Rotterdam School of Management, Erasmus U., Netherlands
Many firms fail to innovate because of their inability to select and implement novel ideas. Evaluators often turn down novel ideas and therefore act as roadblocks to innovation. But why do evaluators tend to reject novel ideas more often than conventional ideas? Novel ideas are often associated with ambiguity and therefore may create uncertainty in evaluators’ minds. Under these circumstances, evaluators have problems perceiving an idea’s usefulness which is why they often reject such an idea. In this study, we propose a mechanism to boost evaluators’ perception of usefulness. Specifically, we argue that when functionally diverse expert advisors are involved in the evaluation and selection of ideas, a process of sensemaking is activated which will help reduce evaluators’ uncertainty about an idea, allowing them to better comprehend an idea and to perceive the usefulness of novel ideas. We find support for our hypotheses by leveraging unique archival data of an idea management system of a multinational insurance company where ideas are assessed in collaboration with expert advisors. Our findings have broad implications for the literature on innovation and idea evaluation as they highlight the importance of sensemaking and collaborating with functionally diverse expert advisors during idea evaluation and selection processes.
