Antecedents of New Business Idea Generation in Large, Established Firms

Advanced Institute of Management Research Paper No. 058

82 Pages Posted: 3 Dec 2008

See all articles by Julian Birkinshaw

Julian Birkinshaw

London Business School

Susan A. Hill

Cass Business School, City University London

Date Written: October 1, 2007

Abstract

Despite its importance as a potential source of variation within industries, little is currently known about the antecedents of new business ideas in large, established firms. While a number of organization and management literatures address, tangentially, issues pertaining to this topic, none examines it directly. We aim in this paper to contribute to building a body of research that directly addresses idea generation in corporate contexts.

From a conceptual standpoint, we propose a theoretical framework of the roles corporate context (viewed from an attentional and information processing perspective) and individual knowledge play in influencing the nature of new business ideas generated by an organization's members. In so doing, we put forward the concept of new business idea sets: the complete stock of new business ideas a person is considering at any given time. By characterizing idea sets along a number of generic dimensions, we contend that new insights into, and a more comprehensive understanding of, corporate idea generation is enabled. We then develop a set of hypotheses regarding commonalities and differences between the contextual and knowledge-based antecedents of idea set novelty (the novelty of a person's ideas at a given time) and idea set volume (the quantity of ideas a person is considering at a given time).

From an empirical standpoint, we develop and test our theoretical devices and propositions in a multi-stage field study, comprising: pilot research with 20 knowledge workers in a multinational FMCG company; a survey of 388 knowledge workers across 3 large, multinational organizations (with supplementary supervisory and top management team data); and longitudinal case studies of 22 knowledge workers observed over a 12-month period. In the empirical test described in this paper, using our primary survey data, we anticipate and find that different knowledge processes underlie the novelty and volume of ideas corporate knowledge workers generate. While idea set novelty is primarily accounted for by equivocality-reducing processes of knowledge transformation, idea set volume is explained rather by knowledge combination processes. Furthermore, exposure to a broad range of stimuli enables both many as well as highly novel new business ideas, while broad individual work experience is only associated with the volume of ideas generated. These findings highlight the value of integrating and extending the constructs and propositions of extant literature streams to generating new understandings of corporate idea generation. AIM

Suggested Citation

Birkinshaw, Julian and Hill, Susan A., Antecedents of New Business Idea Generation in Large, Established Firms (October 1, 2007). Advanced Institute of Management Research Paper No. 058. Available at SSRN: https://ssrn.com/abstract=1309580 or http://dx.doi.org/10.2139/ssrn.1309580

Julian Birkinshaw (Contact Author)

London Business School ( email )

Sussex Place
Regent's Park
London, London NW1 4SA
United Kingdom

Susan A. Hill

Cass Business School, City University London ( email )

106 Bunhill Row
London, EC1Y 8TZ
United Kingdom

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