When will an org adopt an innovation?

Innovation, changes to technologies, processes and products, is inevitable in today’s organisation. But when will an organisation actually adopt an innovation? What are the factors that lead to a decision to invest in a change? The changes involved are usually costly, not only in terms of the initial financial outlay for the innovation itself, but also in terms of time and effort involved in implementing the change, not to mention opportunity costs. So a business needs to know whether it is making the adoption decision for the “right” reasons. Knowing these key factors also helps managers who are hoping to sway decisions – focus in on the three crucial elements and you’re more likely to adopt (or dissuade from adopting) innovations.

We integrated the Theory of Planned Behaviour from psychology with macro innovation adoption literature. We then tested our model with 134 organisations to see if it worked. This is what we found…

Three Key Factors for Innovation Adoption

The first key adoption factor is Orientation Towards Innovation. Organisations that have a positive attitude (that is, they see innovation as beneficial, rather than a necessary evil), who enjoy taking risks, and who have experience with successful innovations are more likely to adopt new technology, processes or products. Basically, when decision makers think that “new” equals good, then innovations are more likely to be adopted quickly.

The second adoption factor is Pressure to Adopt. This pressure can come from customers, suppliers, competitors, professional networks, government departments, universities, and so on. If others think that innovation is good then we feel that our organisation should innovate.

The final factor is Control over Adoption. It’s not enough to want to innovate, an organisation also needs to make sure that it is able to adopt and implement the innovation. This control involves the belief that the organisation has enough financial resources, managerial and employee readiness, and the in-house capabilities required for success.

It is this last factor that we found was most important. Adopting an innovation is a complex business and there are many hurdles to overcome. Knowing that your company has the capability to pull it off is going to keep the adoption going – even when your positive attitudes and peer pressure are suffering from setbacks. When an organisation has accurate perceptions of its ability and control over adopting and implementing the innovation, they will move onwards and upwards.