Technology brokering and innovation in a product development firm

Hargadon, A. & R. Sutton. 1997. “Technology brokering and innovation in a product development firm”. Administrative Science Quarterly; 42, 4

Knowledge is imperfectly shared over time and across people, organizations, and industries: ideas from one group might solve the problems of another, but only if connections between existing solutions and problems can be made across the boundaries between them.

Social network theory suggests that Edison’s laboratory could innovate routinely because it occupied a “structural hole” (Burt, 1992a, 1992b), a gap in the flow of information between subgroups in a larger network.

Actors filling these gaps are brokers who benefit by transferring resources from groups where they are plentiful to groups where they are dear.

A technology broker depends on both its network position as a broker and on an organizational memory that allows it to acquire, retain, and retrieve new combinations of information obtained through such a position.

Five brainstorming rules are displayed in large letters in several locations in each room:

  1. defer judgment
  2. build on the ideas of others
  3. one conversation at a time
  4. stay focused on the topic
  5. encourage wild ideas.

A process model of technology brokering

IDEO learns about potentially useful technologies by working for clients in multiple industries and finds opportunities to use that knowledge by incorporating it into new products for industries where there is little or no prior knowledge of these technologies.

Technology brokering  entails more than just transporting ideas between previously unconnected industries; it also means transforming, sometimes radically, those ideas to fit new environments and new combinations.

Creativity
Putting old things in new combinations and new things in old combinations
Weick, 1979

The relationship between network position and internal behaviors:

  • Access: IDEO fills a gap in the flow of information between industries and is able to see technological solutions in one area that are potentially valuable in others
  • Acquisition: routines that IDEO’s designers use to bring technological solutions into the organizational memory, where they are stored for possible use in future design projects
  • Storage: how these solutions remain in memory until they are considered for use in future designs
  • Retrieval: how designers retrieve some of these old technological solutions from the organizational memory in forms that fit the new combinations they are creating

Access: IDEO’S network position as technology broker

IDEO’s value as a technology broker depends not only on the number of clients and industries it works with (volume of contacts), but also on the technologies in those industries that are potentially valuable yet previously unknown in others.

Technology brokering is visible at the level of firms and industries,but it takes place through the actions of teams and people.

At IDEO, designers view their community as a valuable clearinghouse for technological solutions that they have accumulated through years of access to dozens of industries.

This community experience allows them to “cross-pollinate” their ideas between products and industries.

Acquisition, storage, and retrieval: IDEO’s internal routines for technology brokering

Organizational memory becomes visible when individual members react to new demands by drawing on an organizational pool of prior responses to similar stimuli.

By routinizing search activities in standard operating procedures, organizations can become more efficient at performing them.

Organizational memory can also support innovation by retaining a broader range of potential responses, providing more options for organizational decision makers.

Acquisition

IDEO designers acquire these solutions by talking to and watching new clients and others in the industry, by reading about the industry, by looking at and taking apart products in and related to those in the industry, and, finally, by designing products for that industry.

While much of the knowledge acquired during these activities remains in the memories of IDEO’s designers after a project is completed, the act of designing that new product is also an important step in bringing working knowledge of these new technologies into the organization.

Which is critical to a firm’s absorptive capacity, or ability to exploit emerging technologies.

Storage

At IDEO, the storage of technological knowledge became visible only as we observed the retrieval process in conversations, brainstorms, and other group problem-solving activities.

Much of the knowledge of potential solutions resides in the minds of the individual designers as products they had seen or used before, projects they hadworked on, or technologies they had read, heard, or talked about.

Routines for storing specific technological knowledge at IDEO placed potential solutions in the memories of individual designers and in the objects and products that designers collected from their previous work.

This “technology cabinet” was a collective rather than an individual good. It was started with “donations from several designers’ private collections of cool stuff,” and it soon became “cool” among a wider set of designers to add new “neat and strange things” and to tell other designers about what they added.

The technological solutions in the minds, written records, and products of individual designers are valuable only when they can be retrieved easily for use in current projects.

Informants told us that, to be valued by one’s peers, it was important to establish a reputation for having expertise that is distinctive within the community of IDEO designers.

So beyond developing his own focused technical expertise, each designer develops broader knowledge about which designers have which technical knowledge. This broader knowledge grows in parallel with the retrieval process in brainstorming meetings and other social interactions like Monday morning meetings, informal lunches, and company parties.

Retrieval

At IDEO, retrieval entails bringing stored knowledge of potentially valuable technological solutions to bear on the design problems of current projects.

If you take all the existing products or thoughts on existing products and gather them and then took the best part of each one and combined them, you’d have a better product. It is as simple as that.
IDEO Designer

Analogies play a critical role in organizational memory because they allow individuals to link past stimulus-response information to current stimuli.

Analogic thinking is critical to the brokering of potentially innovative solutions because it allows for acquisition and storage of technologies in their original implementations, but for retrieval in forms adapted to the needs of the current design problem.

Much of the retrieval process at IDEO entails bringing designers with knowledge of potentially relevant technologies into direct contact with the problems of a new design project.

Brainstorms are like a big open-book exam where you’re allowed to bring stuff in.
IDEO Designer

Discussion

Organizational support for technology brokering

This flow of new problems provides incentives for them to develop, and opportunities for them to exploit, a wide-ranging knowledge of potential solutions.

Engineers also do not specialize in any single industry but, instead, often move to new industries after completing a single project in one industry.

Engineers also often transfer on and off long-term projects to prevent “burn-out” and allow them to pursue interests in other areas.

As a designer you love variety and, not havingto do the same thing for years on end, it keeps you fresh and it makes you more confident that you can use something you learned in this area and move from there.
IDEO Project manager

Work is also structured so that teams are formed and disbanded around individual projects and often pull in additional members for brainstorms or short bursts of effort.

Much of this benefit, however, depends on IDEO’s strong norms for designers to share their disparate knowledge and help one another.

IDEO’s formal and informal reward systems provide substantial support for such collaboration:  Top managers determine designers’ pay and responsibility, and while they place weight on the number of hours billed, compensation decisions are based largely on informal reputation among fellow designers and formal peer reviews.

Following the attitude of wisdom, people who don’t ask for help are thought to be either too insecure or too arrogant, to lack humility about what they know and respect for what others at IDEO know.

Employee selection is done by (future) peers who look for new designers with the right technical knowledge and skill (including backgrounds that bring new design solutions into IDEO) and an inclination to follow IDEO’s work practices and norms.

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