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Sustained organizational performance depends on top management teams effectively exploring and exploiting. http://search.proquest.com.dbgw.lis.curtin.edu.au/docview/213829440/13E4CEF3D06D4FD439/1? accountid=10382 Top management teams balance short-term performance and long-term adaptability through resource allocation trade-offs and organizational designs decisions (Edmondson et al. 2003, Eisenhardt and Zbaracki 1992, Hambrick 1994). These strategic decisions require teams to negotiate between the existing product and the innovation, identifying outcomes that will ensure the performance of both agendas. Borrowing from the negotiation and conflict management literature, we define balanced strategic decisions based on two criteria: (1) their distributive nature, which we define as making balanced trade-offs over time; and (2) their integrative nature, which we define as identifying synergies (Bazerman 1998, Lax and Sebenius 1986, Walton and McKersie 1965). http://search.proquest.com.dbgw.lis.curtin.edu.au/docview/213829440/13E4CEF3D06D4FD439/1? accountid=10382 The distributive aspect of a decision involves the division of resources between the existing product and the innovation. Lax and Sebenius (1986) call this "claiming value," as managers identify resources for each individual product. Teams make a number of decisions in which they might preferentially support either the existing product or the innovation. These decisions are balanced when, over time, they support both products. For example, Ciba Vision's top management team balanced the ongoing demands of their conventional hard lenses even as they invested in daily disposables, extended wear, and Visudyne (Tushman and O'Reilly 1997). In allocating scarce resources, this senior team worked to balance the needs of the existing product even as they worked to develop several possible substitutes. http://search.proquest.com.dbgw.lis.curtin.edu.au/docview/213829440/13E4CEF3D06D4FD439/1? accountid=10382 Innovation has been hailed as the primary source of wealth creation, and absolutely essential for corporate survival (Dillon, Lee and Matheson, 2005) http://search.proquest.com.dbgw.lis.curtin.edu.au/docview/763161472/13E4CEF3D06D4FD439/5? accountid=10382


The trick, he argued, was for CEOs to model themselves on that icon of American consumer culture, Colonel Sanders. "If you're a customer of Microsoft or Bloomberg, you assume Bill Gates and Michael Bloomberg are involved every step of the way, just as you assume Colonel Sanders cooks every Kentucky Fried Chicken. "In fact, the Colonel has been dead for a couple of years. Maybe Gates and Bloomberg have as well. But that doesn't matter any more." http://search.proquest.com.dbgw.lis.curtin.edu.au/docview/248619592/13E4CEF3D06D4FD439/ 6?accountid=10382 The literature also suggests that, due to limited financial and human resources, SMEs must rely on external R&D and must develop co-operation and partnership in technology and innovation with other SMEs, public institutions, and large corporations (Dodgson and Rothwell, 1991; Riedle, 1989). Unfortunately, this was not true in our case. The respondents felt that input from internal R&D was more important. http://search.proquest.com.dbgw.lis.curtin.edu.au/docview/217377877/13E4CEF3D06D4FD439/ 7?accountid=10382 In order to get an overall picture of the executive's reported satisfaction with innovative actions in their business, the 43 items were loaded on six factors as suggested by Birchall et al. (1996) and the mean scores were then computed. The six factors were: actions for continuous improvement, technology management, internal management system, pressures for cost cutting, sectorial technological innovativeness, and structures for managing innovation. http://search.proquest.com.dbgw.lis.curtin.edu.au/docview/217377877/13E4CEF3D06D4FD439/ 7?accountid=10382 Continuous improvement of work processes was ranked the most important action for improving the short-term profitability, while increasing customer focus was ranked the most important action for improving long-term wellbeing of the company. http://search.proquest.com.dbgw.lis.curtin.edu.au/docview/217377877/13E4CEF3D06D4FD439/ 7?accountid=10382 The demands placed on business by customers/clients, close working relationship with a key customer, and input from their own R&D department were considered as the most relevant sources for successful innovation in product/service. On the other hand, suggestions from internal quality improvement groups was ranked as the most important source of innovation for work processes and procedures. http://search.proquest.com.dbgw.lis.curtin.edu.au/docview/217377877/13E4CEF3D06D4FD439/ 7?accountid=10382

And one key to accomplishing that is to identify, hire, retain and properly manage gatekeepers, those technical professionals who span organizational boundaries and accelerate the process of invention by contributing to and capitalizing on interfirm spillovers of important knowledge. http://search.proquest.com.dbgw.lis.curtin.edu.au/docview/224959248/13E4CEF3D06D4FD439/20?accountid=10382

Complexity refers to the degree to which an organisation‟s members possess a relatively high level of knowledge and expertise, usually measured by the members‟ range of occupational specialties and their degree of professionalism expressed by formal training (Rogers, 1995). Complexity encourages the organisation‟s members to envision and propose innovations (Woodman, 1993), knowledge intensive organisations also tend to be more innovative (Freel, 2000). Interconnectedness is the degree to which the units in a social system are linked by


interpersonal networks (Rogers, 1995). New ideas can flow more easily among an organisation’s members if the organisation has higher network interconnectedness, leading to greater information sharing and openness (Troy et al., 2001). Interconnectedness could be measured by the degree that organisation‟s members are able to communicate easily and freely with each other and with members of management (Ruppel &Harrington, 2000). The cumulative evidence suggests that openness of communication facilitates the creative output of the organisation‟s members (Troy et al., 2001). http://www.cemi.com.au/sites/all/publications/ANZRATAMMAZZ.pdf Organisational slack is defined as the degree to which uncommitted resources are available to an organisation (Rogers, 1995)to adapt to internal and external pressures (Ahmed, 1998). Organisational slack has been correlated positively with innovation and can be measured by the availability of resources provided by the company. While some resources are relatively small others are large (e.g. financing major R&D projects). This might also include the availability of financial rewards and incentives to creative and innovative employees. Whether large or small, the effect of the innovation investment funds was to stimulate ideas within the organization (Light, 1998). http://www.cemi.com.au/sites/all/publications/ANZRATAMMAZZ.pdf Leadership, particularly from the owner-manager or Chief Executive Officer (CEO), is important in encouraging innovation and supplying the management and resources to make it happen (Brunner, 2001). Scott and Bruce (1994) have suggested that leadership affects individual innovative behaviour directly and indirectly through perceptions of a „climate‟ –sub-unit of culture –for innovation. The leaders of innovative organisations made their greatest contributions for other members to succeed, by caring most about the soil in which innovation and ordinary good practice grow (Light, 1998). Although there is a lack of a common classification system for leadership theory (Reser &Sarros, 2000), the two main leadership styles considered most appropriate to understanding its potential impact on innovation are transformational and transactional leadership (Parry, 2000b). According to Birnbaum (1999), there are several major differences between the two types of leadership, which are discussed in later sections. Transformational leadership emphasizes the potential power of leaders; transactional leadership notes the potential influence of followers. Transformational leadership looks for major changes of policy and direction; transactional leadership is likely to move in smaller, incremental steps. Transformational leadership captures their imagination; transactional leadership is more ordinary and less dramatic (Birnbaum, 1999). http://www.cemi.com.au/sites/all/publications/ANZRATAMMAZZ.pdf


The trick, he argued, was for CEOs to model themselves on that icon of American consumer culture, Colonel Sanders. "If you're a customer of Microsoft or Bloomberg, you assume Bill Gates and Michael Bloomberg are involved every step of the way, just as you assume Colonel Sanders cooks every Kentucky Fried Chicken. "In fact, the Colonel has been dead for a couple of years. Maybe Gates and Bloomberg have as well. But that doesn't matter any more." http://search.proquest.com.dbgw.lis.curtin.edu.au/docview/248619592/13E4CEF3D06D4FD439/ 6?accountid=10382 The literature also suggests that, due to limited financial and human resources, SMEs must rely on external R&D and must develop co-operation and partnership in technology and innovation with other SMEs, public institutions, and large corporations (Dodgson and Rothwell, 1991; Riedle, 1989). Unfortunately, this was not true in our case. The respondents felt that input from internal R&D was more important. http://search.proquest.com.dbgw.lis.curtin.edu.au/docview/217377877/13E4CEF3D06D4FD439/ 7?accountid=10382 In order to get an overall picture of the executive's reported satisfaction with innovative actions in their business, the 43 items were loaded on six factors as suggested by Birchall et al. (1996) and the mean scores were then computed. The six factors were: actions for continuous improvement, technology management, internal management system, pressures for cost cutting, sectorial technological innovativeness, and structures for managing innovation. http://search.proquest.com.dbgw.lis.curtin.edu.au/docview/217377877/13E4CEF3D06D4FD439/ 7?accountid=10382 Continuous improvement of work processes was ranked the most important action for improving the short-term profitability, while increasing customer focus was ranked the most important action for improving long-term wellbeing of the company. http://search.proquest.com.dbgw.lis.curtin.edu.au/docview/217377877/13E4CEF3D06D4FD439/ 7?accountid=10382 The demands placed on business by customers/clients, close working relationship with a key customer, and input from their own R&D department were considered as the most relevant sources for successful innovation in product/service. On the other hand, suggestions from internal quality improvement groups was ranked as the most important source of innovation for work processes and procedures. http://search.proquest.com.dbgw.lis.curtin.edu.au/docview/217377877/13E4CEF3D06D4FD439/ 7?accountid=10382

And one key to accomplishing that is to identify, hire, retain and properly manage gatekeepers, those technical professionals who span organizational boundaries and accelerate the process of invention by contributing to and capitalizing on interfirm spillovers of important knowledge. http://search.proquest.com.dbgw.lis.curtin.edu.au/docview/224959248/13E4CEF3D06D4FD439/20?accountid=10382

Complexity refers to the degree to which an organisation‟s members possess a relatively high level of knowledge and expertise, usually measured by the members‟ range of occupational specialties and their degree of professionalism expressed by formal training (Rogers, 1995). Complexity encourages the organisation‟s members to envision and propose innovations (Woodman, 1993), knowledge intensive organisations also tend to be more innovative (Freel, 2000). Interconnectedness is the degree to which the units in a social system are linked by


interpersonal networks (Rogers, 1995). New ideas can flow more easily among an organisation’s members if the organisation has higher network interconnectedness, leading to greater information sharing and openness (Troy et al., 2001). Interconnectedness could be measured by the degree that organisation‟s members are able to communicate easily and freely with each other and with members of management (Ruppel &Harrington, 2000). The cumulative evidence suggests that openness of communication facilitates the creative output of the organisation‟s members (Troy et al., 2001). http://www.cemi.com.au/sites/all/publications/ANZRATAMMAZZ.pdf Organisational slack is defined as the degree to which uncommitted resources are available to an organisation (Rogers, 1995)to adapt to internal and external pressures (Ahmed, 1998). Organisational slack has been correlated positively with innovation and can be measured by the availability of resources provided by the company. While some resources are relatively small others are large (e.g. financing major R&D projects). This might also include the availability of financial rewards and incentives to creative and innovative employees. Whether large or small, the effect of the innovation investment funds was to stimulate ideas within the organization (Light, 1998). http://www.cemi.com.au/sites/all/publications/ANZRATAMMAZZ.pdf Leadership, particularly from the owner-manager or Chief Executive Officer (CEO), is important in encouraging innovation and supplying the management and resources to make it happen (Brunner, 2001). Scott and Bruce (1994) have suggested that leadership affects individual innovative behaviour directly and indirectly through perceptions of a „climate‟ –sub-unit of culture –for innovation. The leaders of innovative organisations made their greatest contributions for other members to succeed, by caring most about the soil in which innovation and ordinary good practice grow (Light, 1998). Although there is a lack of a common classification system for leadership theory (Reser &Sarros, 2000), the two main leadership styles considered most appropriate to understanding its potential impact on innovation are transformational and transactional leadership (Parry, 2000b). According to Birnbaum (1999), there are several major differences between the two types of leadership, which are discussed in later sections. Transformational leadership emphasizes the potential power of leaders; transactional leadership notes the potential influence of followers. Transformational leadership looks for major changes of policy and direction; transactional leadership is likely to move in smaller, incremental steps. Transformational leadership captures their imagination; transactional leadership is more ordinary and less dramatic (Birnbaum, 1999). http://www.cemi.com.au/sites/all/publications/ANZRATAMMAZZ.pdf


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