Management teams' regulatory foci and organizational units' exploratory innovation: The mediating role of coordination mechanisms

Abstract

We further current understanding about the role of management teams in driving exploratory innovation by proposing that the regulatory focus of an organizational unit's management team is a key antecedent of the unit's level of exploratory innovation, and by clarifying the organizational coordination mechanisms through which this antecedent generates the unit's exploratory innovation. Our results, based on a survey of 748 managers from 69 organizational units of a large multinational semiconductor company, indicate that the promotion focus of a unit's management team relates positively to the unit's exploratory innovation. In contrast, prevention focus has a marginal negative effect. These effects are mediated by the management team's use of decentralization and connectedness. Our research advances theory development regarding the micro-foundations of organizational innovation and increases our understanding of how the views of a unit's management team are reflected in the unit's level of exploratory innovation and therefore impact the unit's chances of survival.