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In this chapter, we explore the relationship between organizational complexity and firm-level innovation. We define and operationalize a new construct, experienced complexity, which is the extent to which the organizational environment makes it challenging for decision makers to do their jobs effectively. We distinguish experienced complexity from structural complexity, which is the elements of the organization, such as the number of reporting lines or integrating mechanisms, that are deliberately put in place to help the organization deliver on its objectives, and we argue that structural complexity correlates positively with firm-level innovation, while experienced complexity correlates negatively with innovation. Using a novel dataset combining survey and objective data on 209 large firms, we find support for our arguments.

The literature on organizational learning is very rich and complex. Although most research on learning suggests that it involves individual cognitive, cultural, social, and institutional changes and development, there are slight variations in terms of the number of factors various authors associate with these changes. We discuss the work of several authors as providing a contextual framework for viewing learning as involving both the adoption and diffusion of innovations.

Creativity and innovation have been buzzwords of managerial discourse over the last few decades as they contribute to the long-term survival and competitiveness of firms. Given the non-linear, causally ambiguous, and intangible nature of all innovation-related phenomena, management scholars have been trying to uncover factors that contribute to creativity and innovation from multiple lenses ranging from organizational behavior at the micro-level to strategic management at the macro-level. Along with important and insightful developments in these research streams that evolved independently from one another, human resource management (HRM) research – especially from a strategic perspective – has only recently started to contribute to a better understanding of both creativity and innovation. The goal of this chapter is to review the contributions of strategic HRM research to an improved understanding of creativity at the individual-level and innovation at the firm-level. In organizing this review, the authors rely on the open innovation funnel as a metaphor to review research on both HRM practices and HRM systems that contribute to creativity and innovation. In the last section, the authors focus on more recent developments in HRM research that focus on ambidexterity – as a way for HRM to simultaneously facilitate exploration and exploitation. This chapter concludes with a discussion of future research directions.

Accounting for quality and improved organizational performance has recently received attention in management control research. However, the extent to which process innovation changes have been integrated into management control research is limited. This paper contributes to that integration by drawing from institutional adaptive theory of organizational change and process innovation strategies. The paper utilizes a 2 by 2 contingency table that uses two factors: environmental conditions and organizational change/learning strategies, to build a process innovation framework. A combination of these two factors yields four process innovation strategies: mechanistic, organic, organizational development (OD) and organizational transformation (OT).

The four process innovation typologies are applied to characterize innovations in accounting such as activity based costing (ABC). ABC has been discussed as a multi-phased innovation process that provides an environment where both the initiation and the implementation of accounting change can occur. Technical innovation can be successfully initiated as organic innovation that unfolds in a decentralized organization and requires radical change and double loop learning. Implementation occurs best as a mechanistic innovation in a hierarchical organization and involving incremental change and single loop learning. The paper concludes that if ABC is integrated into an OD or OT intervention strategy, the technical and administrative innovation aspects of ABC can be utilized to manage the organization’s operating activities.

For an organization to be competitive, it needs to constantly innovate. For this to happen, you need the right combination of leaders, talented people, organizational characteristics, and culture. In the chapter, the authors included different perspectives of leadership and models of organizational culture. Both are relevant topics in the field of organizational behavior related to innovation as well as organizational effectiveness.

Contemporary organizations are facing an operating environment characterized by volatile, uncertain, complex, ambiguous, and “permanent whitewater.” To sustain high performance in this context, organizations must be able to change and develop as efficiently and effectively as possible. Within organizations, there are actors who catalyze and advance change in this manner; these actors are known as “champions.” Yet the scholar who wishes to conduct research concerning champions of change and organizational development is likely to be met by a highly fragmented literature. Varying notions of champions are scattered throughout extant research, where authors of articles cite different sources when conceptualizing champions; often superficially. Furthermore, many types of highly specific and nuanced non-generalizable champions have proliferated, making it difficult for practitioners and researchers to discover useful findings on how to go about making meaningful changes in their context. The purpose of this study was to address these problems for practitioners and researchers by engendering thoroughness, clarity, and coherence within champion scholarship. This was done by conducting the first comprehensive, critical yet insightful review of the champion literature within the organizational sciences using content analysis to re-conceptualize champions and develop a meaningful typology from which the field can be advanced. The chapter first suggests a return to Schön (1963) as the basis from which to conceptualize champions and, second, offers a typology consisting of 10 meta-champions of organizational change and development – Collaboration, Human Rights, Innovation, Product, Project, Service, Strategic, Sustainability, Technology, and Venture Champions – from which change practice and future research can benefit.

The paper extends the organizational learning framework: Structural-Functional (SF)-single-loop or Conflictual-Radical (CR)-double-loop learning to the management accounting literature. The sociological approach of organizational learning is utilized to understand those contingent factors that can explain why management accounting innovations succeed or fail in organizations.

We view learning as enhancing an organization’s strategic competitive advantage by making it better able to adopt and diffuse innovation in respond to changes in its environment in order to manage improved performance. The success of management accounting innovations is contingent upon whether its learning process involves SF-single-loop or CR-double-loop learning to adopt and diffuse process innovation.

The paper suggests that the learning strategy that the organization chooses is the reason why some management accounting innovations are more successfully adopted than others and why some innovations are easily diffused in some organizations but not in others. We propose that the sociological approaches to learning provide an alternative framework with which to better understand the adoption and diffusion of process innovations in management accounting systems.

It has become evident that management accounting researchers need to pay particular attention to an organization’s approach to adoption and diffusion of innovation strategies, particularly when they are designing and implementing process innovation programs for an organization. According to Schulz (2001), there are two interrelated stages of the learning that can shape the outcome of the innovation process in an organization. The first stage is related to the acquisition/production (adoption) of knowledge that results in gathering information, codification, and exploration. This is followed by the second stage which is the distribution or dissemination (diffusion) processes. When these two stages – adoption and diffusion – are applied within an accounting context, they address issues that are commonly associated with the successes and/or failures of management accounting innovations.

Although innovation involves learning, the nature of the learning process does not completely describe the manner in which an innovation affects the organization. Accordingly, we suggest that the two interrelated organizational sociological dimensions of innovations processes, namely, (1) the adoption and diffusion theories of Rogers (1971 and 1995), to approach organizational learning, and (2) the SF (single loop) and CR (double loop) approaches to learning be used simultaneously to describe management accounting innovations.

When an innovation is implemented, it initially can be introduced as an incremental change, one that can be limited in both in its scope and its breadth of administrative changes. This means that situations which are most likely to benefit from its initiation can serve as the prototype for its adoption by the organization. If successful, this can be followed by systemic accounting innovations to instituting broader administrative changes within the existing accounting reporting and control systems.

This chapter explores the unique role of leadership in organizational innovation. Drawing from the investment theory of creativity (Sternberg & Lubart, 1995), we show that organizational innovation begins with a leadership decision. Based on a review of the creativity, organizational, and leadership literatures, the key components of organizational innovation are examined from individual, group, and organization-wide perspectives. Leading innovation is conceptualized as a special case of leading organizational change, which requires creative leadership skills applied to social systems. Establishing an organizational environment that supports innovation in the current market environment increases systemic paradoxes that must be managed by leaders. We conclude that leading innovation increases the creative demand on the leadership system, which requires leaders who have a developed understanding of the process of innovation and its environmental requirements.

Despite the theoretical assumption that balancing exploration and exploitation is important for long-term performance and survival, previous studies have provided few insights into these relationships because they have focused mainly on the short-term financial performance of organizations. In addition, balancing exploration and exploitation is a critical challenge for small- and medium-sized enterprises (SMEs) that lack the resources, capabilities, and experience necessary to achieving ambidexterity. In this regards, this study empirically explores the relationship between the exploration–exploitation balance and SMEs’ longevity in order to address two important questions from the ambidexterity perspective: (1) How does the balance between exploration and exploitation influence organizational survival? (2) How is the appropriate balance between exploration and exploitation influenced by an organization’s internal and external contexts?

An analysis of 1981–2012 data from the Korean SMEs in IT industry reveals an inverted U-shaped curvilinear relationship between the extent of exploratory innovation and organizational longevity, providing support for the ambidexterity perspective. We further examine the moderating effects of financial slack and environmental dynamism on the relationship between exploratory innovation and organizational longevity. The results indicate that financial slack moderated the exploration–longevity relationship and call for a contingency approach for a better understanding of performance implications of the exploration–exploitation balance.

The world in which companies operate today is volatile, uncertain, complex, and ambiguous, thus subjecting contemporary forms to an array of risks that challenge their viability in an increasingly competitive landscape. Organizations that cling to their traditional ways of operating impede their ability to survive while those able to embrace evolving changes and lever their strategic response capabilities (SRCs) will thrive against the odds. The possession of such capabilities has become a prominent explanation for effective adaptation to the impending changes but is rarely analyzed and tested empirically. Strategic adaptation typically assumes innovation as an important component, but we know little about how the innovative processes interact with the firm’s SRCs. Hence, this study investigates these implied relationships to discern their effects on organizational performance and risk outcomes. It explores the effects of SRCs and the role of innovation as intertwined adaptive mechanisms supporting strategic renewal that can attain superior performance and risk effects. The relationships are analyzed based on a large sample of US manufacturing firms over the decade 2010–2019. The study reveals that firms possessing effective SRCs have the ability to exploit opportunities and deflect risky situations to gain favorable performance and risk outcomes. While innovation indeed plays a role, the precise nature and dynamic effect thereof remain inconclusive.