Leveraging Resistance to Change and the Skunk Works Model of Innovation

Andrea Fosfuri () and Thomas Rønde ()

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Abstract: We study a situation in which an R&D department promotes the introduction of an innovation that results in costly re-adjustments for production workers. In response, the production department tries to resist change by improving the existing technology. Resistance to change triggers competition between departments, which, in turn, spurs effort. We show that firms balancing the strengths of the two departments perform better. As a negative effect, resistance to change might distort the R&D department's effort away from radical innovations. The firm can solve this problem by implementing the so-called skunk works model of innovation where the R&D department is isolated from the rest of the organization. Several implications for managing resistance to change and for the optimal design of R&D activities are derived.

Keywords: L2; M12; M54; O31; O32; Resistance to change; Innovation; Skunk works model; Contest (search for similar items in EconPapers)
Date: 2009-05-20
Note: View the original document on HAL open archive server: https://hal.science/hal-00699208
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Citations: View citations in EconPapers (8)

Published in Journal of Economic Behavior and Organization, 2009, 72 (1), pp.274. ⟨10.1016/j.jebo.2009.05.008⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-00699208

DOI: 10.1016/j.jebo.2009.05.008

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