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Unraveling The Paradox Of External Knowledge Sourcing In An Era Of Open Innovation, Appropriation, And Organizational Learning

A. Lorenz
Published 2014 · Political Science

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Organizational learning has been an important topic for the field of organization theory scholars but it is somewhat underexplored in the innovation management literature. I provide a typology and a practical framework to analyze organizational learning from product-related failure experience and its impact on strategic decision making. I include and combine different theoretical approaches from organization theory literature focusing on learning from experience, learning from failure and learning from rare events. Although the literature review reveals that several barriers to effective learning from failure exist, I show that firms will learn more from others’ product failure experience in the short-run than from their own product failure experience. This paper provides two insights. Firstly, firms incorporate own and others’ product failure experience in their strategic decision making. Secondly, they will adapt their innovation strategy based on a preliminary conscious reflection, sensemaking and cause analysis of the failure. I also discuss a practical application of dealing with and avoiding failure. Furthermore, my findings have implications for practitioners and scholars in innovation management. Hence, the paper identifies promising future research directions in the field of organizational learning within the area of innovation management.
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