Public managers’ perception of exploitative and explorative innovation: an empirical study in the context of Spanish municipalities
| DOI | 10.1177/0020852319894688 |
| Published date | 01 March 2022 |
| Date | 01 March 2022 |
| Subject Matter | Articles |
Article
Public managers’
perception of
exploitative and
explorative innovation:
an empirical study in the
context of Spanish
municipalities
Jose M. Barrutia
University of the Basque Country, Spain
Carmen Echebarria
University of the Basque Country, Spain
Abstract
This article studies the contribution of exploitative and explorative innovation to the
perceptions of economic and social value of local authorities in charge of sustainability-
related innovation. The model proposed is tested capturing the perceptions of 656
local authorities. The research findings contribute evidence of complex linkages
between innovation forms (i.e. exploitative and explorative) and facets of perceived
value. Overall, the link between the perceptions of both forms of innovation and eco-
nomic value fits March’s (1991) view. A positive effect of both exploitative and explor-
ative innovation on economic value is found, coupled with a negative interaction effect.
The influence of exploitative innovation is stronger than that of explorative innovation.
However, this is only part of the story. We also consider the link between exploitative/
explorative innovation and one additional facet of value: social value (in the form of
network identification). The roles of both predictors are virtually opposite: identifica-
tion is mostly explained by explorative innovation, rather than exploitative innovation.
The social value dimension considered in this research adds an explanation as to why
Corresponding author:
Jose M. Barrutia, University of the BasqueCountr y(UPV/EHU), Avenida Lehendakari Agirre 83, 48015 Bilbao,
Spain.
Email: josemaria.barrutia@ehu.es
International Review of Administrative
Sciences
!The Author(s) 2020
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DOI: 10.1177/0020852319894688
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2022, Vol. 88(1) 131–151
public organisations may focus on exploration or combine both exploitation and
exploration.
Points for practitioners
•Public managers may focus on exploitative innovation (when economic value con-
siderations are dominant) and on explorative innovation (when social value thinking
prevails), or combine both activities.
•Network promoters should not assume that public managers favour exploitative
innovation over explorative innovation.
Keywords
economic value, innovation, networks, public managers’ perception, social value
Introduction
March (1991) discussed managers’ perceptions of exploitation and exploration, as
well as their effect on the survival of organisations. In essence, he understood
exploitation as the refinement and extension of existing competences, technologies
and paradigms, and exploration as experimentation with new alternatives. He also
explained why managers give priority to exploitation and drive out exploration,
employing three core arguments. First, while exploitation outcomes tend to be
perceived as proximate, clear and predictable, and are usually positive, exploration
returns tend to be viewed as distant, diffuse and uncertain, and are often negative.
Second, there are increasing returns from experience, which produces strong path
dependence. Third, exploitation and exploration are by nature different activities
that require specific and sometimes contradictory resources, which are difficult to
bring together. He viewed these factors as drivers of a self-destructive process in
which managers favour projects with lower potential returns that nevertheless fall
within the current area of expertise of the organisation and do not sustain the
reasonable level of exploration that is needed for long-run survival.
This challenging view generated an enormous research effort that has improved
our understanding of organisational learning, though we are far from achieving a
consensus in many aspects (Junni et al., 2013; Lavie et al., 2010). What is surpris-
ing, however, is the overreliance of this literature on the private sector. Some recent
studies have focused on the public sector (Boukamel and Emery, 2017; Cannaerts
et al., 2016; Choi and Chandler, 2015; Gieske et al., 2019; Kobarg et al., 2017;
Palm and Lilja, 2017; Plimmer et al., 2017; Smith and Umans, 2015). These con-
tributions have mostly addressed the concept of ambidexterity (i.e. how public
sector organisations (PSOs) may combine/balance exploitation and exploration).
As there is a consensus on the idea that ambidexterity is necessary for the long-
term success of PSOs (Boukamel and Emery, 2017; Gieske et al., 2019; Plimmer
132 International Review of Administrative Sciences 88(1)
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