The hidden champion concept has received much interest in practice. As market leaders in niche markets, hidden champions represent the success of the (German) Mittelstand. Innovation is a key element of their strategy and their focus and niche market strategy are associated with specific technological capabilities. However, thus far, little quantitative empirical evidence exists about the innovation output of hidden champions. Drawing on a capability perspective and using patent data, the present study analyzes differences between hidden champions and comparable non‐hidden champion firms in their technological innovation. Our results show that hidden champions have a significantly larger technological innovation output but do not have a higher efficiency in their innovation creation compared to other firms from the same industry, size, and age. Moreover, the innovations produced by hidden champions show higher levels of technological depth and indicate lower levels of technological breadth. The sources of technological knowledge of hidden champions seem to be more inward oriented. Finally, innovations of hidden champions have similar technological impact, novelty and quality compared to those of other firms. Overall, our study supports many of the anecdotal beliefs about the innovation of hidden champions contributing to a better understanding of what makes hidden champions different from other Mittelstand firms. Practical implications for hidden champions and Mittelstand firms are discussed.

Scholars have suggested that autonomy can lead to better entrepreneurial team performance. Yet, there are different types of autonomy, and they come at a cost. We shed light on whether two fundamental organizational design choices—granting teams autonomy to (1) choose project ideas to work on and (2) choose team members to work with—affect performance. We run a field experiment involving 939 students in a lean startup entrepreneurship course over 11 weeks. The aim is to disentangle the separate and joint effects of granting autonomy over choosing teams and choosing ideas compared with a baseline treatment with preassigned ideas and team members. We find that teams with autonomy over choosing either ideas or team members outperform teams in the baseline treatment as measured by pitch deck performance. The effect of choosing ideas is significantly stronger than the effect of choosing teams. However, the performance gains vanish for teams that are granted full autonomy over choosing both ideas and teams. This suggests the two forms of autonomy are substitutes. Causal mediation analysis reveals that the main effects of choosing ideas or teams can be partly explained by a better match of ideas with team members’ interests and prior network contacts among team members, respectively. Although homophily and lack of team diversity cannot explain the performance drop among teams with full autonomy, our results suggest that self-selected teams fall prey to overconfidence and complacency too early to fully exploit the potential of their chosen idea. We discuss the implications of these findings for research on organizational design, autonomy, and innovation.

@article{boss2023organizing,
  title     = {Organizing Entrepreneurial Teams: A Field Experiment on Autonomy over Choosing Teams and Ideas},
  author    = {Boss, Viktoria and Dahlander, Linus and Ihl, Christoph and Jayaraman, Rajshri},
  journal   = {Organization Science},
  volume    = {34},
  number    = {6},
  pages     = {2097--2118},
  year      = {2023},
  doi       = {10.1287/orsc.2021.1520}
}

This article investigates how crowdsourcing for knowledge creation in a crucial knowledge‐intense task – patent application examination – informs decision‐making. It is hypothesized that patent examiners’ views underly a local search bias (i.e., they rely on locally preferred and conveniently available local information), which may be overcome through crowdsourcing. To analyze this potential effect of crowdsourcing, this study analyzes USPTO’s Peer To Patent initiative, opening the patent examination process to public participation for the first time. The data from this initiative is further enhanced with data from the PatentsView database and the Patent Examination Research Database. The study results provide the first empirical evidence that crowdsourcing aids a patent examination process in overcoming the examiner’s local search bias – their over‐reliance on internal knowledge. In particular, it is found that crowdsourcing in patent examination increases examiners’ reliance on atypical and less formalized knowledge. Overall, these findings enable several theoretical and practical recommendations.

Open innovation, in the form of inbound and outbound open innovation, is an ever-increasing research field. Research into outbound open innovation (i.e., the inside-out process) focused mostly on the commercialisation of internal knowledge. However, we know very little about firms’ voluntary nonpecuniary knowledge disclosure. This paper sheds light on this understudied research field by conducting a quantitative study that identifies which internal and external conditions foster firms’ knowledge disclosures. The results show that firms’ strategies to influence (i) the market and the competition and (ii) external spillovers are drivers of firms’ knowledge disclosures. Further, the moderating roles of environmental characteristics are shown. Firms’ environmental technological dynamism is found to strengthen the positive relationships between influencing external spillovers and knowledge disclosure. In contrast, the relationships between influencing the market and the competition and knowledge disclosure are negatively moderated by a firm’s environmental technological dynamism.

Monetary rewards have become widely used to compensate user engagement in innovation contests. Building on literature on social judgement of organisations, we provide evidence on another important effect of monetary rewards in innovation contests, namely a signalling effect that may either enhance or lower a contest host’s legitimacy and subsequently users’ willingness to participate in the contest. Along three studies, we show that the signalling effect is especially beneficial for the innovation contest purposes that are incongruent with the host’s organisational stereotype, i.e., in cases where she lacks specific organisational traits that constitute users’ perception of organisational legitimacy. Offering a higher monetary reward in such a scenario allows hosts to overcome a lack of legitimacy and consequently foster user participation.

This article addresses the importance of tailoring publications to expectations of the intended scientific sub-community it addresses. But what does this mean when writing an article and adopting community specific jargon? This article disentangles the effects of articles’ language complexity on their impact. In the domain of entrepreneurship science, we show that language uniqueness (in form of aligning jargon uniquely to one community) has a positive effect on article’s impact. An article’s novelty (in form of novel recombination of community jargon) has an inverted U-shape relationship with impact. We further show that the optimal level of novelty decreases with increasing uniqueness, yielding higher overall impact. These findings have implications not only for authors of scientific articles but also for their audience.

Entrepreneurs face the challenge of having to conform to gain legitimacy, while at the same time differentiating themselves to gain competitive advantage. We show how entrepreneurs can craft an entrepreneurial narrative to succeed in this task among the user audiences empowered to evaluate their products.

@article{vossen2020more,
  title     = {More than Words! How Narrative Anchoring and Enrichment Help to Balance Differentiation and Conformity of Entrepreneurial Products},
  author    = {Vossen, Alexander and Ihl, Christoph},
  journal   = {Journal of Business Venturing},
  volume    = {35},
  number    = {6},
  pages     = {106050},
  year      = {2020},
  doi       = {10.1016/j.jbusvent.2020.106050}
}

Practitioners increasingly use innovation contests to harness the knowledge of external crowds for internal innovation purposes in exchange for prize money. While some innovation contests have the objective to attract professional experts from distant fields to obtain technical solutions, other innovation contests primarily target customers or users in order to generate new product and service ideas. Hence, external crowds differ substantially across, but also within, innovation contests in terms of personal needs in the innovation domain. Drawing upon the private-collective model of innovation, we argue that participants’ “userness” in terms of personal needs gives rise to non-monetary reward expectations and collectively oriented participation as opposed to the private pursuit of monetary rewards emphasised in innovation contests. Hence, the effectiveness of monetary rewards in innovation contests is bound to certain participants and behaviours. In particular, participants weigh non-monetary rewards more strongly against monetary rewards (1) when their personal need in the innovation domain is high, and (2) when choosing to engage collectively in evaluating and commenting on other contributions as opposed to submitting own contributions. We find support for these hypotheses in an empirical study where user participation in a real innovation contest is regressed on survey-based measures of expected rewards that users perceive prior to the contest. The observed effect sizes of the proposed shifts from monetary to non-monetary rewards are so pronounced that for a given level of personal need and a given type of participation behaviour only either reward type is effective and a compensational relation between both types of rewards does not exist. Monetary rewards are even detrimental and lower user participation if the two proposed boundary conditions are taken together.

Recently, scholars are confronted with only small positive, non-existing, or even negative average effects of entrepreneurship education. We draw on two largely neglected and hidden effects of entrepreneurship education, namely the alignment and the sorting effect, in order to explain previous inconsistent evaluation outcomes. Making use of ex ante and ex post student-surveys in a quasi-experimental setting, we provide insights into how these effects emerge and are further amplified by course-induced updates in personal attitudes and perceived behavioral control. Our study shows that relying on average measures is often not effective in evaluating entrepreneurship courses and highlights the need for new outcomes measures.

What motivates university scientists to identify practical applications for their research results and consider having them patent-protected? A wealth of research points towards a complex blend of factors, including organizational antecedents, social norms and personal-level expectations. Few studies, however, have attempted to investigate the effect of concrete incentives from the perspective of individual scientists’ decision-making. In this paper, we operationalize the propensity to patent and commercialize research results as the intention to submit an invention disclosure filing. We use scenario-based conjoint analysis to capture university scientists’ preference structures for different incentive policies. Results indicate that direct and indirect financial incentives are dominant drivers. In addition, a grace period that would allow for patenting and publishing in parallel and the inclusion of patents in academic performance assessments are worth considering, whereas the specific setup of the technology transfer organization and public recognition of achievements in form of an award appear to have limited effect. However, preferences for incentives and hence their effectiveness vary significantly across academic disciplines and ranks as well as with scientists’ working experience, patenting experience and research orientation.

Open innovation is an established approach to improve innovation performance, but many organizations have failed to embed open innovation in their innovation processes permanently and at scale. Building on an investigation of 756 international organizations, we show that the existence of distinct routines and organizational structures can explain why some firms implement open innovation successfully. We present a guideline for managers to master the organizational journey from closed to open innovation, moving their company from an initial state via pilots and exploration toward a permanently open state.

We examine the role of participants’ interactions in innovation contests. In contrast to the dominant view of a competitive organisation of innovation contests, we suggest that, especially for ideation projects, a collaborative setting may be beneficial in terms of the amount of ideation activity and the quality of the generated ideas. Using two experiments, we show the usefulness of a collaborative approach when two particular conditions are met: first, the overall effort must be compensated according to performance criteria in such a way that participants are aware of the impact of their actions. Thus, the reward mechanism has to ensure that all contributors to a specific idea benefit from their involvement. Second, the host has to provide feedback throughout the contest to make it clear for participants what idea(s) to focus on. Our results show that, while the elaboration effort can be increased by introducing a collaborative reward mechanism alone, the best results are achieved when both conditions are met.

For decades the public sector seems incapable to not incur new debt or even save money to overcome the omnipresent stressed financial situation. This grievance is pervasive over several levels of public sector entities including municipalities, the federal states as well as central/national tier. On the local level, bailouts in form of loan repayment are understood as measures to deliver a sustainable solution to and thus overcome the stressed financial situations of municipalities. This study presents empirical evidence for a positive correlation of debt and cost inefficiency of municipalities’ service provision. Furthermore, interest payments have a minor impact on this cohesion. These findings show that repayments of municipalities’ debts are not a sustainable solution to overcome the stressed financial situation on the local government level. Highly indebted municipalities are inefficient in their service provision anyway.

In the public sector, innovation is understood as a major driver of public service performance improvement and excellence. On the one hand, previous research has proven a positive effect of innovation adoption on performance in the public sector. On the other hand, a broad literature proves positive effects of innovation antecedents on innovation adoption. This study bridges this gap and analyses the effect of an innovation antecedent – willingness to adopt a process innovation (accrual accounting) – on municipalities’ service provision cost-efficiency. Therefore, the author makes use of a panel data set of German municipalities, located in the federal state of North Rhine-Westphalia. Evidence shows that a higher municipal willingness to innovate relates to higher cost-efficiency. A higher innovation willingness might have a maximal effect of 17 percentage points on municipality cost-efficiency.

The stressed financial situation in the public sector and the continuous aspiration for austerity in western governments and public bodies is omnipresent. As one core element in the New Public Management shift, Germany, like many other countries, has experienced significant reforms in public sector accounting and reporting in the last decade. We analyse the effect of new accounting and budgeting regimes. We therefore analyse the cost efficiency of German local governments in the state of North Rhine-Westphalia over 3 years using a stochastic frontier approach. This study presents evidence for increased efficiency amongst municipalities due to the adoption of accrual accounting.

The objective of this paper is to discuss the impact of social media on customer co-creation in the innovation process. Customer co-creation denotes an active, creative and social collaboration process between producers and customers (users), facilitated by a company, in the context of new product or service development. The authors propose a typology of co-creation activities in order to develop conceptual arguments how social media can impact relationships among customers involved in co-creation as well as the relationship between customers and the hosting firm. Social media can make economic-exchange relations more collaborative and social, but interestingly may also turn formerly social-exchange relations into money markets with strong competition among actors. As a result, the authors develop a set of questions that can lead to future research in these regards.

A main challenge in new product development (NPD) is to match a new design to customer preferences. Recent reviews show large failure rates in the commercialization of new designs. In most of the cases, the reason of failure has not been a lack of technological capability of the firm, but an incorrect understanding of real customer needs and demands. This article proposes a potential solution for this issue—the concept of embedded open toolkits for user innovation. The concept of embedded open toolkits for user innovation plans for manufacturers to design products with build-in flexibility, so that customers can make changes to the product, even after purchase. This is done by embedding knowledge and rules about possible product differentiations into the product. The main objective of this article is to study the feasibility of the concept of embedded open toolkits. For this purpose an empirical study among 162 potential users of such a toolkit in the automotive domain was conducted.

Markt- und Kundenorientierung gilt als notwendige Bedingung für den Unternehmenserfolg. In der Marketingtheorie und -praxis greift das Konzept aber oft zu kurz, weil in vielen klassischen Ansätzen eine Kopplung an Innovationsaktivitäten ganz fehlt oder ein eher passives Kundenbild dominiert, das Kunden als aktive Innovatoren ausblendet. Dieser Beitrag spannt einen Handlungsrahmen für die systematische Umsetzung von Customer Co-Creation, das heißt der aktiven Kundenintegration im Innovationsprozess.

Theories of innovation suggest the process of product and service development is becoming more open, placing more emphasis on external knowledge and involving a wide range of external actors to achieve and sustain innovation. The growing success of open innovation practices in many firms raises the question of whether these principles can be transferred for the reinventing of public sector organizations. Going beyond a technocratic e-government paradigm, but with the support of Internet technology, the authors present a structural overview of how external collaboration and innovation between citizens and public administrations can offer new ways of citizen integration and participation, enhancing public value creation and even the political decision-making process.