ERIM Research Clinic: Strategic Renewal and Innovation: Does management research matter?

How do large multiunit firms renew?  How do they promote order and control among their different units, while having to respond and learn? These tensions have been variously described in the organization literature as change versus preservation (cf. Poole & Van de Ven, 1989; Volberda 1996), adaptation versus selection (cf. Baum, 1996; Volberda and Lewin, 2003) and exploration versus exploitation (cf. March, 1991; Levinthal & March, 1993). Examined less frequently is how multiunit firms deal with these tensions over time. Although simulations (Levinthal, 1997; March, 1991) suggest that the optimal path for the firm is one of balanced exploitation and exploration, theories on processes of renewal are still limited. Moreover, most of them focus on the interaction between the firm and the environment and ignore the interactions at the intra-firm level (micro-foundations). In this session, we investigate journeys of strategic renewal of multiunit firms considering how and why processes of exploration and/or expERIloitation unfold. In doing so, we want to provide answers to the following questions: When is renewal a selection or an adaptation process? Are there generic patterns of renewal or is each renewal journey rather idiosyncratic? And what roles do managers at the corporate and unit level play in renewal journeys?

Readings

• Volberda, H.W., Foss, N. J. & Lyles, A. (2010), Absorbing the Concept of Absorptive Capacity : How to Realize its Potential in the Organization Field, Organization Science, 21(4): 931-951.
• Volberda, H.W., Jansen, J.J.J., Lima, B. & Van den Bosch, F.A.J., How Absorptive Capacity drives Exploratory Innovation: The moderating effects of relocating core functions and their governance mode, Working Paper.

Assignments

• Please read the Perspective Paper in Organization Science on Absorptive Capacity. The paper shows that the AC construct is still surrounded by considerable ambiguity with respect to its meaning and nature; the domains in which it exists; and its implications and antecedents, including its micro-foundations in individual action and interaction.

On the basis of  Figure 7 (p. 944) in which an integrated framework of absorptive capacity is presented and the major research gaps are visualized, choose at least one research gap and describe how you would solve this.

• Please read the Working paper “How Absorptive Capacity drives Exploratory Innovation: The moderating effects of relocating core functions and their governance mode.”  Please analyze the major shortcomings of this paper and provide suggestions for improvement.

Contact information:
Miho Iizuka
Email