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Innovation Diffusion

Management innovations are management entities—ideas, practices, techniques, or organizational forms—perceived as innovations (i.e., as new and improved) by a collectivity. A collectivity is a group of organizations or employees that tend to use the same entities. Theories of innovation diffusion typically advance social mechanisms, originating from within collectivities, which cause these collectivities to perceive certain management entities as innovations and adopt them, causing their spread or diffusion across collectivity members. By contradistinction, what distinguishes innovation-diffusion from non-innovation-diffusion theories is that the latter attribute the spread of management entities to forces originating from outside collectivities, such as those exerted by government institutions or professional organizations. This entry critically reviews Everett Rogers’s influential “diffusion of innovation paradigm” throughout his five reviews published between 1962 and 2005. It then reviews bandwagon and market theories of diffusion and the diffusion literature that emerged after Rogers’s paradigm. This entry serves three purposes developed in its three parts. The first part presents Rogers’s paradigm and Eric Abrahamson’s challenges. This sets the stage for second part, which reviews management studies that have made substantial headway in overcoming the causes of Rogers’s paradigm’s shortcomings. The third part reviews findings and prescriptions, suggested by recent management research, about how organizations and their managers might adopt more beneficial managerial innovations.

Fundamentals

Rogers’s Diffusion of Innovation Paradigm

According to Rogers, the adoption and diffusion of innovations across a collectivity is caused primarily by the gradual communication of information about innovations through channels linking members of the collectivity. When collectivity members learned through communication channels about management entities that were new and improved, they adopted them, thereby channeling information about these entities to other collectivity members that adopted them, causing still more communication and adoptions, ad seriatim.

Adoption sequence.

Everett Rogers highlighted a multi-mechanism sequence, emanating from within individual or organizational collectivities, causing the adoption of innovations. The first mechanism accounts for the invention of new management entities whose improvements benefit adopters; the second accounts for the communication of information about such entities’ benefits across communication networks; and the third accounts for these entities’ adoption. This third adoption mechanism has a sequence of five stages. In the first, potential adopters absorb information about entities. In the second, they review this information to learn whether the entity constitutes what Rogers called an innovation — that is, an entity adopters perceive as new, improved, and thereby providing benefits. In the third, adopters’ learning persuades them whether to adopt the innovation. In the fourth, adopters persuaded of the innovation’s benefits implement it. In the fifth, if they have implemented the innovation they access whether they should continue doing so or, if they have not, whether they should further delay implementation.

Attributes influencing rate of diffusion.

Rogers’s key policy concern was that innovations should diffuse to members of a collectivity as speedily as possible; this, so that they might benefit from these improvements as long as possible—that is, until older innovations were replaced by the next new and improved management idea, practice, technique, or organizational form. One of Rogers’s foci was the characteristics of innovations that influence the speed of their adoption and diffusion. Two types of characteristics could affect speed. One pertained to how readily the benefits of an innovation could be learned. An innovation’s inherent characteristics might make its benefits easier to perceive (what Rogers called “observability”) or to experience through trials (“triability”), as when its real benefits were relatively greater (“relative advantage”). A second class of characteristics, such as an innovation’s inherent complexity, or compatibility with other innovations, pertained to the greater speed of their implementation (complexity and compatibility). Ceteris paribus, the more the characteristic of a management innovation increased the speed with which individuals or organizations learned about the innovation’s benefits and could implement it, the faster organizations would adopt it and it would diffuse.

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