Organizational Identity and Innovation

Abstract

Though much work has studied organizational identity and the management of innovation, very little work explores the connection between them. Yet we argue that these separate conversations yield implications for one another and offer a rich area for future research. By its nature, innovation is about novelty and change, while identity is rooted in stability and endurance. This contrast creates a fundamental tension, which we explore. We propose that innovative activities like technological change fall on a spectrum from identity-enhancing to identity-stretching to identity-challenging. Both identity-enhancing and identity-stretching innovations result in a mutually constitutive dynamic in which identity and innovation reinforce each other. Identity-challenging innovations, however, create organizational discord and dysfunctional dynamics unless realigned with identity. We discuss the implications of these varying states and call for future research that builds upon and extends our understanding of the relationship between identity and innovation across multiple levels of analysis.

Keywords: organizational identity, innovation, technological change, management of innovation

JEL Classification: M10, O3, O31, O32