|M.Sc Student||Faivush Michael|
|Subject||How Does Organizational Structure Affect Team Innovation?|
|Department||Department of Industrial Engineering and Management||Supervisor||PROFESSOR EMERITUS Miriam Erez|
|Full Thesis text|
Innovation drives our modern world, yet despite its importance, the research literature still differs regarding how it is best fostered. The answer may vary depending on the type of outcome desired, specifically, radical innovation, or incremental innovation. Firms attempt to foster the level of innovation that they require through the use of organizational structures, such as centralization, to manage the flow and integration of knowledge, for which innovation depends. However, these organizational processes may have different effects across teams, according to the values that they hold. We examine these dynamics in a study of a large, multi-national, Chinese clean-energy company. Our findings indicate that: a) centralization’s effect on radical/incremental innovation, fully relies on its ability to impact knowledge integration, which mediates the relationship, b) knowledge integration positively affects radical innovation, c) contrary to predominant literature on knowledge integration’s beneficial effects for innovation, this study finds it to weaken incremental innovation, d) centralization’s relationship to knowledge integration depends on the level to which teams value power distance, such that in teams with high power distance, knowledge integration decreases as centralization increases, e) knowledge integration’s relationship with radical innovation depends on the level to which teams value collectivism, such that in teams with low collectivism, greater knowledge integration leads to greater radical innovation, f) knowledge integration’s relationship with incremental innovation depends on the level to which teams value collectivism, such that in teams with low collectivism, greater knowledge integration leads to lower incremental innovation. Our research contributes to the literature by introducing a moderated mediation model to better understand antecedents for innovation levels. Further, we provide support for utilizing originally national level cultural constructs at the level of team held values. Finally, this study fills a gap in the literature regarding what contributes to incremental innovation. Theoretical and practical implications are discussed.