Diffusion in the Face of Failure: The Evolution of a Management Innovation

Published date01 July 2015
DOIhttp://doi.org/10.1111/1467-8551.12093
Date01 July 2015
AuthorHarry Scarbrough,Jacky Swan,Maxine Robertson
British Journal of Management, Vol. 26, 365–387 (2015)
DOI: 10.1111/1467-8551.12093
Diusion in the Face of Failure: The
Evolution of a Management Innovation
Harry Scarbrough, Maxine Robertson1and Jacky Swan2
Cass Business School, City University London, UK, 1School of Business and Management, Queen Mary
University of London, London, UK, and 2Warwick Business School, University of Warwick, Coventry, UK
Corresponding author email: harry.scarbrough.1@city.ac.uk
Recent work has questioned the institutional model of management innovation by high-
lighting interactions between the field-level actors engaged in diusing innovations and
implementation of the innovation at organization level. Focusing on the adaptation of
management innovations to their context, rather than their creation,we review this work
and use it to analyse the global diusion of resource planning (RP), counter posing this
case with the widely studied example of total quality management. Both of these innova-
tions experienced a high levelof failure when implemented by organizations. Total quality
management’s diusion was characterized by a ‘boom and bust’ cycle. RP, however, has
continued to spread globally in the form of its variants: MRP, MRPII and ERP. Our
analysis seeks to account for the long-run diusion of RP through a processual model
which highlights the interplay between RP’s discursive framing at field level, the aor-
dances of the innovation itself and its adaptation within organizations. This demonstrates
how objectifying RP in software not only helped to spreadthe innovation but also allowed
field-level actors to dierentiate its developmentas a successful innovation from the many
failures experienced by organizations attempting to adapt it.
Introduction
Management innovation is a term used to refer
to the generation and implementation of new
management practices, processes, structures and
techniques that are intended to further organiza-
tional goals (Birkinshaw, Hamel and Mol, 2008;
Vaccaro et al., 2012). Innovation here means new
to the organization, rather than new to the world
(Birkinshaw, Hamel and Mol, 2008). In this paper
we consider how the spread of such innovations
across organizations is influenced by the expe-
rience of implementing such innovations within
organizations.This question is relevant to manage-
ment innovations because they are characterized
by high degrees of ambiguity, context dependency
and ‘interpretive flexibility’ (Abrahamson, 1996).
As such, they typically undergo significant adapta-
tion when implemented and their ‘success’ is often
dicult to assess (Ansari, Fiss and Zajac, 2010).
Institutional models of diusion help to explain
the spread of management innovations because
they consider the ways in which social and insti-
tutional mechanisms drive diusion and adoption
(Strang and Meyer, 1993). While other work em-
phasizes technical or economic benefits as drivers
of diusion, the focus of institutional models is
on the way in which certain innovations come to
be seen as legitimate or even ‘must-have’ features
of organizational life. At the extreme, as with the
study of management fashions, the spread of new
management practices may be seen as driven by
‘bandwagons’ and ‘success stories’ that have little
to do with their performance benefits for organiza-
tions (Abrahamson, 1996; Scarbrough and Swan,
2001). Institutional models thus provide a comple-
mentary alternative to the view that innovations
spread because of their comparative performance
benefits (Kennedy and Fiss, 2009), and it is to this
line of inquiry that we contribute here.
© 2015 British Academy of Management. Published by John Wiley & Sons Ltd, 9600 Garsington Road, Oxford OX4
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366 H. Scarbrough, M. Robertson and J. Swan
To date, however, institutional accounts
have focused mainly on field-level processes
(e.g. isomorphism), with insucient consideration
of how innovations are reinvented and evolve as
they diuse (cf. Rogers, 1995), or of managers’
agency in adapting them as they implement and
use them (Ansari, Reinecke and Span, 2014; Vac-
caro et al., 2012). Work on the implementation of
management innovations, by contrast, has tended
to focus on firm or sector-level experience rather
than on wider processes of evolution (see Birkin-
shaw, Hamel and Mol, 2008, for a critique). There
is therefore still relatively little understanding of
the processes through which field-level diusion
and organizational-level implementation interact
and how this drives the evolution of management
innovation. In response, our study seeks to de-
velop, as its principal theoretical contribution, a
processual model of the evolution of management
innovation thataccounts for the interplay between
diusion and implementation.
To develop such a model requires a multi-level
approach, one capable of relating the implementa-
tion of new practices within local settings to the
emergence of field-level actors and their influences
upon the spread of innovation.This, it has been ar-
gued, is especially the case with management inno-
vations because their spreadand adoption is highly
influenced by both field- and organization-level
influences (Birkinshaw, Hamel and Mol, 2008).
Such a multi-level analysis enables us to address a
‘dearth of attempts to bridge inter-organizational
mechanisms of diusion with intra-organizational
implementation and adaptation’ (Ansari, Fiss and
Zajac, 2010, p. 68).
In the next section, we review existing studies
of the evolution of management innovations and
use the particular example of total quality man-
agement (TQM). From this we begin to draw out
the elements of a provisionalprocessual model and
identify key research questions. We then develop
our processual model through a theory devel-
opment case study (Abrahamson and Eisenman,
2008) centred on a historical analysis of the evo-
lution of resource planning (RP). This innovation
involves the use of cross-functional integrated sys-
tems to plan and control the flow of resources in
organizations. It is considered to be one of the
most important, and widely spread, management
innovations of recent years (Mol and Birkinshaw,
2008). It involves a core of technical knowledge
coupled with changes across management prac-
tices, processes and structures, thus blurring the
conventional distinction between ‘administrative’
and ‘technological’ innovation (cf. Damanpour,
1987, 2010). It therefore provides a good case from
which to build theory bydeveloping our processual
model.
In the final section, we discuss the elements of
this model, highlighting processes that appeared
to drive the evolution of this innovation that have
not previously been identified. In particular, a dis-
tinctive feature of this management innovation is
its successful global diusion in the face of widely
reported, high levels of implementation failure,
and associated detrimental eects on organiza-
tional performance. Our model provides explana-
tory power for this phenomenon because it relates
distinctive features of the innovation, and its adap-
tation by organizations, to the waysuccess and fail-
ure were framed by its promoters.
The evolution of management
innovations: the need for a processual
view
In discussing institutional influences on diusion,
it is important to distinguish between macro-level
institutional factors, which help to explain the
spread of innovations across national contexts
(Guler, Guill´
en and Macpherson, 2002), and
the field-level factors which help to explain their
spread across organizations. For the latter, the in-
stitutional model can be contrasted with ‘classical’
(Rogers, 1995) or ‘rational’ models of diusion
(Ansari, Fiss and Zajac, 2010; Damanpour, 1987,
2010; Wischnevsky, Damanpour and M´
endez,
2011). The institutional model suggests that, while
early adopters may be motivated by performance
benefits, as the innovation spreads, adopting or-
ganizations become more concerned with seeking
legitimacy through a process of isomorphism
(Meyer and Rowan, 1977; Tolbert and Zucker,
1983). Diusion may thus, in some cases, be
driven by fashion or social bandwagon eects
(Abrahamson, 1991; Strang and Meyer, 1993).
However, recent work has begun to question
some aspects of this model, with studies high-
lighting both the agency of the groups involved
(Henfridsson and Yoo, 2013; Lounsbury, 2002)
and variations in the adoption of innovative prac-
tices at the organization level. These studies have
suggested that innovations may not only be more
© 2015 British Academy of Management.

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