Masaru Karube

Reasons for Innovation: Legitimizing Resource Mobilization for Innovation in the Case of Okochi Memorial Prize Winners

This paper addresses reasons for innovation. Innovation requires resources to transform new ideas into products/services to be sold in the market and diffused in society. Yet in the earlier stage of innovation process uncertainty always prevails both technologically and economically. There is no objective consensus that the new idea will succeed in the end. It is thus necessary for those people who want to realize the innovation to show others both inside and outside the firm legitimate reasons for mobilizing their precious resources, including people, materials, facilities, and money, throughout the process toward commercialization. How do firms legitimize the resource mobilization for innovation? Drawing on 18 case studies on Okochi Memorial Prize winners, which our joint research project has carried out over last five years, and building upon the existing literature on internal corporate venturing, new ventures, and other related issues, this paper examines the innovation process of established Japanese firms from idea generation to commercialization with a primary focus on the process by which resource mobilization was legitimized.

Organizational Deadweight and the Internal Functioning of Japanese Firms: An Explorative Analysis of Organizational Dysfunction

In this chapter we examine a cause of organizational dysfunction from a new perspective. Some researchers have insisted that excessive bureaucratic management such as emphasis on a priori planning is ineffective. In addition, others have discussed that Japanese firms adopt an alternative system which incorporates plenty of “organic” characteristics and promotes proper emergent strategy and innovation. However, the Japanese management system can also have serious side-effects. Massive efforts for coordination among members are required and valuable resources are uselessly dissipated, when organic characteristics are excessive in an organization. For discussing the issue, we propose the concept of “organizational deadweight,” critical interference with efficient and effective management in an organic system. Inside quantitative and qualitative data of business units was collected in some major Japanese firms. The results of the analysis show that the “organizational deadweight” has significant relationship with important organizational characteristics, and imply that a balance between mechanical characteristics and organic ones is the key to manage a business organization.