowledge flow between individuals and creates knowledge by trial and error as well. Therefore, every solved problem implies knowledge creation.
Active development of new knowledge is the final point of innovativeness in this thesis. An example clarifies how encountering problems and joint problem solving implies knowledge creation. Imagine a situation with three light switches, two men, and one lamp. One man knows the right switch does not work, the other knows the left switch does not turn the light on. Combining their knowledge, the two can draw the conclusion that the middle switch functions to turn the light on. Knowledge is build, namely, afterwards the two man know that the middle switch is the one to lit the light. Even though the previous example feels somewhat oversimplified, it shows combining knowledge can create
knowledge while collectively solving problems.
As this thesis adopts a dynamic perspective on organisations, it adopts a theory of knowledge conversion leading to innovation as opposed to the theory of information sharing. The theory of information sharing makes several statements about cognitive operations. It reasons from a flow of information from which the individual picks what he (/she) believes is right. From the totality of believes the individual can make associations which are retrieved (i.e. remembered) when related to some input. (See e.g. Tybout, e.a., 1981) The prevailing characteristic of the individual as well as the collective (i.e. the organisation) is: input – process – output. The theory implies that the better the information processing, the more effective the entity acts in its dynamic context. The theory does not take into account that humans and organisations can create information. The creation of information continuously takes place when handling information.
The view that information processing affects innovativeness is not challenged here, but it is added that the creation of knowledge plays a critical role. The process of knowledge creation may be understood as a consequence of knowledge transfer. Namely, some professional inquires about some issue to be handled, which invokes an information transfer. The newly acquired information immediately finds application in the particular issue at stake. When through this process new combinations result in new applications, knowledge is created. The new application of the previously existing knowledge is a genuine form of innovation. This continuously occurring process associates knowledge transfer and knowledge creation.
All in all, innovativeness is about interaction, problem creation, definition, and solving, and knowledge development.
I N N O V A T I V E N E S S I N S O C I A L N E T W O R K S I n n o v a t i v e i n t e r p e r s o n a l i n t e r a c t i o n
For an individual to be innovative it requires the creation of knowledge. In other words, innovation relates to learning. Learning can occur through four modes and each of these modes is related to particular behaviour.
Moreover, learning is not only understood in the classical sense. One should not think of learning as an activity separated from daily life, and end in itself, and tested by individual exams that consider collaboration as cheating. Learning is understood as an integrated part of daily life. Following Nonaka (1994), three sorts of activities spread knowledge.
First, there is knowledge transfer between individuals that does not require language: socialization. Many apprentices learned jobs by observation, imitation, and practice. Note, moreover, that without some form of shared experience, it is extremely difficult for people to share each others’ thinking processes.
Second, combination addresses another mode of knowledge conversion. Much information is shared through such exchange mechanisms as telephone conversations or meetings. When knowledge is applied in a new context, it may lead to new knowledge.
Lastly, the process of internalization is comparable to the traditional notion of learning. Externalization articulates tacit knowledge. Internalization and externalization are complementary and can expand over time through interaction. This interaction involves two different operations. Speaking in metaphors plays an important role in externalization. Action relates to internalization.
In summary, knowledge spreads within an interpersonal human relationship. Interaction is critical. Because learning requires interaction, this study adopts a sociological approach to learning and innovativeness.
I n n o v a t i v e n e s s b e t w e e n d e p a r t m e n t s
Innovativeness in contacts between departments just like among individuals has to do with learning. The knowledge outflows and inflows of departments are by definition directly related to learning and hence to their innovativeness.
Different departments are likely to have different backgrounds. The differences may relate to e.g. cultural characteristics or professional qualities. This heterogeneity is prerequisite for learning, as well as a major cause of relational difficulties. Therefore, what has to be achieved foremost is that people take advantage of different strengths. This leveraging of each others qualities is a first step to innovative interaction. The explicit need to do so is addressed as a collective orientation.
A commonly adopted form for this pursuit is the cross-disciplinary team. A group of people with different backgrounds share a task or a mission in order to converge different perspectives into some solution.
Another increasingly frequently applied approach to interdepartmental learning are communities of practice. Wenger (e.g. e.a. 2000) defines these as groups of people informally bound together by shared expertise and a passion for a joint enterprise. He declares that communities of practice help drive strategy, develop new businesses, solve problems quickly, transfer best practices, develop
professional skills, and help the company retain and recruit talent (Wenger, 2000). So, various forms of innovativeness can occur through communities of practice.
I n n o v a t i v e n e t w o r k s
Innovativeness relates to interaction. Therefore, authors agree that for the innovative outcome it matters what structure of contacts a focal person is in. They disagree about what structure is most advantageous. The debate is mainly about the question whether it is favourable to be in an open or in a dense network. Innovativeness is particular interaction, therefore on the network level the question is what pattern of interaction is most effective. In an open network most actors have different contacts and many contacts are heterogeneous by nature. Open networks are addressed as entrepreneurial ones as well. Dense networks are the opposite, where a group of actors particularly maintains internal relationships. Dense networks are therefore relatively isolated from outsiders.
A dense network is one in which many relations among the actors occur relative to the number of actors that do not have a relationship. Dense networks allow for easy sharing of information because every actor can approach multiple others. Coleman (1988) reasons that high densities facilitate the smooth flows of information. As information diffusion is a prerequisite for information combination and hence for innovation, Coleman’s argument says that density supports innovativeness.
Moreover, Coleman reasons that network closure increases trust levels. The argument sounds that in close networks reputations matter and network members will adhere to groups norms, which makes trusting them less risky.
Burt (2000) is strongly opposed to that view. All his evidence is explained in favour of brokerage. He confirms the view defended by Granovetter (e.g 2005). Both found that weak ties between groups were most favourable for innovativeness. Forming a bridge between otherwise separated or weakly connected network parts enables economic advantages or innovations. Granovetter even suggested that economic outcomes, in particular market efficiency, do not occur when resources are available to separated networks. In line with these thoughts Burt (2000) distinguishes between entrepreneurial networks and cliques. The latter are characterised by close networks while the entrepreneurial ones link into many different groups. The activity of brokerage means to stay on a position which spans across social boundaries. In this study it is therefore addressed as boundary spanning.
Burt (e.g. 2000) found that density negatively affects performance. Boundary spanning positions, linking weakly connected or otherwise separated groups, are key for performance and innovativeness.
H O W D O E S I N N O V A T I V E N E S S O C C U R ?
Knowledge creation goes along with knowledge transfer, which requires heterogeneous knowledge bases. Therefore, different people need to come together which they will only do in case of a mutually perceived advantage. This thesis therefore focuses on innovativeness and a collective orientation.
I N N O V A T I V E N E S S I N S O C I A L N E T W O R K S W h a t c h a r a c t e r i s e s i n n o v a t i v e i n t e r p e r s o n a l
r e l a t i o n s h i p s ?
This paragraph will describe how individuals can settle for innovative positions. The explanations will follow the modes of learning mentioned above. Therefore, it is consistent with the statement of Wenger (e.g. 2000) that foremost the way we think about learning should change from the traditional view to a perception that regards learning as part of daily life.
Firstly, socialization has significant impact on performance. Many studies confirm that the longer people have worked together, the less need for coordination remains. That is explained by the development of shared mental models (SMM). Salas (2004) clarifies such a model influences both what team members perceive in their operating environments and how recognized cues are reacted upon. Essentially, people operating from a shared mental model have a common conceptual framework, which enables them to perceive, interpret, and respond to dynamic environments in a synchronized, adaptive fashion. The SMMs ease mutually adaptive behaviour and support a common understanding of the pursued objectives. (Baker and Salas, 1997, Salas e.a., 2004, Tjosvold e.a., 2004) As SMMs ease the execution of processes (in which multiple individuals participate), the development of SMMs probably fosters innovation.
Social adaptation comes through experience. Working together reconciles people. Several studies (e.g. Baker and Salas, 1997, Edmondson e.a., 2001, Reagans e.a., 2005) confirm that people mutually adapt with colleagues. The one way to learn how to cooperate with particular persons is by joint experience. An important factor in this category is meta-knowledge. Knowing ‘who knows what’ has a lot to do with what one comes to know. (Gebert e.a., 2006, Reagans e.a., 2005, Rizova, 2005)
Consequently, shared experience and shared mental models ease mutual learning. Hence, it is hypothesised that people acquire knowledge easiest from their acquaintances, with whom they develop relationships over time.
Striving after innovativeness and hence after people with heterogeneous knowledge bases leveraging each other’s experience, the homophily principle should be considered. This principle says that similarity breeds connection. When contacts naturally evolve, people sharing sex, religion, age, profession tend to form relationships. The same holds for vicinity: people near to one another are more likely to develop relationships. So, people in the same town or people in the same organisation will meet more frequently. Moreover, people who are more structurally similar to one another are more likely to have issue-related interpersonal communication and to attend to each other’s issue positions, which, in turn, leads them to have more influence over one another. (Burt, 1980, Marsden and Friedkin, 1993, McPherson e.a., 2001) Feld (1982) contributes to this observation that the social structuring of activities tend to bring similar people into frequent contact with one another, and thereby encourages the development of relationships among them. All this into consideration, innovativeness is not likely to come out of naturally developing contacts which bring similar people together rather than heterogeneous people. Pursuing innovativeness on the network level, the structuring Feld (1982) noted should be reversed by providing for activities where people without common backgrounds meet.
Additional developments are found in research on diversity in teams (Bantel and Jackson, 1989), which suggest that longer tenure might be associated with increasing homogeneity and consequent deleterious effects on team innovation. The second hypothesis reflects this need for a balance between social adaptation and heterogeneity.
Hypothesis I. Innovative contacts occur more frequently within a homogeneous group than between groups.
Hypothesis II. The association between tenure and innovativeness is inversely U-shaped.
Secondly, combination requires (at least) two different knowledge bases to be combined. Learning through information sharing only makes sense if knowledge of two persons is not fully redundant. Therefore, information inequality allows learning. The more access to different knowledge bases one has, the more innovative one is expected to be. Burt (2004) shows that people who broker information among groups are more innovative than others. Therefore, what matters is to be on many lines of communication, to access many flows of information.
Hypothesis III. Access to different sources of information enhances innovativeness.
Learning as combination as well as information sharing with people with different knowledge basis is deemed more complicated than just contacting someone with particular understanding of matters. It is of utmost importance that people involved in innovative relationships distinguish between task-related discussions and personal conflicts. The former are necessary, the latter are devastating. People need a collective orientation to perceive they do not need to compete against ideas of others. A collective orientation means one perceives relationships as collaborative rather than conflictive.
To come from initial heterogeneity to knowledge combination sound debate is necessary. (Ellis e.a., 2003, Tjosvold e.a., 2004, Van der Vegt and Bunderson, 2005) This discussion should be task-related, as opposed to personally oriented. (Gebert e.a., 2006) Dialectics lead from differences to mutual teaching and learning. (Nonaka, 1994)
Several related tensions are involved. Because heterogeneity is almost synonymous to differences, it can lead to barriers in communication. (Gebert e.a., 2006, Gibson and Vermeulen, 2003, Tjosvold e.a., 2004, Van der Vegt and Bunderson, 2005) How can these barriers of heterogeneity be effectively overcome?
People that feel personally offended are likely to backslide and not contribute as they would. With this respect it is assessed whether focal relationships are perceived cooperative or conflictive. That is to say someone perceives that both the counterpart in the relationship as well as himself (/ herself) can achieve success. In conflictive relationships success of the other is perceived disadvantageous to one’s own performance. This perception is theorised to strongly influence information sharing, learning behaviour and hence innovativeness.
Moreover, leaders can frame organizational innovation as a challenge to motivate people for learning. (Yeh e.a., 2006) Besides telling employees to cooperate, leaders can establish win-win situations by setting goals. (Edmondson e.a., 2001, Gebert e.a., 2006, Tjosvold e.a., 2004)
I N N O V A T I V E N E S S I N S O C I A L N E T W O R K S Hypothesis IV. Cooperativeness1 enhances innovativeness.
Hypothesis V. Conflict hinders innovativeness.
Thirdly, application is necessary to settle some abstract insight into one’s mind. Action is key regarding internalization. Co-performance is a way of learning. (Reagans e.a., 2005) The degree to which teams learn by doing can differ spectacularly. Factors that are found to stimulate learning by doing are strongly related to those found to enhance information processing. In summary, internalization is ameliorated by psychological comfort , and past cooperation. (Pisano, 1994, Edmondson e.a., 2001, Reagans e.a., 2005) The underlying rationale is that a certain degree of psychological comfort is necessary to propose ideas for adjustment of current practices and procedures.
Hypothesis VI. Information processing relationships are prerequisite for innovative relationships.
Nonaka (1994), unlike most other authors, addresses externalization as a way of learning. He argues that creative dialogues can articulate tacit knowledge. Preliminary investigations found that among the sample no effort was spent in this direction. As a result, this study does not involve learning by transformation of tacit knowledge into explicit knowledge.
In summary, innovation is a process in which active development of new knowledge is pivotal. Only humans can participate in knowledge generation. Accordingly, innovation is essentially a characteristic of a human relationship. Contacts can differ in the extent of innovativeness.
Innovativeness follows from knowledge creation. In order to teach someone, he or she ought to possess a different knowledge base. A first prerequisite for innovativeness, therefore, is to have heterogeneous relationships. To learn within a relationship, both contacts on the one hand should be acquainted with one another and should understand one another, and on the other hand both should be dissimilar. The consequences of this heterogeneity can be actively overcome by organising for collaboration to enhance innovativeness.
T h e o c c u r r e n c e o f i n n o v a t i v e i n t e r d e p a r t m e n t a l r e l a t i o n s h i p s
Having described what makes a relationship between two individuals innovative, this section will turn to the interdepartmental level. Above, moreover, it was depicted what characterises an innovative relationship on that level. The current part will deal with causes and answer the question how innovative interdepartmental relationships can be promoted based on literature.
1 By cooperativeness we understand perceived reward structures allowing for substitutability of action, mutual reward, and positive
cathexis of others and their actions. That is, an action by one individual not only facilitates the attainment of reward by the actor, but promotes reward attainment for other group members as well. (Rosenbaum, e.a., 1980)
The starting point of this argument is that people with different backgrounds meet with a shared task to achieve. This may take place among some multi-disciplinary team, in regular daily routines or
otherwise. Communication between departments is always performed by individuals.
E.g. Gebert (e.a. 2006) mentions that when people take advantage of different backgrounds and subsequent different strengths several difficulties need to be overcome. These challenges relate to the probability of personal conflicts in the pursuit of task-related debates. Several positively intermediating variables will in this thesis be addressed as a collective orientation. For innovative intergroup contacts it is hypothesised prerequisite to adopt a collective orientation. This is confirmed by Tjosvold (e.a. 2004) who claims to be the first linking the theory of collaboration and competition to new product development team performance. His study observed a positive association between cooperative goal perception of team members and the team outcome.
As this association has never been found investigated on another level than among team members, the current thesis will be the first to empirically test whether innovativeness in relations between departments is positively affected by a collective orientation.
B o u n d a r y s p a n n i n g
Just like the above argument reasoned, it is likely that an entity that is exposed to many sources of information is more innovative than one that is not. The same may hold for groups, i.e. departments. If some department has many different contacts, it is expected to be more innovative.
Hypothesis VII. Departments that have many information sharing relationships with other departments are more likely to have developed many innovative relationships.
C o l l e c t i v e o r i e n t a t i o n
Most relevant investigations confirm that for learning to take place it is necessary that individuals submit their own interests to the collective. Therefore, in a contact between departments, the goals of the colleague should be perceived compatible with one’s own goals.
In the fields of behavioural psychology both and game theory (e.g. Gould, 1993) a lot of publications deal with the subject of team performance under co-operative and competitive conditions (e.g. Deutsch,1949, Thompson, 1972). It has been repeatedly confirmed that teams of which team members perceive their goals compatible (i.e. as win-win situations) outperform teams with goals perceived competitive.
The current thesis investigates whether these patterns can be observed among departments as well. Therefore it is hypothesised that a compatible goal perception adds to a relationship’s innovativeness.
Hypothesis VIII. Cooperative goal perception contributes to innovativeness between groups.
The reasoning can be inverted: the perception of incompatible goals negatively affects innovativeness. If people believe their success implies the loss of others, they are not likely to give in. The situation of conflict was proven to lead to declined overall performance because people become more interested in winning and protecting their reputation than in self-examination and development. Our hypothesis addresses innovativeness as final variable.
I N N O V A T I V E N E S S I N S O C I A L N E T W O R K S The reader should note the difference between conflict and dialectics. Conflict means that a
relationship is characterised by a win-lose goal perception. Dialectics, or task conflict, has to do with a discussion in the pursuit of a combination of knowledge and experience. Moreover, conflict
concentrates on a person or a group, whereas dialectics focus on a subject of debate.
Hypothesis IX. Conflict negatively affects innovativeness between groups.
C O N C L U S I O N
This chapter defended that innovativeness concerns learning. Therefore, for innovative interpersonal relationships it is necessary to have heterogeneous relationships, that means relationships between individuals that do not share backgrounds. Several difficulties are likely to arise in subsequent situations. These can be overcome by providing for a collective orientation, which implies on the relational level a cooperative relationship.
The academic contribution of this study is that claims that have been tested on within teams, will be tested on the level of intergroup contacts. This investigation is among the first to test whether collaborative relationships between groups are advantageous for innovativeness.
M
E
T
H
O
D
S
The structure of this chapter follows the hypotheses of the previous one. For each hypothesis it is explained how the analysis will take place. For most readers the final table summarising the section will do.
I N T E R V I E W S A N D S A M P L E
Data was collected through 57 oral interviews among employees of particular departments and business units of one company. This manner of data collection guaranteed high response rates compared to e.g. questionnaires. Interviewees were guaranteed anonymity concerning potentially sensitive answers and were promised access to the final report.
The participating interviewees were selected according to their membership of certain departments that were initially deemed of utmost relevance for knowledge transition. Preliminary investigations made clear that these were the two R&D departments of the company, and the various sales units because these two sorts of business functions are theoretically mutually dependent for innovativeness. That is to say, R&D requires insight in clients and sales representatives need understanding of
possible product features and ideally both leverage each others knowledge bases. The investigation was extended to the sales support which was identified as a potential knowledge base, and to the management team which was expected to fulfil central positions. Moreover, during the data collection the study was broadened to the production planners because they were rather frequently mentioned by other interviewees. The major parts of the particular company that were not involved in the study are the manufacturing operators, purchasing, and other supportive departments. These were assumed to contribute less significantly to the firm’s innovative power. Thus, this study comprises the groups pivotal for innovation.
I N N O V A T I V E N E T W O R K
The literature study of this thesis defined innovativeness and defended that distinctive forms of learning are related. Each of these forms occurs exclusively in human relationships. They are respectively socialization, combination, internalization (and articulation). These modes of learning are following Nonaka (1994) translated into regular day-to-day activities. Interviewees were asked for the occurrence of the regular behaviour. In order to depict all innovative relationships, hence an innovative network, six questions were asked:
- With whom do you regularly solve problems?
- Who regularly asks you a challenging question? Can you give a top five? - With whom do you discuss your work?
- With whom do you together carry out tasks? - From whom do you learn things?
- With whom do you together make decisions?
The first question, after problem solving, relates to internalization and combination. When people together solve problems, the first who encountered the problem apparently needs to acquire knowledge and therefore approaches someone whose knowledge then transfers.
I N N O V A T I V E N E S S I N S O C I A L N E T W O R K S The second question, about challenging questions, intends to distinguish from facts. Colleagues may ask for facts, e.g. delivery dates, or for insights. This question aims at examining combination, the discussion of explicit knowledge.
The third question, with whom do you discuss your work, strives after both the transfer of tacit and the transfer of explicit knowledge. Discussing work means colleagues debating what to do. Both are assumed to contribute their experiences and knowledge.
Joint execution of tasks, the fourth question, is about socialization. Learning by imitation is asked for this way.
The fifth question stresses learning in the traditional sense of the word. One may think of formal training sessions etcetera.
The last question, about joint decision making, does just like discussing work, accent the transfer of tacit knowledge. It is unlikely that in a discussion about work someone will agree with a solution that does not confirm his image of the work. Therefore, work related discussions are very likely to surface tacit knowledge.
Summarizing, these questions show again that innovativeness primarily occurs within human relationships. These questions address all possible forms of knowledge transition and therefore adequately cover the notion of innovativeness in this study.
As degrees of innovativeness two measures will be used. The first is the network position of the individual in the innovative network. For the innovative network the degree centralities are calculated. This calculation yields a centrality value which is considered a degree that shows how many
innovative relationships one has developed. The more central one is in the network, the more innovative relationships that person has. Thus, the network positions are deemed a degree of innovativeness of individuals.
The second measure of innovativeness is the best idea someone has. All participants will be prompted ‘what is your most excellent idea for [your company]?’ This will supposedly show where good ideas begin and what individuals are actively developing ideas and by doing so contributing to the innovativeness of their company. These ideas will be ranked by two experts. As the subject is
innovation, one expert will be chosen because of proficiency with technical innovation, another one will be elected because of proficiency with marketing. The resulting scores intend to assess
innovativeness of individuals.
H y p o t h e s i s I . I n n o v a t i v e c o n t a c t s o c c u r m o r e f r e q u e n t l y w i t h i n a h o m o g e n e o u s g r o u p t h a n b e t w e e n g r o u p s .
To test the first hypothesis the notion of innovativeness will be used as described above and will be applied as an innovative network. Like all quantitative analyses in network analyses it should be reckoned with that data is not independent. (I.e. if Alpha informs Bravo and Charlie, Charlie may know Bravo and may learn from Alpha.) While lacking independent observations, statistical significance is properly assessed using many (e.g. 1000 or more) trials with random permutations.
The hypothesis needs an operationalisation of homogeneous groups. This investigation assumes that people who share professional backgrounds, and who fulfil similar jobs, and who live in the same country are homogeneous. As the study is carried out among an international firm that was functionally organised, i.e. each department held one organisational function, the hypothesis relates to contacts within departments and between departments.
The UCInet programme executes an ANOVA algorithm for the hypothesis that all groups may have a preference for within-group ties, but that the strength of the preference is the same within all groups.
H y p o t h e s i s I I . T h e a s s o c i a t i o n b e t w e e n t e n u r e a n d i n n o v a t i v e n e s s i s i n v e r s e l y U - s h a p e d .
The second hypothesis concerns the characteristics of nodes rather than relations. Two attributes are compared. First is tenure. Three sorts of tenure are known, viz. job tenure, group tenure, and
organisation tenure. For every participant in the investigations it is known since when he or she has fulfilled his / her current job. Job tenure has to do with the answer on the question: for how long have you fulfilled your current job? Group tenure similarly relates to the answer on: for how long have you been member of your current department? For how long somebody has worked for the particular company forms organisation tenure.
These three measures of tenure are set off against the two measures of innovativeness (as described above), namely the network position and the idea score.
With three variables of tenure (viz. job tenure, group tenure and organisation tenure) and two variables of innovativeness (viz. degree centrality and idea score) six combinations are put into regression analyses.
The regression coefficient will tell to what extent a quadratic association explains the association between the constructs. It is expected that tenure will predict innovativeness.
H y p o t h e s i s I I I . A c c e s s t o d i f f e r e n t s o u r c e s o f i n f o r m a t i o n e n h a n c e s i n n o v a t i v e n e s s
The third hypothesis compares two networks. A non-innovative network is defined as an information sharing network and the innovative network is conceived of as described above. Whether someone has access to different sources of information means, put in terms of social networks, whether someone has a high betweenness centrality. Betweenness centrality measures whether someone is upon many flows of information. In even other words, betweenness centrality concerns the situation where someone bridges between groups of information and forms a link in a chain. This study operationalises boundary spanning as betweenness centrality.
This betweenness centrality of information sharing will be set off against degree centrality in the innovative network.
I N N O V A T I V E N E S S I N S O C I A L N E T W O R K S H y p o t h e s i s I V . C o o p e r a t i v e n e s s e n h a n c e s
i n n o v a t i v e n e s s .
The fourth hypothesis aims to assess whether a compatible goal perception supports innovativeness. Therefore, two networks will be compared, viz. the cooperative one and the innovative one. Network positions of individuals both and relationships in both the two networks are assumed to show a high degree of resemblance.
As the literature study described, cooperativeness regards smooth collaboration, goal congruence, and task substitutability. This will be put in a social network. Questions that will be asked to assess this construct are:
- With whom do you smoothly work together? Can you give a top five? - What people positively affect your performance most significantly? - Who should perform well for you to perform well?
- Who will not perform well if you do not?
- Whose tasks would you complete if he (/she) appeared unable to do so?
- Who would most probably do your work if you were unable to complete your tasks?
To test whether relationships occur in both networks the Quadratic Assignment Procedure (QAP) will be applied. The algorithm takes into account that both the columns and the rows of any matrix never are independent. Relations in a real-life network are never random, but are always to more or less extend clustered.
If few relations will occur in both networks, saying many relations exist in either of both networks, the outcome of the QAP would be low, which would reject the hypothesis.
H y p o t h e s i s V . C o n f l i c t h i n d e r s i n n o v a t i v e n e s s .
The fifth one is the rival hypothesis of the fourth. It strives after testing whether non-cooperativeness, i.e. conflict, negatively affects innovativeness. Conflict will measure a non-general orientation: conflict means aggressiveness or defensiveness to favour one’s own interests rather than the totality. Conflictive relationships will be depicted according to the next questions:
- Could you tell me, who is more influential than he (/she) should be? - For you to become more successful, what circumstances must change? - Who does not smoothly work together with you?
- Who should do his job differently?
The hypothesis implies that when a relationship is characterised by conflict, it is unlikely to develop into an innovative one. Therefore, both networks will – if the hypothesis is true – hardly associate. The outcome of a QAP will be low. Note that the correlation can not be negative, since to conflict as well as to innovate a relation needs to exist and people need to know each other.
Based upon the theoretical reasoning provided for in the previous chapter, the innovativeness is deemed dependent on the amount of conflict in relationships rather than vice versa.
H y p o t h e s i s V I . I n f o r m a t i o n p r o c e s s i n g r e l a t i o n s h i p s a r e p r e r e q u i s i t e f o r i n n o v a t i v e r e l a t i o n s h i p s .
Hypothesis number six assumes a relationship needs to be an information sharing one to develop into an innovative one. Therefore the information sharing network and the innovative network are
compared in two forms.
A QAP will be performed. This will show whether a high association exists between both networks. A weak link will be interpreted as saying that information sharing is not prerequisite for innovativeness.
It should be remarked that it cannot be fully excluded that a certain amount of redundancy in the measurement may affect outcomes. Even though the data collection made a clear distinction between sharing information about facts and innovative behaviour, it is recognised that innovativeness contains some transferring of facts.
M e t h o d s c o n c e r n i n g i n d i v i d u a l r e l a t i o n s h i p s
Hypothesis Data Method
Hypothesis I - Innovative network
- Departments
- Density table - ANOVA
Hypothesis II - Job tenure
- Group tenure - Organisation tenure - Innovative network
- Regression analyses
Hypothesis III - Information sharing network - Innovative network
- Linear regression analysis
Hypothesis IV - Cooperative network
- Innovative network
- Regression QAP
Hypothesis V - Conflict network
- Innovative network
- Regression QAP Hypothesis VI - Information sharing network
- Innovative network
- Regression QAP
I N T E R G R O U P R E L A T I O N S H I P S
All following hypothesis can not be tested by means of statistical analyses. The major difficulty to overcome concerning the analysis is the low number of nine departments in the study. It will not be possible to draw sound conclusions based on statistics calculating relations between variables in this small a sample.
Therefore, a qualitative analysis is required and case based reasoning will lead to conclusions. Through the technique of pattern matching (see: Yin, 2003, pp.116-119) sound conclusions will be arrived at. The technique can be summarised as an explicit and precise description of an expected pattern, like the hypothesis, and the subsequent empirical verification. If reality is consistent with the expectation, theory does probably accurately describe the reality.
I N N O V A T I V E N E S S I N S O C I A L N E T W O R K S As cases the ego networks will do. That is to say each department and it’s direct relations will be studied for evidence verifying or contradicting the literature study. The counterargument that experimental logic does not reveal causal associations is dealt with because the predicted patterns strengthen explanations of the cases. It will be possible to accept or reject the hypothesis because all relevant data will be taken into consideration. Usage of both observations in favour and those against the pattern will guarantee for scientific, i.e. thorough, research practice.
Hypotheses equivalent to the above concerning relationships of individuals capture the patterns to match.
- Hypothesis VII. Departments that have many information sharing relationships with other departments are more likely to have developed many innovative relationships.
- Hypothesis VIII. Cooperative goal perception contributes to innovativeness between groups. - Hypothesis IX. Conflict negatively affects innovativeness between groups.
For the seventh hypothesis it will be necessary to distinguish between two forms of communication in order to prevent for a circular reasoning. It is not said that a department that has many relationships is likely to be central in the network, which is a measure of the number of relationships. It is said that a department which has many relationships characterised by information sharing is both attractive to others to develop innovative relationships with and develops innovative relationships itself.
The hypothesis compares degree centrality in the information sharing network of departments against degree centrality in the innovative network of departments.
The eight hypothesis reflects the fourth on the abstraction level of intergroup communication.
The ninth hypothesis reflects the fifth on the level of departments. The conclusions will be drawn through the same sort of logic as applied for the previous hypothesis, viz. through the technique of pattern matching. What is challenging, though, is that individuals have conflictive relationships (or not) and two departments can have both conflictive and cooperative relationships simultaneously. This relational ambiguity will be used as an opportunity for analysis to distinguish between fully conflictive relationships and partially conflictive relationships.
C O N C L U S I O N
All in all, data collection and following analysis enables to reveal several distinctive relationships among the sample networks consisting of 57 individuals as well as associations between the various sorts of relationships, and between certain characteristics of the individuals and the structure of their contacts.
R
E
S
U
L
T
S
A
N
D
I
N
T
E
R
P
R
E
T
A
T
I
O
N
S
This section first provides with a table of results of quantitative analyses and subsequently dedicates some room to coupled interpretations.
R E S U L T S O F Q U A N T I T A T I V E A N A L Y S E S Hypothesis I R Squared 0.278 * Intercept 0.110 B 0.694 * Hypothesis II R Squared 0.133 * F 4.131 * B 0.486 * t 2.798 *
Hypothesis III R Squared 0.262 *
F 19.563 * B 0.015 * Intercept 9.55 Hypothesis IV R Squared 0.42 * Intercept 0.073 * B 0.706 *
Hypothesis V Hypothesis was not accepted.
Hypothesis VI Hypothesis was not accepted.
* p =< 0.05
H Y P O T H E S I S I
Overall, a tension to homophily was observed. It accounted for 27.8% of the outcomes. If two random employees were in the same department, the probability they had an innovative relationship equalled 69%. For those in different departments the probability of having a relationships equalled 11%.
H Y P O T H E S I S I I
Seeking for a curve of best fit by the method of the least squares the R Squared was calculated. The Current Function of somebody set off against Degree Centrality in the innovative network led to an R Squared value of 0.062. Hence, the best fitting quadratic curve explains about 6% of the innovative network positions by the time one holds his or her job. The F value of 1.788 (p=0.177) confirms degree centrality can not be attributed to the job tenure.
The job tenure appeared not to influence someone’s idea score. The R Squared value equalled 0.045. Regression coefficients were not found significant.
Group tenure according to the R Squared value accounts for 13.3% of the degree centrality in the innovative network. The Anova resulted in an F value of 4.131 (p=0.021). Hence, the variance in how
I N N O V A T I V E N E S S I N S O C I A L N E T W O R K S long someone had been member of the department quite firmly affects the variance of someone’s degree centrality in the innovative network. Moreover, the regression coefficient B equalled 0.486 (p=0.007). (As a comparison, the linear equation that would best describe the association resulted in an R Squared value of 4.3%.)
Considering the above, a quadratic association appeared to explain the relation from group tenure on degree centrality of individuals in the innovative network. This is one result pointing to acceptance of the hypothesis.
The R Squared values of 0.009 means that group tenure accounts for 0.9% of the variance in idea scores. Other associated regression coefficients are not significant.
Organisation tenure accounted for 7.9% of the variance in degree centrality in the innovative network. (R Square = 0.079) The F value was not significant (p=0.107). Therefore, this particular tenure does not significantly affect the innovative network positions.
Idea scores set off against organisation tenure were not found significant.
Taking all the arguments into consideration, group tenure appeared to account for the degree centrality in the innovative network by a quadratic association. The hypothesis can be accepted.
Accepting the hypothesis says that increase of group tenure first, for some time, enhances
innovativeness, while then, after some time, declines innovativeness. Next question rises: what is the optimum? The optimum of the equation appeared to be at about 14 years and a degree centrality of about 8. This says certain employees have been member of their departments for decades, and have only a few innovative contacts. This says as well that certain employees have not yet been member of their department for a long time, though they have developed an ego network with several innovative relationships.
H Y P O T H E S I S I I I
The third hypothesis measured the association between betweenness centrality in the information sharing network and innovativeness, operationalised again as degree centrality in the innovative network. A linear relationship from betweenness centrality in information sharing on innovativeness was expected beforehand.
The R Squared equalling 26.2% told the model accounts noteworthy for the outcomes. The same actors who access many flows of information are central in the innovative network. This is confirmed by the F value of 19.56.
Based on these results, the linear association from betweenness centrality in information sharing upon degree centrality in innovativeness appeared to best predict the outcomes. The hypothesis was accepted. This proves the basic assumption of this study, viz. that exposure to heterogeneous inputs of information makes innovative.
H Y P O T H E S I S I V
A QAP analysis with the full partialling method was run with the cooperative network as the
independent variable and the innovative network as the dependent variable. The outcome was an R square of 0.42, saying that knowing whether some couple has a cooperative relationship reduces the uncertainty in predicting an innovative tie by 42%. The intercept equalling 0.073 tells that when two persons do not have a cooperative relationship, the probability that either of both has an innovative relationship with the other is 7.3%. The other way around, if two persons have a cooperative relationship, this increases the probability of an innovative relationship with 70.6%.
The hypothesis was therefore accepted.
H Y P O T H E S I S V
The conflict network was used as independent network to answer its impact on the innovative one. The R square value of 0.037 tells that the occurrence of conflictive contacts reduces uncertainty in predicting innovative relationships by 3.7%. The intercept of 0.15 says that if two persons do not have a conflictive relationship, the probability the couple has an innovative relationship is 15%. The regression coefficient equalled 0.36, saying that a conflictive relationship increases the probability of the occurrence of an innovative one by 36%.
The hypothesis was therefore not accepted. Even though it can not be defended that conflict hinders innovativeness, conflict may be a factor that does not stimulate.
H Y P O T H E S I S V I
Another QAP analysis was performed. The innovative network was chosen as dependent on the information sharing one. The resulting R square was 0.414, meaning that knowledge of information sharing relationships reduces uncertainty of innovative relationships by 41.4%. The intercept equalled 0.061, which tells that if some relationship is non-existent in terms of information sharing, the
probability that the particular relationship is existent in terms of innovativeness is increased by 6.1%. The regression coefficient of 0.64 meaning that an information sharing relationship increases the probability of an innovative relationship by 64% was found not significant.
The hypothesis was therefore not accepted. The observations may have occurred by chance.
I N T E R G R O U P I N N O V A T I V E N E S S
As the literature study made clear, concerning innovative relationships among groups several debates are yet to be finished. Therefore, the observations from this study may contribute through empirical results and their interpretations. Remembering from the literature study, these debates are the following questions. Is it that open or dense networks favour learning most strongly? Are positions upon many lines of communications helpful for innovativeness when it comes to groups? Are information processing relationships prerequisite for innovative relationships? Does a collective orientation support innovativeness?
I N N O V A T I V E N E S S I N S O C I A L N E T W O R K S Each of these issues has not yet been explained to their fullest extend. Therefore, this study will use the available data for interpretations either accepting or rejecting the theory as it was described in the above literature report. Some interviewees are more difficult to attribute to a department than others, e.g. the managing directors, and of some departments only one key person was in the sample. That's why it was impossible to report the innovative contribution of their departments. Therefore, those were left out of the following analysis.
The texts are structured according to the networks of relationships the various departments had, and the information is summarised in the table.
N E T W O R K C O N F I G U R A T I O N
The discussion on network configuration is about whether open or dense networks are most effective for innovation. It roughly says that either an open network is best because of a high variety of inputs and related creativity, or a dense network is best because of social adherence and related
consequences of trustworthiness of network members.
Firstly considering the network of the English sales department, genuine innovations had occurred. A nice example was the idea of two sales representatives for a low temperature casing for fan coils to make those safely applied in e.g. schools. Proposed to the chief engineer it was adopted and released for production. It is being sold off, currently.
The formal organisation structure states that sales area managers form a department with internal sales officers, all of whom report to the managing director. Besides, a factory and an engineering department are the responsibility of the operations manager, who reports to the managing director.
The innovative network seems rather open. Sales representatives (as a group) have innovative contacts with the operations manager and with the chief engineer, who teaches technical solutions. On the other hand, these contacts can better be understood as a dense network including the sales representatives and their back office, the managing director, the chief engineer and the operations manager. This rather dense network has led to genuine innovations. According to the theory, major clues are the density of the network and the heterogeneity of the network members.
Secondly considering the Dutch sales department and its relationships, it is expected to resemble the UK situation because of the vicinity of engineers and another factory. The network structures of the Dutch department and the English differ significantly concerning the current issue of open or dense networks. The Dutch sales director, to whom all representatives report, performs most
interdepartmental contacts of his department. An illustrative example is that a client may ask for a solution in a particular off standard context. The sales representative discusses the challenge with his (/her) manager because of his experience and his formal authority. Then the manager eventually solves the matter with an engineer. In many occurrences, this practice prevents the sales
representatives contacting anybody but their direct colleagues. The colleagues primarily consult each other for solutions.
