Cognition and Innovation
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New Horizons in Managerial and
Organizational Cognition
Cognition and Innovation
Edited by
Kristian J. Sund
Roskilde University, Denmark
Robert J. Galavan
Maynooth University, Ireland
Stefano Brusoni
ETH Zürich, Switzerland
United Kingdom – North America – Japan
India – Malaysia – China
Emerald Publishing Limited
Howard House, Wagon Lane, Bingley BD16 1WA, UK
First edition 2018
Copyright © 2018 Emerald Publishing Limited
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British Library Cataloguing in Publication Data
A catalogue record for this book is available from the British Library
ISBN: 978-1-78769-432-3 (Print)
ISBN: 978-1-78769-431-6 (Online)
ISBN: 978-1-78769-433-0 (Epub)
Contents
List of Contributors
CHAPTER 1
vii
COGNITION AND INNOVATION: A
FRAMEWORK AND INVITATION TO EXPLORE
Kristian J. Sund, Robert J. Galavan and
Stefano Brusoni
CHAPTER 2
THE PERFORMATIVE POWER OF WORDS:
HOW BUSINESS MODEL INNOVATORS USE
FRAMING FOR STRATEGIC ADVANTAGE
Yuliya Snihur, Llewellyn D. W. Thomas and
Robert A. Burgelman
CHAPTER 3
71
COGNITIVE PROCESSES OF
ENTREPRENEURIAL OPPORTUNITY
IDENTIFICATION: TOWARD
A HOLISTIC UNDERSTANDING OF
THE MICRO-MECHANISMS
Zorica Zagorac-Uremovic´ and Christian Marxt
CHAPTER 6
45
THE RELATIONSHIP BETWEEN DEMAND–
PULL ATTENTION AND RADICAL PRODUCT
INNOVATION: EVIDENCE THROUGH
COMPUTER-AIDED TEXT ANALYSIS
Esther Biehl, Kerstin Fehre and Marco Tietze
CHAPTER 5
13
A SOCIO-COGNITIVE MODEL OF
INNOVATION ADOPTION AND
IMPLEMENTATION
Tabish Zaman, Matthew Mount, Tyrone S. Pitsis,
Rory O’Connor and Stephen Dean
CHAPTER 4
1
95
THE ROLE OF POWER ASYMMETRY AND
PARADOXICAL LEADERSHIP IN SOFTWARE
DEVELOPMENT TEAM AGILITY
Constantinos S. Mammassis and Petra C. Schmid
125
v
vi
CONTENTS
CHAPTER 7
EXPLORING THE ORGANIZATION
OF UNIVERSITY–INDUSTRY JOINT
LABORATORIES: A LEADERSHIP
PERSPECTIVE
Maral Mahdad, Marcel Bogers, Andrea Piccaluga
and Alberto Di Minin
CHAPTER 8
141
THE MORAL DILEMMA OF CARING
VERSUS RULING: AN EXAMINATION OF
THE ETHICAL TURN IN PRACTICES
Georg von Krogh, Nina Geilinger and
Lise Rechsteiner
175
Author Biographies
209
Index
217
List of Contributors
Esther Biehl
Karlsruhe Institute of Technology (KIT),
Germany
Marcel Bogers
University of Copenhagen, Denmark
Stefano Brusoni
ETH Zürich, Switzerland
Robert A. Burgelman
Stanford University, USA
Stephen Dean
St James’s University Hospital, UK
Kerstin Fehre
Vlerick Business School, Belgium
Robert J. Galavan
National University of Ireland
Maynooth, Ireland
Nina Geilinger
ETH Zürich, Switzerland
Georg von Krogh
ETH Zürich, Switzerland
Maral Mahdad
University of Copenhagen, Denmark
Constantinos S.
Mammassis
ETH Zurich, Switzerland
Christian Marxt
ETH Zurich, Switzerland
Alberto Di Minin
Sant’Anna School of Advanced
Studies, Italy
Matthew Mount
Deakin University, Australia
Rory O’Connor
University of Leeds, UK
Andrea Piccaluga
Sant’Anna School of Advanced
Studies, Italy
Tyrone S. Pitsis
Durham University, UK
Lise Rechsteiner
Propagator Ventures, Norway
Petra C. Schmid
ETH Zürich, Switzerland
Yuliya Snihur
Toulouse Business School, France
Kristian J. Sund
Roskilde University, Denmark
vii
viii
LIST OF CONTRIBUTORS
Llewellyn D. W. Thomas LaSalle Universitat Ramon Lull, Spain
Marco Tietze
Karlsruhe Institute of Technology
(KIT), Germany
Zorica ZagoracUremovic´
ETH Zürich, Switzerland
Tabish Zaman
University of Leeds, UK
CHAPTER
1
Cognition and
Innovation:
A Framework and
Invitation to Explore
Kristian J. Sund, Robert J. Galavan and
Stefano Brusoni
Abstract
In this brief introduction, we reflect on the diversity of studies connecting cognition to innovation and the enormous
potential that exists for further research. Research streams
on cognition in organizations, innovation in organizations,
and intra- and entrepreneurship have developed in parallel
over the past decades, with frequent touchpoints, notably in
terms of theories of cognition informing studies on the processes of innovation and creativity. Cognition theories have
thus been considered as micro-foundations of many theories
of innovation. Here, we outline the many ways that theories
of cognition can yield insights for studies of innovation and
discuss the contributions of chapters comprising this third
volume of New Horizons in Managerial and Organizational
Cognition.
Keywords: Biases; creativity; innovation; managerial and
organizational cognition; micro-foundations; sense making
Cognition and Innovation
New Horizons in Managerial and Organizational Cognition, Volume 3, 1–11
Copyright © 2018 by Emerald Publishing Limited
All rights of reproduction in any form reserved
doi:10.1108/978-1-78769-431-620181001
1
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KRISTIAN J. SUND ET AL.
Advances in the Study of Cognition
The study of cognition in and around organizations has advanced
considerably over the past 30 years. Taking inspiration from earlier studies of social psychology, organizational and management
scholars laid the foundations during the 1980s and into the 1990s
for the modern domain of managerial and organizational cognition (MOC) (Walsh, 1995). What emerged was a new view of strategic decision-making that complemented the dominant industry
and resource-based views. The knowledge-based view (Grant,
1996; Nonaka & Takeuchi, 1995) also emerged around this time,
but where the unit of analysis in this view is knowledge or information, the processes that lead to or interfere with the creation of
knowledge are the realm of MOC studies. The knowledge-based
view paved the way for the study of how innovation emerges and
spreads. Similarly, the cognitive perspective paved the way for the
study of how the individual and shared knowledge structures in
organizations are formed and disseminated, and how decisions
about what and how to innovate are shaped by the way we think
(Glynn, 1996).
The early focus of MOC studies centered on theories of interpretation, according to which managers are “information workers” (McCall & Kaplan, 1985; Sund, 2015), collecting, handling,
and interpreting information from and about the external environment on behalf of the organization (Daft & Weick, 1984),
often under conditions of uncertainty (Huff, Milliken, Hodgkinson, Galavan, & Sund, 2016; Milliken, 1987, 1990; Sund, 2013,
2015). Such information processing is guided by and creates constructs defined as knowledge structures, mental maps, templates
(Walsh, 1995), and schema (Bartunek, 1984). Empirical work in
this tradition has focused on revealing and analyzing subjects’
explicit representations of knowledge, through methods such as
repertory grid analysis, interviews-based taxonomic mapping, and
causal mapping (e.g., Eden & Spender, 1998; Fiol & Huff, 1992;
Hodgkinson & Healey, 2008; Huff, 1990; Walsh, 1995). Common
to such methods is the focus on “conscious” and “cold” cognition
(Hodgkinson & Healey, 2011; Hodgkinson, Sund, & Galavan,
2018), that is, rational thoughts of which we are aware and can
process in the absence of emotion.
Over the past two decades, studies of both hot cognition –
that is, cognition under conditions of high affect – and automatic, unconscious cognition have emerged in organizational
research. These have extended our understanding of the role
Cognition and Innovation
3
of cognition in organizations and decision-making. Informed
by dual-process theory, we now see studies examining how the
aspects of our thinking that we do not entirely control or are
not entirely aware of, influence our decisions (e.g., Chaiken &
Trope, 1999; Epstein, 1994; Kahneman, 2011; Sloman, 1996;
Smith & DeCoster, 2000). Studies of, for example, subconscious goals, implicit attitudes, and implicit affect, and so on
have broadened our understanding of human decision-making
and shown it to be more complicated than we previously imagined (Hodgkinson et al., 2018). New empirical research methods such as those offered by neuroscience (e.g., Massaro, 2018;
Laureiro-Martinez, 2018; Laureiro-Martinez, Brusoni, Canessa,
& Zollo, 2015), or agent-based modeling (e.g., Healey, Bleda,
& Querbes, 2018; Miller, 2015) can now complement more
traditional interview methods (e.g., Vuori, 2018), experimental
methods (e.g., Reypens & Levine, 2018), and survey methods
(e.g., Sund, 2016), in opening up the potential to study emotions and unconscious biases in decision-making, including in
studies of innovation.
Intersections Between Cognition and
Innovation
The study of innovation, that by some has been defined as “a new
idea” (Van de Ven, 1986, p. 591) and by others as “the successful
exploitation of new ideas” (Adams, Bessant, & Phelps, 2006,
p. 22), is in itself not new. The concept of innovation has over
time become ubiquitous and pervasive, to the point that, in various review articles scoping the literature on innovation, the term
has been called a buzzword (Hidalgo & Albors, 2008) and the
body of literature has been criticized for being inconsistent in its
operationalization of key constructs such as the degree of innovation (Garcia & Calantone, 2002). Such criticism notwithstanding,
there are today some widely accepted categories of innovation
that can help us structure the field, and contextualize findings.
The most typical ones are degree of innovation, type of innovation, level of analysis, and process stage.
While there has been some debate about how to clearly
differentiate between degrees of innovation, innovations are
commonly categorized as either incremental or radical, or somewhere in between. It is also understood that novelty can be new
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KRISTIAN J. SUND ET AL.
to the firm, new to the industry, or new to the world (Ahuja &
Morris Lampert, 2001). How such newness, or innovativeness,
is conceived and measured varies enormously across studies.
Christensen’s (1997) related categorization of sustaining versus
disruptive innovation has regained interest recently, thanks to
a mass media and industry focus on digitalization trends. The
second very common categorization concerns innovation type,
where typical categories include product, service, process, technical/technological, administrative, or business model innovation.
The third and fourth categorizations can be thought of as the
level of analysis, typically categorized as individual level, team
level, organizational level, or industry level, and in the many
studies looking at innovation as a process, the actual stage in
this process, for example, initiation stage, idea generation stage,
adoption stage, or implementation stage (Gopalakrishnan &
Damanpour, 1997).
Closer to the aims of this volume, the interplay of cognition
and innovation has been at the center of a long and distinguished
tradition at the interface between behavioral and social analyses,
not least since the landmark work of March and Simon (1958).
They managed to seamlessly interweave the social and behavioral
elements of cognition, which subsequently separated into distinct
conversations.
On the behavioral side, Nelson and Winter (1982) developed
an evolutionary theory of the innovating organization built on
the notion of “routine” as quasi-genetic material that provides
foundations to both stability and change. On this basis, a new
paradigm of research in strategy emerged based on the notion
of search (e.g., Levinthal, 1997) and problem-solving (e.g., Nickerson & Zenger, 2004). Similarly, growing interest went in the
direction of exploring issues related to attention processes and
mechanisms related to the ability of switching across different
learning strategies (e.g., Laureiro et al., 2015; Laureiro & Brusoni, 2018). The discussion about attention is particularly important because it provides a bridge between social and behavioral
approaches to cognition and innovation.
Ocasio (1997) developed parts of the discussion opened up
by March and Simon (1958) who had given attention a central role in their approach, an element that fell under the radar
for many years. Ocasio built on the tradition of organizational
sociology and institutional logics to give the concept of organizational attention flesh, bones, and strategic relevance. In parallel, the concept of routine was also being modernized and
Cognition and Innovation
5
reintegrated into the organizational context where it belongs
by the work of Martha Feldman (2000), among many others.
While routines came to be accepted as the tangible manifestations of organizational cognitive abilities and skills, the discussion about frames and identity also developed in ways very
much consistent with the idea that organizations are institutions moved by socio-cognitive processes embedded in work
processes, structures, and routines. Kaplan (2008) developed
this line of work looking at how different cognitive frames
compete for primacy in organizations. Tripsas (2009) looked at
identity as a major factor that explains which decisions firms
take (or not) when exploring different and alternative technological trajectories.
The Contributions in this Volume
There is by now a rich, although still fairly small, literature studying innovation through socio-cognitive lenses (e.g., Kaplan &
Tripsas, 2008). For example, it has been documented how a
shared understanding of the existing business model directs the
way executives perceive new ideas for business models in incumbent firms (Sund, Villarroel, & Bogers, 2014; Sund, Bogers, Villarroel, & Foss, 2016). Or that it is a combination of cognition and
emotion that leads groups to adopt or not process innovations in
large firms (Choi, Sung, Lee, & Cho, 2011). Or that due to incongruence with existing schemata, innovation originating outside
the firm leads managers to search for information on opportunities or threats (Greve & Taylor, 2000). These, and the many other
studies that have been carried out over the years may appear to
point in all sorts of directions. However, combining the ideas of
cognitive dual-process with the various categorizations of innovation discussed earlier, provides us with a robust structure or
framework for exploring the many contexts and research questions that could be found at the intersection of cognition and
innovation. This is illustrated in Fig. 1.
The studies in this collection all contribute, in their own
ways, to this discussion. Some extend it in new directions, some
add new building blocks to it. For example, one might wish to
study how conscious, cold (emotion-independent) cognition
affects the implementation stage of a new business model. In
such a case, multiple theories of cognition could provide relevant insights. An example is found in Snihur, Thomas, and
6
KRISTIAN J. SUND ET AL.
Process Stage
Innovation
Type
Organizational
Level
Team
(Socio-Cognitive)
Level
Hot Cognition
(emotion-laden)
Individual
Level
Cold Cognition
(emotion-independent)
NonConscious
Conscious
Fig. 1: Framework for the Study of Cognition and Innovation.
Burgelman’s (2018) study in this volume, in which they examine how framing can constitute a strategic process that enables
business model innovators to shape new ecosystems, involving
a number of organizations.
Socio-cognitive processes often occur at the group or team
level within the organization, in which case theoretical development may need to consider just how individual-level cognition
constructs affect team processes. For example, Zaman, Mount,
Pitsis, O’Connor, and Dean (2018) in this volume examine the
implementation of a new technology among hospital workers
(a form of process innovation), illustrating the role of interactive
framing in the social process of adoption and diffusion of the
innovation.
Over time, the discussion about innovation has been linked
to that of leadership. For example, in this volume, Mahdad,
Bogers, Piccaluga, and Di Minin (2018) look at how leadership
enables iterative cycles of sense making and sense giving in
Cognition and Innovation
7
collaborative contexts at the interface between university and
industry. Mammassis and Schmid (2018), also in this volume,
look instead at the role of power in the context of innovation and
change. They build on individual level studies of power (a concept
vastly underexploited in the innovation and cognition literature)
to discuss how paradoxical leadership plays an important
moderating factor on the negative relationship between power
asymmetries and team performance.
The chapters by Zagorac and Marxt (2018) and Biehl, Fehre,
and Tietze (2018) go back instead to the analysis of the sources of
innovation, to reframe (conceptually the former and empirically
the latter) this long and distinguished conversation. They do so
relying on the attention-based view of the firm and on complementarities with the rich and vast literature on entrepreneurship
and opportunity recognition. Biehl et al. (2018) also explore the
potential of new, computer-enabled text analysis techniques to
provide evidence about their reasoning.
Finally, the chapter by von Krogh, Geilinger, and Rechsteiner
(2018) sheds light on one of the great unknowns in the innovation and cognition literature: ethics. In their discussion, they build
on practice approaches to organizing to explore how communities and groups deal with the varying requirements of formal
and informal practices, and which moral dilemmas occur at their
interface.
An Invitation to Explore
This volume of New Horizons in Managerial and Organizational Cognition cannot illustrate all possible contexts of the
presented framework, but we hope it gives sufficient exposure
to the topic to encourage pushing the boundaries and exploring
further. We extend an invitation to both the MOC and innovation management communities to embrace the theoretical and
methodological opportunities that now exist for the study of
cognition, in order to explore just how our thinking affects the
way we develop ideas and turn them into sustainable businesses
and business practices. The various chapters comprising this
volume cover diverse topics such as framing in business models,
cognitive mechanisms in entrepreneurial opportunity identification, paradoxical leadership and the role of management attention in radical product innovation. We hope that this collection
will inspire many others.
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KRISTIAN J. SUND ET AL.
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