organizational inovation deals with too many intangibles and many uncertainties; total replication is just not possible. Replicate and adapt, and you are back to the environment-time-place-people choices again. Technological innovation, on the other hand, has the luxury to deal with mainly the tangibles, although tacit knowledge is a vital input.

and here is where the different theoretical perspectives come into play: Economists deliberately avoid the issues of individual differences because of its macro perspectives; organizational scientists take a more micro approach, dealing more realistically with incentive problems; and psychologists go even further to the micro level. At different level of analysis, these theories would be especially useful for different people dealing with issues at the corresponding levels.

all those works are great stuffs. williamson’s and chandler’s and etc. they are celebrated for their contribution, but i guess it is also our job to fill-in the limitations. maybe a meta-theory-of-contingency on organizational innovation, anyone?

The problem is that firm strategists, consultants, and managers then start claiming knowledge that doesn’t exist. I applaud people that look at the results of the competitive sorting function and then try to explain why what happened, happened.

However, I have seen an institutional bias in favor of assuming knowledge that doesn’t exist, and this has led to some of the worst economic and social disasters in human history.

Applying the rhetoric of science in this situation is especially dangerous since one ends up with something with the authority of science, without a lot of the internal checks and balances. One of the big institutional checks and balance that I’ve seen in physics that doesn’t seem to be as strong in the social sciences, is the ability to get up in front of a group of people, and say “I have no freaking clue what is going on here” and get respect for this.

It’s not what you don’t know that gets you, it’s what you think you know that isn’t.

Is it something the organization just creates, or as Wikipedia it defines:

“Organizational innovation involves the creation or alteration of business structures, practices, and models, and may therefore include process, marketing and business model innovation.”

For every organizational innovation that works, there may be hundreds that don’t. The ones that do, get copied. The ones that don’t, get forgotten. The thing that people I don’t think realize is that there may be no way *a priori* to know what works and what doesn’t. If this is the case, then it becomes impossible for the individual to rationally plan strategy, since the information that he needs to know in order to plan strategy *does not exist*. However, the system is rational, because you have lots of people doing different things for irrational reasons. Some work. Some don’t. What works survives. What doesn’t work, doesn’t. It’s only *after* you do the experiment that you can try to piece together why something worked, and *even then* you might not really know.

The other thing that makes biological analogies more useful than mechanical ones is that organizations exist within a social context, however changes within organizations change their social context which forces other changes within organizations. What works in one socio-cultural context may be completely broken in another.