Organizational Ingenuity in Nascent Innovations: Gaining Resources and Legitimacy through Unconventional Actions

Abstract

How do innovators in large organizations acquire resources for their early-stage, untested, unproven innovations? Multiple established projects compete for scarce resources in large organizations. Innovators pursuing early-stage, untested innovations face considerable constraints in accessing scarce resources. Literature enumerates various sanctioned and unsanctioned methods by which innovators acquire resources, such as borrowing, begging, scavenging, amplifying, bootlegging, and finagling – defined as obtaining resources through deceitful or underhanded methods. However, few theories explain how innovators act unconventionally, elude constraints to acquire resources, and yet gain acceptance for their innovations. To address this question, this study uses field data from nine organizations based primarily in Silicon Valley. Successful innovators employ organizational ingenuity or creative solutions to gain resources in the face of constraints. They employ two types of ingenuity: material ingenuity, creatively re-imagining the use of resources; and process ingenuity, using creative processes to gain resources. In the early stages, innovators focus on managing their innovation’s legitimacy and use managerial attention as a key lever. They maximize managerial attention when employing material ingenuity and minimize managerial attention when utilizing process ingenuity. Theories highlighting the relationship between legitimacy and resource acquisition suggest that individuals gain resources when they establish legitimacy. Conversely, study results indicate that the process of gaining resources can lend legitimacy to early-stage innovations.